There are many matters to consider when setting up an offshore outsourcing deal-scope, location, roles and responsibilities, service levels, governance plans and price, just to name a few.

The effect of foreign exchange rates on the transaction tends to fall pretty far down the priority list at the negotiating table, if the outsourcing customer considers the issue at all.

But ignoring the currency exchange considerations associated with offshore outsourcing transactions can be a multimillion-dollar mistake, say analysts. Unanticipated swings in currency valuation can increase a company's exposure to financial risk and drastically minimize savings. Read Full Article