Sometimes, it isn't just about cost. Many companies are fleeing these shores to the warmer and cheaper climes of the Indian sub-continent. At least they are pushing many of their operations in that direction, while still maintaining the air of being "local"; dial a local number to get service from thousands of miles away, and nobody will notice.

Unfortunately, people are already beginning to notice, and not everyone likes it. I'm not keen to talk about social conscience in business, but sometimes the issue becomes unavoidable. Constant news items about job losses are starting to hit the public perception of offshoring, and already one major building society has an advertising campaign that promotes the fact that all its workers are based in the UK.

Whether or not the backlash against offshoring activities will have much effect remains to be seen. The idea that thousands of anti-offshoring protesters will one day march on Whitehall is perhaps unrealistic, but a slowing investment in firms that have offshoring policies is easier to imagine. Ethical investment was dismissed in many quarters as doomed to failure, but it is strong, healthy, and has proven that it can keep pace with standard investment practices.

When one looks at IT in particular, offshoring scores highly in only one of four key areas - that of cost. The other three - skills, logistics, and flexibility - are less well served by this model. When it comes to these three areas, another model is perhaps more appropriate - near-shoring.

Near-shoring is more concerned with the cultural similarities between service request and service provision. This is not an exercise in ethnicity, but a requirement to consider every element of service provision and weigh them carefully. Quality of service and not cost savings should be the aim.

An obsession with cost to the exclusion of all other factors is a sure-fire recipe for disaster; it has happened before and it will happen again unless organisations accept that they need to look beyond next year's financial statements.

There is a proven model for this in North America, where US organisations are looking to their near neighbours in Canada to provide service at a lower cost, but without any of the inherent problems of offshoring. Perhaps the options should be redefined as near-shoring, distant-shoring, and local provision. The measurement of the four distinct elements that should be taken into account can then be compared for each of the three possibilities.

From the UK there could be near-shoring options in Ireland. Looking beyond Dublin - where costs are relatively high - the west of Ireland has all the elements needed for a true cost-effective - rather than a simple cost-saving - model. Even those companies that are obsessed with cost should understand that there can be a 25 to 30 percent pure cost saving with this near-shore model.