CIO Magazine On Offshore IT 732
lpq wrote to us with a reference to the cover article from this month's CIO Magazine that talks about the off-shore movement of IT from its traditional bulwarks to the developing world. A selection from the article:"
Think again. There are real costs associated with shipping your IT department (or a portion of it) overseas. Our Special Report covers the Backlash from a growing political storm as well as the Hidden Costs you should be aware of before you join the stampede overseas. "
More proof that common sense isn't common (Score:5, Interesting)
Sad that people who spend years on an MBA degree that presumably includes a course on Spotting The Obvious 101 can't, well, spot the obvious.
Re:More proof that common sense isn't common (Score:4, Funny)
Actually... I would love to see them add just one more course to the MBA programs...
Just Because Im Educated, Doesnt Make Me Smart: A Case Study of MBA Graduates
Re:More proof that common sense isn't common (Score:5, Funny)
"We're short on staff, you'll have to handle the shipping."
"But
"Don't worry, it's easy."
"No, you don't understand, I have an MBA."
"Ohhhh, you have an MBA. In that case, I'll have to show you how to do it."
Re:More proof that common sense isn't common (Score:3, Funny)
If we're talking about MBA grads, can we just say "Just because we have a degree doesn't mean we're educated" and be done with it?
-Tom
It was never about money savings... (Score:5, Insightful)
All of this outsourcing is a thinly veiled attempted to commodidize not just IT, but IT services. Look at every stinking product coming down the pipeline. It's all designed for a chimpanzee to use. Sure it can't do half of what the previous version did, but it uses MicroSoft's backend, costs 3 times as much, and we can hire a teenager to feed it.
So what if all these rosy assumptions explode and take our customer service with it. We sure showed those IT people who was boss. Who needs them...
It was *always* about money savings... (Score:5, Insightful)
If you lost a job to an Indian IT worker, I suggest you *compete* instead of *whine*. (Glad I had karma to burn on this. I can't believe it got modded insightful.)
Re:It was *always* about money savings... (Score:5, Insightful)
Re:It was *always* about money savings... (Score:5, Insightful)
Isn't this exactly what Slashdot likes to tell the RIAA? That new technology enables new business models and kills old ones. That Internet distribution will kill the CD, and they better get on with it or face extinction.
Well, new technology enabled a less expensive worker to do your job. Are you more entitled to an income on your old "business model" than the RIAA?
Yes, the human cost is terrible. I have lost work, and I empathize. However, what do you propose US businesses do?
Re:It was *always* about money savings... (Score:4, Insightful)
What do I suggest? Wake up, smell the coffee, and stop chasing each other to the bottom. Computer companies are like the airlines, they are trying to starve each other out. Look at the air industry, and tell me with a straight face that sort of behavior is healthy.
It must really be nice under Chapter 11 bankrupcy protection. They constantly operate there. I just wish the Gubment would stop bailing them out, let them die, and let a new set of players take their place.
Re:It was *always* about money savings... (Score:4, Informative)
First of all, there are serious differences that must not be overlooked. In general, a business might be capital intensive with relatively cheap labor (think automobile assembly plant or oil refinery), or light on capital with relatively expensive labor (think computer programmer). Airlines are both: capital intensive (airplanes and other specialized equipment) and powerful, expensive labor (pilots, etc).
As such, labor cost is pretty much the only thing a software vendor can cut. An airline can go to the Southwest model and use only one type of aircraft to save on maintenance, or try to force unions to lower wages, or try to reduce flights in unprofitable routes. A software vendor is unlikely to save any significant amount of money by making its programmers use a cheaper computer, or take up less office space. This nature of the software business is also why people can write a competitive operating system in their spare time.
Therefore, they try to find cheaper labor. Slashdot anecdotes notwithstanding, it really isn't clear at all to management that the resulting quality is markedly worse. In fact, the same Slashdot anecdotes would suggest that management hardly cares about quality at all. Like I said, I empathize, but I think "stop chasing each other to the bottom" is not an alternative that US businesses can understand and accept. Moreover, even if they didn't outsource to India (assuming the quality really is worse), they still may outsource to somewhere in Europe for similar quality and slightly lower wages. What would we complain about if they did that?
My point is, either you have a problem with poor quality, or a problem with outsourcing. Using the former as a reason to avoid the latter is really a bit hokey. A problem with outsourcing per se, however, is a political question, not a business or microeconomic one.
(Incidentally, this also likely means that setting up an automobile plant in the US is not that much more expensive than one in Japan or Europe. It's easier for the savings in shipping and taxes to make up for the higher wages, so it's not really fair to compare the two.)
Re:It was *always* about money savings... (Score:5, Insightful)
Compete? Excuse me? I was laid off as an Intern at $12/hour so the company could move to Singapore. I lucked out, I could move back in with my parents. The other engineers have families and mortgages.
Your pop and swap mentality flies completely in the face of reality. People, get this, actually require steady paychecks. You start talking about universal health care, free meals, and housing guarentees, then we can talk about us all being interchangable.
But we aren't talking about that. We are talking about workers having to be self-sufficient with no guarentee of work. And it's not even unskilled workers anymore. You have hard-working college educated people who are now competing for the unskilled shit jobs of the world, bumping the unskilled people even further down the hole.
Ask the French sometime about what happens when the Middle Class goes into a toilet-bowl spiral while the Upper Crust get fabulously wealthy. Better yet, ask the Russians.
Re:It was *always* about money savings... (Score:3, Interesting)
NAFTA, on the other hand, what Ross Perot called the "giant sucking sound", was primarily responsible for huge employment losses in the blue collar labor market. If I remember correctly, the government and big business were all for NAFTA, but the working people were all against it. Sound fam
Re:It was *always* about money savings... (Score:3, Funny)
I for one am planning on starting a new industry: replacing CxO's with software. The smarts don't have to be that sophisticated. At present CEO/CIO/CFO's are random number generators with single register math. Imagine what could be done with a modern processor that can track more than one factor, and some memory to gauge progress and effectiveness.
Re:It was *always* about money savings... (Score:4, Interesting)
Humm so looks like slashdotters don't have any problems lumping all the businessmen into one group but gets offended if they are lumped into one group...
Re:It was *always* about money savings... (Score:4, Insightful)
So me, with college bills, with a higher standard and thus a more expensive standard of living, am supposed to compete against a country with no minimum wage, no real labor laws of any kind? How? Those indian IT workers are making less than your average burger king employee ($10,000 a year is considered good there - here, you would have to go on welfare to survive at that level.)
Re:It was *always* about money savings... (Score:5, Informative)
Re:It was never about money savings... (Score:5, Insightful)
It seems conspiratorial, but I can't help believe it. I had a debate with my wife (who is a high-level marketing exec) about the wages of engineers vs. marketing staff, who ultimately end up dominating corporate management. The crux of her argument came down to: engineering salaries should never be more than marketing salaries, as marketing is "more important" than engineering -- never mind that without engineering you wouldn't have products to market, or with shoddy engineering you're working harder to sell shoddy products.
I think this cultural aspect is quite telling, and I think there are a lot of "suits" who think the same way. Whether or not IT salaries during the dot-bomb era were too high for economic reasons is immaterial, they had become too high for socio-cultural reasons ("Why is the IT guy driving a better BMW than ME?!?!"), and rather than see their businesses dominated by IT people, they sought to "control" this phenomenon by various means -- outsourcing, H1-Bs, lower quality packaged software, and so on.
The cultural explanation may not be the only reason, but I think its a significant one.
Re:It was never about money savings... (Score:3, Insightful)
Re:It was never about money savings... (Score:3, Informative)
My two partners and I run a small business. All of our specialties are in IT. We are in need of a good salesperson as we have lost several potential clients because none of us have good sales skills or experience. Good product and service to matter but only after you sell the product and gain clients!
I'll have to say that some of the most closed m
Re:It was never about money savings... (Score:4, Interesting)
(mod parent up).
When I was employed at "VeryLargeSoftware Corp", (who incidentally, has an office in Pune), I saw engineers who were denied new hardware, essential for fulfilling the needs of engineering a product to run on the same equipment our customers were running on. For budgetary reasons.
Our company engineered many products, because we were a result of many mergers and buyouts over the years, with satellite offices all over the country. But the sales team really focussed on our top-selling product. They could not be made or enticed to actively sell the other products. As a result, the other products, regardless of technical merit, whithered and died, and the satellite offices were closed down one by one, putting engineers out of work. The sales guys didn't care, because their offices were at our HQ.
So While the sales guys were, essentially not doing their job - they refused to do their job, and our officers refused to force them, and while our engineers were being constrained by opressive and crippling budgetary restrictions, the sales and marketing groups were rewarded with offsite meetings at posh resorts, junkets (one of which was a company-paid trip to South Africa, including a safari trip, resort stay, and an engraved commemorative gold watch - as a reward for what ultimately turned out to be a year of lackluster sales).
Freinds who had been laid off and got jobs at other software companies, had reported similar situations.
Re:More proof that common sense isn't common (Score:5, Insightful)
What's the idea behind a MBA is greed, greed, greed and more GREED. MBAs are about extremely short-sighted profit-maximizing though any means possible, including disreputable, unethical, slimy and illegal ones.
Common Sense is Tricky:Outsourcing but NO to H-1Bs (Score:5, Interesting)
How? First, please visit the web site that explains "H-1B Myths [ucdavis.edu]". Professor Matloff, who teaches computer science at a top-notch university, has campaigned tirelessly to terminate the H-1B program.
Anyhow, we have only 2 choices.
The second choice is best and will result in the long-term gain of jobs for Americans. The United States of America (USA) is a big market, and companies will set up shop in the USA once their share of the market reaches a certain critical size. As well, domestic content laws facilitate this trend. Toyota and Honda are excellent examples; they have built huge manufacturing and design facilities in the USA.
Further, by terminating H-1B employment, you ensure that American jobs stay with Americans.
The second choice also directly deals with the strongest bogus argument by unethical American companies like Intel and possibly Google [slashdot.org]. Even when Silicon Valley has 8% unemployment, they insist that cannot find American workers for critical jobs and that they must hire H-1Bs. We in the Slashdot community should say, "Fine. Go set up shop overseas. There is plenty of labor there."
You have more than 2 choices (Score:3, Insightful)
No, you have many, you are only presenting two.
Minor training of unemployed US programmers to fill the missing roles would have been the best option.
You're ignoring all the out of work US programmers.
Re:Common Sense is Tricky:Outsourcing but NO to H- (Score:4, Informative)
I think your view of the evolution of the US is unfortunate and at its roots simply pessimistic for pessimism's sake -- or perhaps a little prejudiced? I mean no insult, just my genuine feeling from your post.
You back little of what you say with data, and have peppered your argument with the kinds of 'proletariat overthrowing the bourgeious' Marxist rhetoric that died with, well, a vast majority of the Marxist states. Dialectical Materialism is all but dead, unless you like what's happening in Vietnam and Cuba.
For the middle class, undoubtedly the most powerful entity in the US ecoonomy, to die, and the lower-income segment of the population dominate the population numbers, a huge disparity in wealth would have to occur. Mind you I write 'wealth', not 'income'. Look at the average middle-class American, his/her life is not necessarily so different than that of the elite. TVs, nice cars, vacations, McMansions, all of these things abound. The *relative* cost of material wealth in the US, and for the most part the rest of the capitalist world, is constantly decreasing when compared to income.
It's also pretty easy [redherring.com] to find data [mfc.org] that debunks your claim that there is a blooming lower-income representation in the US. There is a *huge* amount of mobility in America in terms of income. As long as the lowliest, poor, academically challenged kid can train to become a plumber and make six figures, people in the US will continue to (with notable exceptions) rightly blame themselves when they're unhappy with their incomes/overall wealth. Mobility is alive and well, and small-medium sized mom 'n pop businesses continue to be a backbone for the economy.
Your post was lined with an implicit criticism of materialism in the US. I couldn't agree with you more, there. What famous Marxist said something to the effect that the West would sell the noose to its executioner? Unfortunately, it seems like the charge from materialism leads quickly to religious fundamentalism, a disease that is quickly spreading through all parts of the globe.
Offshore IT work is fine by me (Score:5, Funny)
You know, because my house is going to get blown away and swept into the chesapeake bay, you insensitive clod.
Get used to it (Score:4, Insightful)
Re:Get used to it (Score:5, Insightful)
Does it lower cost in the short-term? Yes.
Does it improve the quality of support? Arguably no.
Does it improve the quality and tightness of the product? Arguably no.
Does it strengthen the company from within? No.
Does it lower cost in a reasonably reached fashion that increases internal productivity and doesn't make the other 10,000 workers in your company pray every night that their job (that required $20,000 of schooling according to your posted job requirements two years ago) isn't going to be shipped overseas to someone else? Likely not.
I don't know if you call this "working", but I don't.
Let's see some stats there (Score:5, Insightful)
These last two are almost certainly true, but it's how they compare to the first that matters. The engineers always want to make the best product, and understandably so if they take pride in their work. But management has to consider the possibility of making the second-best product if it's a damn sight cheaper. It can certainly be a good move.
Does it strengthen the company from within? No.
That's pretty nebulous, and doesn't really translate effectively to the company's bottom line. Strengthening the company by reducing costs might be worth more. And it's questionable how a company would strengthen itself by keeping overpaid, underskilled, non-management-material American coders on the payroll.
Does it lower cost in a reasonably reached fashion that increases internal productivity and doesn't make the other 10,000 workers in your company pray every night that their job isn't going to be shipped overseas to someone else? Likely not.
Like hell. First, the most motivated worker is the one whose job is on the line, like it or not. It may not be pretty, it's the truth. Hell, remember the dot com boom? Where was the employee loyalty to the company then when employees were shopping themselves to the highest bidder? That shows how taking a hit for a "stronger company" gets the company nothing. Why should they take that cost hit for nothing when their employees leave anyway when the economy gets good?
Face it, today neither labor nor the company has any loyalty to the other side, as neither has earned it. Bottom line is if your job can be performed by an Indian almost as well as you do it for 20% of the cost, that's what they'll do.
If anyone has any actual numbers to counter this, I'd like to hear it. All I know is that the American auto industry strengthened itself immeasurably after moving manufacturing jobs overseas. For one, it actually became profitable again and stopped hemorraging market share to foreign manufacturers.
And that's the kind of jobs we're talking about here. We're not talking about people on mission-critical projects fearing for their jobs. We're talking about code monkeys, the equivalent of the assembly-line bolt-turner of the auto industry. That under-educated person has never had security in any other industry, and I fail to see why the code monkey should expect anything different.
What it means is that the economy will no longer guarantee $60,000 a year and job security to someone who can only write mediocre code with no other skills. Most other people are probably safe.
Re:Let's see some stats there (Score:3, Interesting)
I know, lets see it strengthen itself by only keeping managers on the payroll. We can call the company the Titanic. Oh, and just to make sure, hiring lawyers is off-limits.
First, the most motivated worker is the one whose job is on the line, like it or not.
Yeah, motivated to spend company time and resources farming out his resume. I guess morale can't be measured in dollars so it must not cou
Re:Get used to it (Score:3, Informative)
Umm... read the article, one of it's main points is that it does NOT lower cost in the short-term. going off-shore can actually increase costs for the short term. It is *long-term* savings that are the real potential benefit. After the transition has been paid for, the kinks worked out and the off-shore staff trained and familiar with the processes and applications and the disruption (including the dissatisfaction of the remaining staff) worked through *then* it
Good point (Score:4, Insightful)
That's actually a really, really good point. While I personally am not a good candidate for outsourcing (writing process control software that for now requires me to be on-site), my morale and loyalty to the company would be greatly depleted if my company were to send hundreds of IT jobs offshore.
Why? Well, regardless of my necessity at current, I'm always going to be working with one foot out the door if I know that I'm really only around until they can figure out how to pay someone else less for what I'm doing now.
Screw that! (Score:3, Interesting)
I'm not getting used to anything.
If the corporate system does not work for me, then screw it. It's a system and we have choices. Companies are all in favor of free markets except when it comes time to compete, why should I be any different!
My question is, why can't the people of India build themselves up the way the Europeans and the Americans did. They can't because of an economic system that screws everyone. Third world nations can't get their markets started by themselves because the first world na
Re:Get used to it (Score:3, Interesting)
Actually, you are wrong. You see, finance is engineering. The units are dollars instead of joules, but the principles are entirely the same. I mean this quite literally - the equations of certain derivatives are the equations of heat transfer. CFD algorithms are used to price bonds. Managers are
Farming out != Good (Score:5, Informative)
Agreement (Score:3, Informative)
It wasn't just bad, it was even unreadable in places.
Just my 2cents worth, go ahead and mod me down for being redundant........
Missing the point... (Score:5, Insightful)
Shit programmers exist everywhere. There are shit hot people in India, there are crap people in the US. The trick is to meld the good people in both areas to create decent teams as the client needs to speak NOW to someone, and that person HAS to be in the US. But the basic work can be done by top quality people in India.
It does work, and I for one have had good experiences of it, and I'll tell you one thing. Its a damned sight easier to get rid of the shit person on your project in India than it is in the US.
Re:Farming out != Good (Score:3, Interesting)
The Stampede Overseas (Score:5, Funny)
It's about time. (Score:5, Insightful)
Man, no wonder the economy fell flat on its face. The CEOs didn't notice their shoelaces were tied together.
Remember Sammy Jankis. (Score:5, Insightful)
So they're finally realizing that you can't skip the analysis of an action, just because it's the hot new thing all the management consultants are raving about?
Nope. They're realizing that the current Offshore IT fad is over-rated. Come the next fad they'll be praising it to high heaven as if there had never been any other fads. The IT industry has no long term memory at all.Re:Remember Sammy Jankis. (Score:4, Insightful)
Contact (Score:5, Interesting)
There is nothing to compensate for talking round the water cooler and say "Whilst I think of it...". I hoenstly believe that the development costs might be lower but overall it will cost more on the bottom line
Rus
Bitter? (Score:5, Funny)
Re:Bitter? (Score:4, Funny)
Executives aren't.
At least if jobs are sent overseas, the people being paid to work, not sit on their asses.
. . . Though, if we sent executives' jobs overseas, perhaps the overseas workers would send them back. I mean, that's what OUR executives are doing now, right?
Screw free trade (Score:5, Insightful)
MOD PARENT UP (Score:4, Insightful)
This is a ridiculous double standard, that needs to be remedied immediately. Either drop all import tariffs or enforce tariffs on exported jobs. The government is by the people, of the people, and for the people, so let's start acting like it.
Re:MOD PARENT UP (Score:4, Insightful)
Then, drop the tarriffs, albeit slowly, so the markets have time to react. Eventually--given appropriate time--the lack of tarriffs will only bolster international trade making the USA better off for it.
Re:Screw free trade (Score:5, Interesting)
Re:Screw free trade (Score:3, Funny)
Regulation is needed. Pure forms of either capitalism or socialism are foolishly idealistic and sure to fail.
Why Free trade is good. (Score:5, Insightful)
But then the US supply is limited (which is why there is a huge trade deficit), so the US suppliers jack up their price.
The consumer has to either pay the inflated US price, or buy the imported goods with the tarrif.
The end consumer ends up paying more for the same goods, and the market loses competition.
This is a basic econ topic, along with why minimum wage kills jobs and such.
Re:Screw free trade (Score:3, Insightful)
Is this a joke? Do you really want the USA to stagnate in its little corner of the world while everyone else just rolls their eyes and laughs at us while progressing far beyond us in every respect?
Free trade is the long-term normalizer of the world. It levels the playing field so THE TRUTH and the FREE MARKET runs business, not some politically contrived fantasy of keepin
How can this be "insightful" ? (Score:4, Insightful)
And since you are speaking of protectionism, how about tarif on US farmer product, US biogenetic seeds, Tarifs on everything the US product and export everywhere. You might have a trade imbalance deficit, but once other country follow you, you WILL feel the pain. Do not ask for more that you wish.
favorite quote (Score:5, Insightful)
The strategy was not embraced by employees about to get laid off? Ummmm.... how stupid are you if you think people will embrace being laid off to save the company a couple of bucks? (which then goes into an executive bonus, no doubt)
ComputerWorld article on same subject... (Score:5, Informative)
IT's Global Itinerary: Offshore Outsourcing Is Inevitable. An interesting read, and they do make it seem pretty inevitable.
At least you have a job (Score:3, Funny)
What should I do?
The fault in our economic system (Score:5, Insightful)
For me, jobs going offshore exposes the fault in our economic system, and shows how in many ways it is very primitive.
At the turn of the last century people imagined a time when everyone would live in luxury and not have to work. Machines would be able to do the work, and the majority of people could just relax and have a good time. The idea is even more possible today - we can create machines to do most jobs these days, and we should all be living in a work-free time of abundancy. So why aren't we? The simple answer is that our economic system won't allow it - in our system, in order to be able to have stuff, you need money, and to get money you have to work. They crazyness of this situation is highlighted by the fact that periods of adundance now actually cause recession - things become "too cheap", defalation occurs, people can't make money, everybody looses when things are plentiful.
How does this relate to offshore IT? For me it is exactly the same situation. If someone is willing to do my job in another country, then great, I should be able to put my feet up and relax. But of course it doesn't work like that - I loose my job and have no money.
People say that our current economic system is the best system because "it works" but I don't buy that. In many ways it is fairly crude. I think if an alien came from an advanced planet and looked at us today it would think, "look at those idiots working most of their lives when they've already most of the tools to live a life of luxury!"
Re:The fault in our economic system (Score:5, Insightful)
Where we are going (Score:3, Insightful)
While a few were rich, most people seldom even had enough to eat. The 20th century was incredible. We acquired the ability to produce food and goods to satisfy the needs of everyone on earth, though we did not make them available to everyone.
We have had two major power struggles during the 20th century. At the beginning, production was 'difficult', so those who could produce
Re:The fault in our economic system - not only (Score:3, Insightful)
There is more than cost savings when moving work offshore. Companies also gain a lot of relief from litigation. They don't have to worry about lawsuits for discrimination, sexual harassment, or wrongful termination.
It's similar to when manufacturing plants went offshore. Corporations loved the relief from unions, OHSA, environmental and child labor laws.
It's a race to the bottom....
Re:The fault in our economic system (Score:4, Interesting)
Fortunately I live in a free country so I don't have to whisper my non-mainstream thoughts. I feel sorry for you poor Americans.
Ok I'm being deliberately provocative, but you raise an interesting point. I have a friend that grew up in the USA until his early twenties, then came to Europe, then decided to spend some more time in the USA in his early thirties. He returned to his old community where he still had many friends he grew up with. He said he was amazed by the fact that he was completely rejected by many former friends just because he had some non-mainstream views. Nothing very controversial either, at least not here in Europe - Bush is corrupt, Americas foreign policy these days is much worse than it used to be, stuff like that. He said that people he grew up with would completely stonewall him and reject him just because of his opinions. Now, I don't know what you might think of this, perhaps in America this type of behaviour might be "normal" or accepted. But pretty much anywhere I've been in Europe people don't reject you just because of your opinions. The fact that you have said I shouldn't "be talking about it too loudly" because I have mentioned something that might be considered socialist makes me understand what a hard time my friend must have had returning to the USA. He only lasted four months before returning to Europe.
Bad Comparison (Score:5, Insightful)
From the article:
"A good American programmer will push back and say, What you're asking for doesn't make sense, you idiot," Zupnick says. "Indian programmers have been known to say, This doesn't make sense, but this is the way the client wants it."
What a bad comparison: compare a "good" local worker to a generic "bad" offshore worker, rather than comparing good-good or bad-bad. I look around and see plenty of local programmers who adopt the "build-to-specs-regardless" stance without hesitation. Similarly, many of the projects here that involve overseas development involve far more communications meetings to work out the details prior to building applications.
There is no shortage of poor programmers here. Blanket statements like the above only steer people toward looking for poor qualities in foreign developers, while ignoring those around them.
Re:Bad Comparison (Score:5, Funny)
Overheard in offices all over America:
Programmer: This doesn't make sense, you idiot!
Pointy Haired Boss: Doesn't it? You're a professional and I trust your judgement. Do whatever you think is best. Thanks for pointing out my lack of understanding.
Re:Bad Comparison (Score:4, Insightful)
When you farm out your work (doesn't matter where), the people you are farming it to lose any and all context. While build-to-spec without question can be a problem with local workers, it's a HUGE problem with farmed out work because often the only context those workers have is the specs.
As an example, the company I work for produces billing software. We farmed (and are still farming) work out to India, and the stuff we got back was, for the most part, crap. Not because of bad programmers, but because it was blindly build to spec. The developers were working in a black hole -- specs go in, code comes out -- and any decent developer will tell you that's a sure-fire way to guarentee crap code.
CIO Magazine on offshore IT (Score:5, Funny)
1. litigation
2. consumption
3. entertainment
4. warefare
This change will not change until we start outsourcing the two political parties.
The company I work for just announced.. (Score:5, Interesting)
With the success of this initial stage and with our need for resources continuing to grow, we will be resourcing to grow this team substantially in the coming weeks.
While we are directly recruiting in India now, we would also welcome your recommendations of suitable external applicants that you may be aware of as potential permanent employees in Bangalore.
Applicants should have 3-5 years experience in billing system deployment with perl, SQL, Oracle and Unix skills. Willingness to travel internationally and to be based and paid in India is a requirement.
Here's what bugs me about my company specifically, and the trend of moving work to India generally:
1. My company is trying to do this covertly, like we wouldn't notice more and more layoffs in our offices in North America and Europe while at the same time increased staffing in India and a requirement that those Indian workers must be willing to travel internationally.
If you are going to farm your workers out to India , at least be honest about it and admit what you are doing, all in the name of a temporary increase to share price....which leads me to point two:
2. If your company will go bankrupt unless you move your workforce to India, then fine. But if you are going there to save a few bucks and make the share price jump 1/4 point, then fuck you. I get billed out at around $300 US per hour, of which I see less than $30 US. Isn't that enough of a profit margin? Maybe we should bring back slavery so that they can make that margin jump to a full 100% of the $300!
I don't hold anything against India workers, but I truly hate any corporation that farms work to India (and other cheap countries) all for the sake of a quick buck.
Love the numbers (Score:3, Interesting)
No back up. No studies. Nothing. These numbers appear to have just been dreamt up. If they weren't - if there's some serious data behind it, then why not just present the data?
Cheers,
Ian
True (Score:3, Interesting)
Our staffing company, in all its brilliance, hired an Indian systems manager to run one of our overseas offices. they saved about $1000 per month in salary. Well, due to his one week of wrecking half the systems, that $1000 they save per month will necessitate his working at least 6 months just to pay for the phone bill.
You see, he crashed the e-mail server, basically irreparably. Needs to be redone from scratch, and he, of course, has not the first clue of how to do this. So who does he call past mignight to unfuck his system? Me! The only American sysadmin at the company.
While e-mail is down, the workers turn to fax/phone for communication, so our long distance and cell phone bills are now skyrocketing, just because of this twat. I wrote a nasty-gram to HQ about how whatever money they thought they were saving has just evaporated.
Going overseas is not always the answer. There is some superb, home-grown talent that even makes economic sense to employ, when all factors are taken into account.
Knunov
Fixes on the fly have been a problem (Score:4, Insightful)
Unfortunatly, these delays and lack of knowledge by the corp has made us look incompetent and word is getting out to other potential customers.
It will cost even more ... (Score:4, Insightful)
In addition, the in-house employee will be quite pissed for being forced to train his replacement, and will not do so as a result.
Get an IT job in a non-IT industry (Score:5, Insightful)
Marketing Hyperbole (Score:4, Insightful)
Reminds me of ads in trade journals for various database products, showing a picture of a non-geek executive getting amazing results from the product, with a slogan that amounts to "Simple Yet Powerful!"
If it's that simple, it's not powerful.
If it's powerful, it's not simple. (Furthermore, it's not really powerful if you can't hurt yourself with it. A power saw that won't saw your arm off isn't much of a power saw; same as power-tool software.)
If offshoring is so simple
Re:Marketing Hyperbole (Score:3, Funny)
How true! I bought a power saw once, tried to saw my arm off, and not a scratch. So I took it right back and told the people at the store to give me one that could saw my arm off.
1) Pay Indians to learn your business. 2) Profit?? (Score:5, Insightful)
One hidden cost is you are paying Indian programmers to learn your business. After they learn well enough, Indians will certainly begin to compete against you.
They will cut out the middleman and the middleman is you. Indian global banking services, anyone?
For Outsourcing to Work... (Score:5, Insightful)
Certain things can be outsourced, but the key it seems is for the item to be extremely well spec'd and self contained. If project A depends on project B being completed, and project A is done in house... project B should not be outsourced. The ideal things that can be moved over seas, are projects that can be completely managed at the other end, and have few dependancies on this end. In other words... all the design specing, etc... has been established already... the people doing the work will have *NO* questions as to what needs to be done, and what their deadlines/goals/etc... are.
Where an outsourced project seems to breakdown are:
Improperly defined specication for work needed or misunderstanding of said work
Dependancies on projects/information else
Poor communication structure between parent company, and outsourced branch
Lack of understanding of parent companies needs or function
No understanda engrish ( this one is bigger then you think )
Where I am at now, we are a manufacturing environment that is expanding. Now, we dont exactly outsource, we build new plants in other countries. As it stands now... *EVERY* time we set up a new plant... it was always a communication breakdown that was the primary problem. Also, setting up the infrastructure between China, US, Canada, etc... isnt even slightly cheap. Every new faucility costs a wack of cash. That said... not one of the expansion plants we have built overseas ( including Europe ), has approached the success level of the ones we have in North America. Additionally, local laws have all but resulted in closure of one remote faucility... and work ethic of one certain European country, is soon to result in another.
There are alot of hidden costs in dealing with countries outside of North America. Until you go down that road, you are going to be shocked to find out, just how many. ( For example... probrably 1000 man hours, atleast... and 100 cross continental flights... just for initial training/setup ).
Re:For Outsourcing to Work... (Score:3, Insightful)
Software specs universally suck. Software specs are primitive compared to mechanical drawings, architectural blueprints or electronic schematics. Those things are much easier to outsource. Mostly, you get back what you asked for and it works. From my experience, outsourced software projects fail. And most porjects were not even offshore.
The majority of offshore software development projects will fail, but not before corporations show huge short term savings on their quarterly re
Hidden problems with offshoring (Score:5, Insightful)
I send out a spec to my carefully chosen offshore vendor and they dutifully develop the application at a lower TCO than I think I can do it for.
While they're developing it, they have a secret 'shadow' team - maybe in a completely separate company - that takes my spec and produces an enhanced version 2.0 of my application. Now they can bypass me and market directly to my customers, competing with my (now out of date) v1.0.
Oh, they can't steal my Intellectual Property like that? Think again. And you think you're actually SAVING money???
Outsourcing is good, stupid. (Score:3, Funny)
Lovely ethics these folks have (Score:4, Insightful)
But later on he says:
So here he is, richer and better educated than most of the humans who ever lived and he can't even handle basic moral action! He doesn't think something is right, but either can't be bothered or doesn't have the power to say or do anything about it. This makes him either a coward or a slave, neither of which is particularly admirable.
this is a good quote! (Score:3, Insightful)
But what you do not reliaze is that your legislators have ben bought and paid for by most of these groups that are doing this! it is a sad reality.
going off on a tangent (core issue)
This is why we need to build into these public offices accountablilty (remember who you are working for?), fiscal accountablilty, and a REAL campain finance reform. NO SPECIAL INTREST, or PAC groups! NONE, GONE, BYE, BYE.... those are the real threat to american freedoms, and jobs.......
madd is a tool of the devil
riaa is a tool of the devil
statistics are a tool of the devil
john ashcroft is a tool of the devil
Re:this is a good quote! (Score:3, Funny)
I thought John Ashcroft was the devil!
Banding together - joining TORAW? (Score:3, Interesting)
It's not hard to find reasons for CIOs to worry. "Do you want to do business with companies that take away jobs for U.S. citizens by outsourcing work to foreign countries?" asks The Organization for the Rights of American Workers (Toraw), a group of displaced, angry American workers laid off by Connecticut insurance and financial services companies.
I'm browsing TORAW's web site [toraw.org] now, and they look like an interesting organization. Not focused just on moving jobs offshore, they're also advocating a hard look at "non-immigrant foreign workers" - specifically, H1-B visa holders.
I like that TORAW explicity states that they're not against "permanent green card status immigrants", or against anyone based on ethnicity or country of origin. From what I've read so far, they address my concerns without hitting my Green Party [gpus.org] hot buttons. The US should be open to those who want to come, stay, and build a new life -- but we can't afford to export our jobs and livelihoods.
Unfortunately, I can't tell if TORAW membership is available to all concerned Americans. Their membership form is encoded in virus-friendly Microsoft Word format, as are their brochures, and the CIO article notes the local CT connection.
But an organization like this looks like just what we need to keep the IT industry from being the next textile industry [timesdaily.com].
You get what you pay for. (Score:5, Insightful)
There were tens of thousands of lines of code like this. So what are we suppose to do? Spend a senior programmer's hours to do code reviews of the H1B code? Where's the cost savings then?
The project was $270k over budget and a year late. That's the cost of three senior programmers at $90k per year for a full year. And we havn't even touched on the cost of maintaining this mess. Do you really think that the situation will get better if the programmer is 10,000 miles away?
Why can't management understand THAT side of the equation?
3 things (Score:4, Interesting)
Second, if companies can send jobs overseas, and move their capital around whither they will, so too should workers be able to chase the jobs. I'm sure many folks here would be more than happy to code while sitting on a beach in Goa.
Third, with video conferencing a CIO/CFO/CEO could really be anywhere in the world. So why not hire an Indian CEO with a degree from Stanford for $50K? Think of the millions the company would save! Hey, what's good for the goose is good for the gander.
Why I said nothing (Score:4, Insightful)
But I feel real, real bad about it now. I'm sorry.
Cheaper Salary? (Score:4, Insightful)
I seem to recall how some celebrity (Martha Stewart, somebody else?) was in a scandal because her clothing line was alleged to be made overseas by child labor. Illegal here, perfectly legal there.
I'm sure there are many inconvenient labor laws here which can be avoided simply by sending the work overseas.
Point is, some people insist on the notion of free global trade, and open competition between all the participants in the world economy. However, until everyone has to play by the same set of laws, labor and otherwise, some countries will have an unfair advantage in this competition.
And until then, countries which have this unfair advantage, should be penalized with tariffs and anything else to balance out any advantages, real or perceived, that outsourcing would provide.
Re:Cheaper Salary? (Score:3, Informative)
Martha Stewart was only selling stock that was set to go bad... not nearly as horrible as enslaving children...
(and yet Ken Lay runs free...)
Why IT? Why not off-shore lawyers? (Score:3, Interesting)
But IT is hardly the only information-only occupation. How about writing, law, engineering, architecture?
My point is that off-shoring IT in the end will show to be not anymore beneficial as any one of these other professions.
(Imagine a law firm that uses cheap lawyers from Bangalore)
The old saying still stands true (Score:4, Insightful)
Although in truth it doesn't always apply to highly paid workers (some are still lazy buggers), but quite often is the truth when dealing with attempts to save money by outsourcing.
Seriously, I doubt that anyone thinks that you can get 100% quality for 60% cost, but I'm sure many companies find the quality/cost ratio they end up with is well below what they expect.
seems risky for 20% savings (Score:3, Insightful)
A terrorist strike in one of these regions and you could see the company stock plunge because 80% of your IT development is done there. Seems if I were a terrorist this might be a good way to strike US economic interests.
Let's say your "partner" overseas decides to take the money and run. Do you then track them down and sue them in Indian/Chinese/whatever legal system? How successful will you be?
If something does happen to your partner, how long will it take you to recover? How much does it cost to have a standby?
How about exposure to other political instability? Don't India and Pakistan stare each other down with nuclear weapons at the ready every year or so? Isn't there a crazy little dude with funky hair in North Korea making missiles that can reach a lot of these regions?
How about all of the pissed off in-house talent who leaves? You've turned your real partners into adversaries. All that accumulated knowledge has left and you're now trying to rebuild it half way around the world? Does this make sense?
20% doesn't sound like all that much. You might be able to save that much by working on better managing your in-house resources.
This isn't to say that there isn't danger and uncertainty here in America, but overall it seems to be about the most stable environment to conduct business.
Don't forget onshore worker immigration (Score:3, Insightful)
While it's true the vast majority, if not all, of these immigrants are unskilled and will not be taking over IT jobs, they are taking over many jobs that would be filled by low income workers while driving down the wage categories at the same time.
http://www.denverpost.com/Stories/0,1413,36~116
So where are the savings? (Score:3, Interesting)
According to the article, the hidden costs of overseas outsourcing could cost between 16 - 65 percent of the total project cost.
I just don't see any savings here. Consider:
- Overseas consulting firms charge $20/hour.
- The average American programmer gets paid $35/hour.
The overseas firm charges 57% of what the American programmer gets paid - But, the minimum hidden costs bring that to (57 + 16) 73%, in the best case scenario. In a worst-case "successful" scenario (one in which the project comes in on time, without bugs..), the American firm will pay (57 + 65 = 122) 22% more than just hiring an American programmer. And to add insult to injury, should the overseas firm fail to fulfill its promises in any way, the American firm would have no legal resource against companies based overseas.And I haven't even gotten into the cases of project overruns, code delivered late, or in an unworking state, etc...
Offshore or Onsite Projects will fail if unmanaged (Score:3, Interesting)
But regardless of the fact whether its offshore or onsite all software projects are doomed to fail if there is no proper management in place. You can have a thousand people bang on it, but if you dont have a client who takes an active role in resolving issues, and identifying most needed features, if you dont have a team who is inspired and is capable of being focussed, If you dont have a manager who can lead and still be part of the team, every project is doomed to fail in the first few months.
One of my buddies who work for Kraft, USA recently told me that their project was recently outsourced to a firm in Russia. Now understand that these guys had more than an year and more than a couple of million to implement a solution the customer needs. But the weasel manager(whom I would blame here) who couldnt keep his team together and his client satisfied, chose to drop ball midway and outsource the project. They had all the time and money in the world to finish this project on time and now there are a bunch of guys out of work.
I cringe whenever my Director mentions having an offshore team handy when we talk to our (potential)clients. I feel he is not focussing (enough) on the positives of using our organization as a technology partner, but rather using the offshore model as an economical reason to justify taking projects offshore.
Recently I had the (mis)fortune of having to explain to a potential client about the feasibility as well as our internal processes when it comes to an Offshore project. Communication, I told them, is the key whether its offshore or onsite. I didnt mention the monetary advantages since to me, they exist, but i dont give a damn. For my client, I aim to make the best possible system with the best resources I have at the current time. And whether its done Offshore or onsite, I still aim to do my best. In the case of Offshore, I have to be doubly sure and have to push harder to ensure that the timelines are kept and the channel for communication remains open.
About the Offshore IT folks (Score:4, Interesting)
Dilbert pokes fun at IIT grads [indiatimes.com]
Contents:
Jokes apart, the ongoing backlash in the US against job losses to Indian techies has found a place even in the famous cartoon strip Dilbert, the latest of which (September 15, 2003) goes on to take a dig at IIT grads from India.
Asok, the brilliant but naive Indian trainee, the cynical Wally and the ever-sceptical Alice are sitting in the boardroom with the pointy-haired Boss. Asok says that though he was the project manager, nobody replied to his e-mail.
However, he is proud of the fact that he is an IIT graduate and considers himself superior to his counterparts and thus had been able to finish the project himself. When Wally asks him, "Are you tired?", he replies: "I am trained to only sleep during National Holidays".
And this spoof shows up the threat of Indian takeover in global arena specially in the field of technology. It also show up the Indian techie - the IITian - as he is perceived by his colleagues: a work maniac who has inhuman abilities to slog and thus outpace his American counterparts.
India's IITs have, of course, been the subject of admiration - now bordering on envy - in corporate America for more than five years now. A 1998 BusinessWeek article on India's whiz kids has this to say for IITians: "The rise of IITians, as they are known, is a telling example of how global capitalism works today. The best companies draw on the best brains from around the world, and the result is a global class of worker: the highly educated, intensely ambitious college grad who seeks out a challenging career, even if it is thousands of miles from home. By rising to the top of Corporate America, these alumni lead all other Asians in their ability to reach the upper echelons of world-class companies."
A researcher at UC Berkeley estimated that fully 20 per cent of start-ups in Silicon Valley are IITian-owned. Amazon.com CEO and founder Jeff Bezos has described the Indian IITian as a "world treasure." Bill Gates says the computer industry has benefited greatly from them.
Besides graduates of the prestigious IITs, where the quality of technical training is comparable to the best of the educational institutes in the world, India has a growing bank of 4.1 million technical workers, supplied by over 1,800 educational institutions and polytechnics. These train more than 67,785 computer software professionals every year - many of whom are a threat to America's homegrown computer jocks in the competition for jobs.
With the recent swell in outsourcing key software development jobs to India - coming on top of the BPO migration - a mixture of awe and resentment about India's brainpower is beginnning to develop. The American media have so far been mostly kind to IITs and IITians. CBS 60 Minutes had a very flattering portrayal of IITs recently. In fact, a co-anchor on CBS 60 Minutes had gone on to describe IIT Bombay thus: "Put Harvard, MIT and Princeton together, and you begin to get an idea of the status of this school in India."
But as usual, cartoonist Scott Adams - who draws and writes the Dilbert strip six days a week, is probably ahead of the pack in anticipating media and public opinion about IIT grads.
Here's the:
Dilbert strip [unitedmedia.com]
Re:Americans (Score:3, Insightful)
Re:Americans (Score:3, Funny)
Actually, last study showed Americans work harder (or more) than anyone else on earth.
Yes, in fact Office Space [imdb.com] is a documentary...
Re:Americans (Score:5, Informative)
http://www.businessweek.com/magazine/content/01_2
http://news.bbc.co.uk/1/hi/world/439595.stm
http://www.hartford-hwp.com/archives/26/077.html
http://www.cnn.com/2001/CAREER/trends/08/30/ilo.s
I found that an even more recent (2003) study that says south koreans work more hours but are not as productive.
Yes... (Score:3, Funny)
Re:Salaries are just way too high (Score:3, Interesting)
Re:Salaries are just way too high (Score:4, Informative)
Those ad campaings were produced by Verizon in order to sway public sympathy away from their (unionized) workers that were about to strike in order to protect their benefits. My wife, brother-in-law, and cousin are all techs with Verizon, and, believe me, they do not make anything approaching $75k/year. Possibly with 30 or so years with the company and 15-20 hours of over-time each week (if it is available), then they might the approach $75k. A better estimate would be around $40k/year. Hell, I wish my wife made $75k, my life would be much easier
Re:Hidden agenda? (Score:5, Interesting)