Outsourcing : A perspective

I have been patient and very careful not talk about anything controversial in my blog, but I think its time to throw my towel in because I believe I can offer a balanced view about outsourcing. Heres why I think Im qualified to talk about this topic.

In my career in product development company I have seen the following

    * I started off my career in India @ the indian branch for 1.5 years. Worked with american clients from India.
    * Was transferred to US operations and have managed projects developed in India from the US for clients across the globe.
    * Have been involved in both successful and screwed up offshore projects.
    * I have been preview to projects outsourced by our clients to India (good/bad projects).

In my current role

    * Work as a consultant in a Fortune 500 company where threat of outsourcing in real.
    * Work with outsourcing partners.

I know its a subject that people are passionate about. I am going to try very hard to project a balanced perspective and hence would appreciate if would do the same while you comment. I want to divide this writeup into 3 parts,

   1. Rebuttal /comments to Sue’s blog entry
   2. My Experience with outsourcing.
   3. Suggestions

Rebuttal /comments to Sue’s blog entry

IMHO Sue’s article overall presents a one sided picture of the situation, although some portions seem pretty balanced. Either Sue has had a bad experience or its plain jingoistic(Theres nothing wrong about it) I have been very cautious in making sure I read the article in a non personal manner and get a grasp of what she is saying. She has extrapolated her bad experiences to the outsourcing world. Here are quotes from her writeup

1. The fact that a US company thinks that hiring a barely-English-speaking worker in India or the Philippines is going to solve their competitive problems is just absurd

Well for one I dont think our vocabulary is as bad as it being portrayed. Sue might have had a bad experience but generalising the experience is Absurd. Infact our use of english is why companies are coming to India. Heres the fact to prove it

Other factors which give India an edge include its use of English and the quality of its product, according to IDC.

If your talking about pronounciation, then that is true even when you are working with someone hails from outside that US but is working here. Have u ever spoken with some mexican customer service reps? (Nothing personal)

2. Well in reality it was, and continues to be, a terrible idea. The ‘fully qualified’ engineering team was not even close to qualified.

I wish she had explained the term “qualified” Is she talking techincal skills? Business skills? Customer relationship skills? Agreed that there are some companies that hiring freshers out of  school who do a piss ass job of training them to make a quick buck, but that does not mean Indians are not qualified. It boils down to how the project is being managed from here and the person managing it it india. The bottom line is chosing the right vendor when u ship some project offshore. Heres another report to prove that jobs are being sent to india due to the analytical qualities

Although India is expected to retain its leadership for the foreseeable future, its strong rating may be tempered by increasing labour costs (so far offset by reduction in telecom rates) and geopolitical concerns. In the long run, India is likely to become the location of choice for high-value analytical tasks, while generic commodity processes will move to lower cost environments, such as China

3. When the high-tech people being displaced by these policies don’t have the income to purchase the products being made off-shore, who exactly, Mr. and Ms. CxO, do you think is going to buy your stuff? You think the worker in India is going to run out and buy it? I doubt it

Too bad Sue does not have her facts right, if you thought Indians dont have the buying power, you are sadly mistaken. Heres the yesterday’s report by Time.com

India’s young are becoming world-class consumers, and multinationals are taking note

4 And by the way to HP: having an AP rep on the phone for 20 minutes from India to Colorado is not, perhaps, the cost savings you folks intended.

Either she does not own a cell phone or has never spoken a representative, she makes it sound as though being on the phone with a customer service representative is abnormal. And isnt she used to a heavy accent customer service representative .. Gimme a break! If things were so bad as she is talking about then why are so many companies going to India? Are companies ready to lose their clients to save money? I dont buy it! She should probably subscribe to this blog to keep track of call centers in India.

5. I think these visas should be abolished until all of the unemployed and laid-off IT workers and engineers who are US citizens are back on a payroll.

I like her passionate appeal, but it does not make a lot of sense. Am I all for reduction of numbers of visas? Sure, the economic factors drive the job market and hence have a definite impact on the number folks coming in. Am I all for punishing companies that misuse L1 visas? Hell ya, it is gross misuse of the transfer visa and hence it make sense. Immigration is the fabric of this country and Sue’s ancestors must have been immigrants.(Unless she is red indian, if so I forgive my assumption!)

Im rather surprised at the advice that she is offering.

And if you must, quit the job. No two weeks notice, just flat out quit.

Now how many people have the luxury of doing this? Thats good free advice cuz she aint working for someone she runs her own company.

When you are about to buy a product, call the company and ask them if they outsource their IT and their customer support before you make the purchase. If they do, then simply don’t buy the product.

Wonder if Sue runs windows? If she does she better stop using it cuz lot of development and customer service is done in India. Lot of temps in Redmond are from offshore companies like Aditi @ bangalore. You wont be able to most of products.

I’m sending a copy of this blog to mine right now. Let them know that the issuing of foreign worker visas in the high-tech industry has to stop.

Is she against jobs going to India (which is offshore) or Immigrants like me coming into the country to work. There is a big difference, one can use the same visas to come into country either come collect work and get back or work here as an employee of a company like I did. My guess is she is probably BOTH.

It has turned out to be a longer entry than I thought and hence I will address my other items in the following days. But before leaving I would like to address an important question that many of my readers would want to ask me.

How would I feel if jobs in India were shipped outshore to maldives and east timor? A fair question that any pissed american would want to ask me.

Infact there are many africans, bangladeshies and Srilankas who come and take our jobs in India. India does not even have a proper immigration system in place. Would I be upset about it? To a certain extent I would be. India’s fabric unlike US is not based on immigration. But one cannot use that as an excuse for long cuz, the world is smaller place right now it not just the country any more so one has to be prepared for it. It just the world economy, it is intertwined now whether one likes it or not. The best option is to be prepared for it and be adapative. Either adapt or become extinct. Today its India and China, tommorow could well belong to some country that we dont know about. It is ok to be passionate about it but IMHO Sue was writing to a wrong audience and she knows it as well. Java.net is not a US community it is an international community which she mentions herself in her first blog entry. Talk about  world  shrinking and becoming a smaller place 🙂

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7 thoughts on “Outsourcing : A perspective”

  1. Sounds like you are making a huge deal out of something that isn’t that important.

    She’s had a bad experence with outsourcing so she won’t use it. Great! I’ve had bad experiences with Gateway so I don’t shop there. Same thing.

    Nothing to see here, move on…

  2. Mr Noone .. If we just had to move on opinions would not matter. Well for starters if she wont use it, it does not matter.. the reason for the rebuttal is talking it up a notch. If it was a fair & balanced view I dont have issues. Is it too much to ask for?

  3. Let’s face it, IT salaries in the US are ridiculously high, and this for a good reason: If you have to pay two or threehundredthousand dollars to live in a Seattle shithole plus you wanna buy an SUV to not be a minority amidst your outdoorsy colleagues, then you better get paid in full, which is I’d think 10 to 20 times of what you’d get in India (I don’t have a link handy, but replace 10 with any number you think is right).

    Now why would I not outsource a project? That people from all over the world can work together remotely and successfully is demonstrated in open source development everyday. I think in the last years people just make their first experiences in IT outsourcing. At the moment, some are successful and some are not. I lost my last job with about 100 others because the company was outsourced to India and what I hear it is going well without us. I kind of think that in the long run outsourcing to cheaper labor countries will be standard and therefore, being “adapative” is really the key here. I don’t think a “hire american, code american” attitude will help much. I think we need to accept lower salaries in the future or the US might get singled out from the worldwide software development process. Of course, having your development team local is more productive, but once you have figured out the cheap way, why wouldn’t you?

    Now wouldn’t it be nice if houses would just cost a tenth of what they cost in the post dotcom era. Then we could all be happy getting just a tenth of our salaries. We could continue on having jobs. We couldn’t blast away 10.000$ in a 2-week Cancun vacation anymore, but at least there’d be no outsourcing.

    Maybe it will all go like this: Dotcom -> everybody rich -> Living in US too expensive -> US salaries too high-> Dotcom over -> US Companies try outsourcing -> US companies try outsourcing successfully -> US companies lay US workers off -> US workers cannot afford living anymore and need to sell their houses -> Real estate market collapses and property becomes cheaper (+everything else) -> Living in US becomes cheaper -> Lower salaries are acceptable -> Job market picks up again (and the exact opposite happening in India over the long term???)

    Uh, I’m no good in business.

  4. Indians may have purchasing power within the Indian economy, but there’s no way they can buy the MNC’s products at American prices if they are being paid third world wages. Indians may currently being leading the race to the bottom, but they will lose that race to China. And the world population will be knocked down to the lowest common denominator in the end. Here in the US I just bought a bottle of Nyle shampoo for almost $6 US. I’m sure it doesn’t cost that much in India (or any of the other Indian brands on the shelf at that store). If India had done the same with its labor (priced it so as not to destroy the local job market but competed more on their merits) nobody would be angry at them now. Undercutting the US worker by a factor of 5 to 10 does not make the Indian worker better, only cheaper. Americans are tired of being unfairly forced out of professions and companies they invented or built. This IS a war.

  5. Betsy,
    I suggest you reading the purchasing power article before making pronouncements! It is sad that you have chosen to voice your passionate opinion and have missed the whole point of my writeup. I can understand your irritation but cant understand your reasoning of judging an indian worker. I find you reasoning pretty short sighted.

    If this is WAR so be it, there is nothing that anyone can do to stop it now.

  6. Silence Or Compliance
    Raymond Donald Pairan Jr.
    Copyright (c) 2004 All rights reserved.

    INTRODUCTION
    This paper is just a further elaboration on some of the topics that I presented in my work entitled “The Economy” which I hope has inspired the moral, the passionate, and displaced future working slave class to start inquiring about their ultimate condition within the hands of the business/political elite. It is absolutely wonderful that certain members of the media have started to question the direction and motives of the business/political elite and have beat the bushes where they’ve been hiding thus exposing their true motives to the clear light of day. But make no mistake the business/political elite will stop at nothing to eliminate any opposition be it ethical government, the media, or any other encumbrance that inhibits them from achieving their goal of creating a subservient working class and a contrasting unencumbered business/political elite power base.

    SILENCE/COMPLIANCE
    At this point in time the media has the business/political elite (forgoing referred to as the controllers) on the defensive at least within the United States, which is in the mist of a presidential election year. Make no mistake the controllers would like to and will eventually silence all media dissent against their planned worldwide domination of all elements that can negatively effect their goal of sucking every last drop of revenue from the world into their realm. If this means devising a means of quelling dissent from those within the media that don’t wish to go quietly with the controllers view – so be it. Keep in mind that money and power are the driving force of the controllers and everything and anything that inhibits their eventual control over these elements in their eyes must be eliminated. This could mean the off shoring of media jobs to compliant outlets such as India where in the case of the English speaking world there exists a future working slave class that speaks English rather decently. The controllers could then eliminate media disseminated descent to their plans of complete global control over all the factors of production including the eventual working slave class. This means that no job is safe from the plans by the controllers to evolve all jobs into mere subservient, compliant, malleable factors of production. Time is limited for the controllers and others that support the free trade (code word – free) subjugation over all workingmen and women. The ideologue’s within the future working slave class will blindly follow one another lock step onto the slave ship that will set sail for their future of no dissent, compliance, no morality, no freedom, no future but one of subservience. The time is very near at hand so those within the media that are the moral voice of dissent must take our case to a fever pace in order to expose and keep all rouses from becoming the new molded distorted facts that can be espoused by the controllers. For the controllers their religion is money and power because for them nothing else matters. If they can gain control over not only you the educated working, the hard factory working, the service sector working, then they will be free to build a truly worldwide free market economy where they are free to do what they wish when they wish it.

    BEND THE TRUTH LIKE LIGHT THROUGH A PRISM
    If you say something enough and if you change the dynamics and distort the facts to your liking then eventually it will be believed by enough people to become the truth. Basically, the controllers just prior to taking complete control over all media dissent will be hard pressed to dispute facts such as 3 million jobs lost in under 3 years, poverty within the United States at record high levels, whole town centers across rural America with a preponderance of vacant store fronts, a trillion dollar deficit, most states within budget crisis, a college education now getting further from the reach of most Americans, and the list goes on and on. Historically speaking when facts don’t convey what the power elite (in our case the controllers) wish than they just change the way those facts are presented so they convey a distorted picture favorable to those in control. This is nothing new and has been employed quite successfully by those in power many times in the past in the form of propaganda. We must maintain focus on the standard measures used within the past and not let the seeping of new measures (touted by the controllers) distort the facts.

    THE TIME IS NOW
    It is imperative that we work with the media while it is still free to convey the truth about the controller’s objectives and goals. Time is quickly running out for the average working citizen to maintain some semblance of influence over their respective governments. The controllers will and are gaining control over these governments covertly, directly, and through draining the government treasuries converting partially effective governments into impotent shells of past power. Once the controllers are finished with governments than even the political elite will be at jeopardy of becoming obsolete. So those within the political elite may be enjoying the fruits of soiled money conveyed to them by the business controllers but make no mistake once the business controllers have achieved their objectives they will dispose of even the political elite thus eliminating this drain on their coveted profits. There exists one goal of the controllers and that is to extract and drain as much wealth from the world as is possible. The controllers have no God, no religion, no morals, no scruples, and no conscience but only one overriding unquenchable desire – the complete control over all aspects of their bottom line. They will stop at nothing to satisfy their additive need to acquire more and more wealth at the expense of anything that gets in their way. Any worker that is currently employed by a firm that has global reach over its factors of production (and this doesn’t include many small to medium sized firm’s playing by the rules) are at risk of being eliminated. This includes every imaginable profession since there currently exists the technology and desire (by the controllers) to out source any profession – first and foremost the media (the thorn within the controllers side). It is imperative that in the next few weeks and months that all of us that count ourselves among the working class keep abreast of issues, meaningful relevant facts, and not be swayed by propaganda spewing from the controllers. We must make our voices heard through written, vocal, and peaceful dissent to the path that the controllers are leading us down. We must not and cannot follow the controllers blindly into a future of no government and working slave subservience. Remember the controllers will use key phrases such as “free market”, “household survey”, patriotism, and many others to sway global opinion towards their way of reasoning. Also, keep in mind there are many honest, decent, caring employers (mostly small, medium, and large sized businesses) that are playing by the rules and respect their workers, and communities. It is probably only a few but powerful firms making up the Fortune 500 that are the real controllers of a destiny of worker subservience. I will continue to write the unpopular truth be it what may come. You should continue to question, reason, and judge the facts and not be swayed by propaganda. Let the facts speak for themselves because they surely will if given the chance!

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