CXO

Offshoring: Why it's an opportunity, not a threat

IT industry experts in the UK argue that offshoring shouldn't be viewed simply as a threat to domestic jobs but as an opportunity to join a global workforce.

Offshoring should not be viewed as a threat to domestic jobs but as an opportunity for tech workers to adapt to new roles as part of a global workforce, according to IT industry experts.

The practice of using overseas labour to fill certain tech roles doesn't necessarily mean a net loss of jobs, a recent debate at the BCS, the UK-based chartered institute for IT, heard.

Elizabeth Sparrow, past president of the BCS, said there is "a danger that we try to cling onto jobs as they exist today. It has not stopped evolving. We need to be looking at the jobs for tomorrow."

The BCS cited research that it said shows new jobs continue to be created onshore as other roles are sent offshore, with one piece of research claiming 750,000 jobs in finance, IT and other areas will be offshored by 2016, while a second predicts a total of 225,000 jobs will be created in cloud computing by 2015.

Business intelligence specialist Gary Nuttall said that offshoring software development doesn't have to mean the onshore staff disappear: "A number of my experiences have been on 'follow the sun' type projects, where each team involved passes on the project for development. When you turn that around the UK just becomes part of that chain. So we are talking about the threat of outsourcing software development, but it may be that we are part of doing software development for others...certainly in global organisations I've seen that."

As offshoring is a reality of modern IT, interim CIO Karim Hyatt said that there is a need for western IT staff to become more comfortable working alongside colleagues working offshore.

"I've had this experience with a highly trained Swedish group of gaming professionals and they stated that one developer in Sweden is worth three in India. But that wasn't true and they had no basis for stating that. This is the attitude that needs to very quickly change."

The way companies view offshoring is also changing, the debate heard, with Nuttall saying that companies have discovered that offshoring doesn't always save money, as while " things may seem cheaper at first, the controls also add overheads".

Companies could avoid some of these unforseen problems with offshore vendors by adopting an outcome-based approach, said Nuttall.

"I think in future contracts will go down an outcome based approach where as long as the code is produced to the required spec, does it really matter what qualifications the developer has in the past? I use the Kwik Fit analogy - if I have my exhaust replaced I go to a specialist, they give me a price and a time. I don't analyse the mechanic's qualifications or a schedule of what they are doing - all I want them to do is deliver on time and on budget and that they phone me if there is a problem."

Part of the reason that the IT industry has to accept that offshoring is here to stay, Hyatt said, is that companies are forced to look overseas to fill certain roles, as the skills are not available in their home nations.

"IT isn't viewed as cool as it was in the 70s and 80s. In the software product area you sometimes, for example in gaming, need extremely specialist and clever people. Real techies. They are difficult to find.

"If you go to India you are getting 500,000 IT graduates per year and if you go through the recruitment exercise the people are out there. So if you want a large team of developers you are more likely to be able to do it in India than the UK."

Sparrow said that offshoring could be viewed as a natural offshoot from the transnational nature of modern business.

"For me it is one example of a globalisation movement. There is work that can be done around techniques and standards around offshoring. But there is also how to work in a global setting, when perhaps the majority of your customers are not in the UK."

About

Nick Heath is chief reporter for TechRepublic. He writes about the technology that IT decision makers need to know about, and the latest happenings in the European tech scene.

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