Discussion on:

Why I love offshoring and outsourcing

When you consider human evolution and behavior as a factor. This from "World 3.0: Global Prosperity and How to Achieve It" by Pankaj Ghemawat.

Dehumanizing. And sadly we are all buying into the "do more, with less" until we are wasting away doing something, anything with nothing...

Yeah, force americans to compete with people and corporations that pay essentially no taxes and are held to little or no environmental, legal or moral standards. All in a scheme to bankrupt the first world to establish neo-feudalistic enslavement for the oligarchs of the world.

Hurray, outsourcing makes me feel all warm and fuzzy now.

First IT was not the first discipline to do off shoring and out sourcing, damn ridiculous idea.
Advances in IT removed some of the obvious costs, principally transport, but not until all the various navvies and coolies who built the infrastructure were finished....
The real problems with this rose tinted drivel though.

There has been no significant increase in telecommuting. If there was we would have more of chance to compete with our colleagues on the sub continent.

Essentially IT personel costs have been reduced by creating an artificial abundance of 'qualified' people, leading to a huge drop in quality which is addressed by finding more cheap numpties to deal with the fallout. ie it's only more efficient in corporate financial terms. On an individual, regional and national basis, it's an outright distaster.

It is not a level playing field indeed outsourcing and off shoring are policies designed to take advantage of the huge discrepancies in living standards.

Last but far from least, this was a quest for cheaper, so now you have off shoring providers pandering to that mentality, and how do they do that, and even larger lowering of quality.

Doesn't worry me personally, because you aren't going to find that many people who can do what I do cheap, they don't have to you see....

"Similarly in the US the days where you could make a comfortable living working in a desktop support call center are probably over, but more challenging (and presumably rewarding) opportunities have arisen in their place."

The quote above suggests that there are more challenging opportunities now available in IT, but where do you expect those starting out to get the experience to handle those opportunities if the entry level positions that most of us started in no longer exist locally. The basic desktop support/call center environment is exactly where the majority of us learned the "trade", if those positions disappear completely in the local environment there is no opportunity for those wanting to start in the industry to learn the basics, and without a grounding in the basics you cannot advance. You even recognize that later in the article when you state "a high-level degree doesn???t always mean high-level skills". I've worked with a number of college students over the last few years who are working their co-op term and the level of learning has varied enormously when it comes to basic troubleshooting and configuration of a desktop OS. Most have been keen on learning but there's no way I'd send them out on their own to fix a basic desktop problem, let alone a server or network issue, even after completing the course, the skillset just isn't there. In order to develop the next generation of sysadmins, developers, security experts, etc we need to have the jobs to get them started and we can't do that if all of those jobs are based in India, China, or wherever the next cheapest outsourcing country emerges.

It is plain to see that there are many in the IT industry, that are more than a little disatisfied with outsourcing. So, for those of you out there making the "brave" though bottom line corporate drivin choice to send OUR jobs over seas, I challange just one large US based IT company to bring our jobs back home. Bring them back to the country who is proud enough to still care about service, and speaks the language native to our country. It's time to wake up America we have sold our souls to the devil!

The jobs belong to the company.

My experience with off-shoring was very negative. Our top company managers got tricked into this off-shoring fad and eventually had to pay the price, both literal and figuratively speaking.

Our managers were promised that the off-shore team was going to be cheaper and faster than our local IT guys. That was a complete lie. The time & material bills started pilling high very fast. The off-shore team was 25% more expensive than the local team. and their delivery dates were also complete rubish. Their lead times were longer than ours.

we ended up losing customers because of this experiment. Out of my own professional ethic I will not put company names here, I'll only say that our off-shore provider is one of the top BPO players in india. So, in theory, they should know their business, but all their marketing promises could not stand the test of day to day operations.

I fail to see the positive aspects of this off-shoring thing. Maybe because I got to actually live through it and do the clean up and damage control that resulted from it.

These so-called off-shore companies in countries like India or China believe in solving everything by sheer brute force. Sure they can hire ten "IT guys" for 10 cents/hour to solve every single little problem, but that its simply not the way to go. The skill set is non-existent and the mind set... well, let's not even go there.

I've been around the block a few times. I've had my share of bad and really bad customers like everybody else. But having to work with these so-called "Off-shore IT professionals" that barely speak english, had zero customer service attitude and on top of everything, had a very high opinion of themselves with not real knowledge to back it up is by far my worst experience in IT.

The politically correct people will cringe at my comments, but there are also many many more that feel the same way I do. My hearth goes to you guys. as the saying goes... this too shall pass. but God... why is it taking so long?.

Peace!

interpreted offshoring as can now get rid of all the people who managed the onshore effort. I don't mean the MDs' nephew who once write a macro, I mean the guy who knew where all the printers were , who used them and when. The guy who wrote the inhouse software anw was intimately familiar with why as well as what. Most of these disatrously failed offshoring efforts happened because business's threw the baby out with the bathwater. And why, because it was cheaper. They didn't get fooled by unscrupulous "indian" vendors they created them. What other option but to cut quality were they left with in the eternal quiest for cheaper, hire Chinese or Koreans?

All this talk that outsourcing failed because of cultural and language barriers is a lie, it failed because incompetents are cheaper than competents, that's it. It was "our" culture that cause the failure not theirs.

For an even less politically correct statement Tony should be your first port of call...

It worked like a charm.
Back in the day they had to do some serious hustling to lower the quality... you know, so they can re-pack the same-old-same-old as "new and improved", or even better, as "original".

Now they invented this crazy scheme, and suddenly we're none of us surprised at the drop in quality.
And the fat cats can point at each other and say "We know, it's like totally terrible, but those other fat cats are doing it, so we *have* to follow suit".

I'm telling you, it's a brainwave!

I was working back in 2003 for a Compaq house and moved to a Dell house. OMG the difference between Compaq in Ireland (still abroad but with a closer culture to our own) and Dell in India was massive... With Compaq I could, in one breath, explain a problem and then how I had tested to check my hypothesis. With Dell if I do the same even now almost 10 years later I get a dumb script and no understanding. It's no good. Also if you outsource there is a pressure to not report the little things until they are blown out of proportion or just solider on.

The idea that someone miles away can know the users and get the systems familiarity while doing it cheaper AND making a profit is not common sense.

I always want to reply, "Hiya Bill, my name is Hadji..."

I won't name my employer, but its a name all of you know.

My division did an experiment with outsourcing to India. It ended up being a very costly experiment that ultimately failed. Among the problems; customer resentment at people whose english isn't very good, when they pay thousands a month for support, high turnover where people went through months of expensive training, and then left for an offer down the road for a few cents more. Our customer surveys, which help drive our business, forced us to change the plan, even though it was an experiment to start with. Now that much smaller group does remote administration tasks on customer's servers during the off hours.

But to stay competitive, our division has been doing something else. Its been opening work sites in areas where there is a good IT workforce, but a lower cost of living. It has been hiring people who can work from home to lower the expense of renting space. All of this has allowed us to be competitively priced, but not to rely on an offshore workforce.

Some companies are getting this point
http://www.sltrib.com/sltrib/money/52040064-79/expansion-flash-jobs-utah.html.csp

...problem I was having by calling and getting an offshore person from Asia.

Finally, got someone in Ottawa and the difference was noticeably refreshing. He was able to communicate intelligently and resolved the problem in less than an hour.

Which taught me a lesson. Never call after-hours - you'll get re-directed to an off-shore team which is an exercise fraught with frustration.

Patrick,

Please read this: http://www.scribd.com/doc/20966921/Guest-Workers-Exposed-Chapter-3

And the other chapters, if you have time.

Enough said...

Outsourcing may be good for the business owner, but not for America, aka, WE THE PEOPLE.

Are you INSANE? :0((

I see no mention of what happens when you send American dollars overseas. If you are exporting more dollars than you are bringing in then you are bleeding money. This is not money we can earn back. The loss of jobs puts more people on unemployment. I see this being a major factor in the struggling American economy. All the politicians want to talk about "creating jobs" but we have all the jobs we need. Instead of waiting for this magical "job creation" the CEOs need to decide that Americans are worth hiring again. Keep some money here at home. Hire Americans. Pay your taxes and stop complaining about it.
" "
Writing this article is a disservice to the nation.
""

Why do we not tax invisible imports such as every phone call made to or from a foreign call center on behalf of a domestic company - to be paid by the domestic company, they are imports and exports. This would allow domestic companies (regardless of the country) to put quality first and create money to sponsor domestic job creation. If outsourcing has to occur domestic outsourcers would have a good chance so there would not be a foreign drain on money and skills. With a level or nearly level playing field foreign outsourcer would also be able compete on quality. A win all round, although I am convinced that there is a greater benefit to internal IT with a focus on customer service and a yes attitude.

Are you mad? Indian IT professionals are paid wages FAR below the minimum wage HERE, and without benefits so American management thinks it is getting one helluva salary bargain, and only THAT. Those invisible productivity expenses when servers crash, email fails are just tooooo hard to add up. "Just make phone call, fix Windows problems cheaper,faster,better" I was told on a message board. Oh, as if all Windows problems = reboot. But why should American IT professionals and career entrants even desire this field anymore when, despite your BEST efforts and certifications, you are likely just an OVERPAID AMERICAN IT PRO who can be outsourced. Offshoring and outsourcing has destroyed information technology. Witness AstraZeneca at IBM. Among many others. Infrastructure projects outsourced through SAIC such as CITYTIME are disasters of the first order. Internal IT no longer exists and I was part of an internal team at Aon Group that was putting the network back together on September 13, 2001. Remember the event 2 days before? World Trade Center techs (I was one) were busy re-assembling the network. Let an outsourcing firm do that efficiently!!! Hell, there would be a ton of impact reports and studies to do. OFFSHORE and OUTSOURCE have destroyed IT in America.

I believe that Mr. Gray may be correct. I believe that most of the managers that have sent IT projects and customer services off-shore either have or are in the process of being replaced which would improve IT in general.

I know that my company will pay a premium to buy products from companies that do not send their customer services overseas. A case in point is "Clear Wireless". When they (Clear) first came to my part of the country, there was absolutely nothing wrong with their customer service. However about a month ago there was a problem with connectivity for one of our sites. I spent three hours with a customer service person that clearly was not bi-lingual before being connected to someone that could communicate clearly in English. Once connected the problem was resolved within ten minutes. We were strongly considering ditching our DSL and going with a totally wireless solution, but have shelved the plans because of the support.

While I am on my soapbox, I would like to add that not all of the poor customer service comes from overseas. I have worked with a number of people that were able to graduate from high school here in the United States but cannot speak or read English well enough to provide viable customer support.

So... you want to earn $30 K per year as an ERP Implementations Consultant, dedicating 3500 hours per year to work (2700 billable hours, and 800 lost, unpaid travel hours), do you!?!? Do you think that salary equality caused by second world nations will mean cost of living decreases in first world countries???? I say "you would change your story if this had directly threatened you this way!"

And, if offshoring and outsourcing is not enough (as they have hardly worked in my consulting world), my firm has now decided it's more profitable to them to create any fictitious excuse they can to undermine & remove a North American consultant on North American projects, and replace them with someone from India, who they move over with their family and give legal residence to! It matters not what quality of service is delivered by the replacements versus the North American consultants. The client also is not going to receive a reduced hourly bill rate. The sole objective here is profit, and service quality is far from even secondary.

So, although I do believe in free speech, I'd like to say "Stick a sock in it Sparky!" It sounds like you are trying to justify using folks from India than your neighbours... that's about it!

Hiner must have called up Patrick and begged him to write a more inflammatory article than the one he wrote the other day to get the heat off himself!

Don't play poker with a pair of jokers.

Yeah, outsourcing/offshoring is a good thing and makes us update our skillsets. That's why I went from being an email support rep for netcom, to being a desktop support rep for Netcom and Kensington, then a helpdesk engineer for a variety of companies, then went to the NOC at Internex and then became a SQL and Access dba, only to see each of those jobs outsourced and then offshored. Of course, this was AFTER my career change from the inventory management and control field after THAT industry (along with the manufacturing it was tied to) was sent to Asia. So, Tony Hopkinson is right. IT wasn't the first field to be sent overseas to the dirt cheap labor pools. And it isn't going to be the last if a certain political party has its way.

I was involved in a reengineering project in the mid nineties that removed $3.5M hard money from an $8M dollar budget. All the staff reductions were done through attrition and the remaining staff were happier since they had all the c**p taken out of their work and were really making customers happy. Our team asked what was next; we were told that the execs liked everything else the way it was and the team was stood down and over time the design that was put in place was violated by management that was trying to make things "more efficient." They wound up in the same place - doing wrong things for "good" reasons.

My point - what is good for one is good for all. I would like to see executive outsourcing for those who cannot seem to create efficient domestic operations - that may be the key to saving American workers jobs. Many of the excellent operations and high quality manufacturing jobs are in Asia. CMMI Level 5 shops abound outside America. Why not spread some of that know how back this way.

This article was brought to by Corporate America. Corporate America, looking for new ways to put Americans out of work, everyday.

And by Wall Street. First we brain washed your bosses into making you and your wife work 60 hour weeks for a flat rate, now we ship the job overseas.

And by the Republican Party. Making sure you are paid so little that you can no longer afford the product we sent overseas to make it cheaper. But we can afford them.

Too much injustice and corruption in the name of the share holder. We need real profits, not money shell game.

Man, what a corporate tool! I bet this guy laughs at his boss's jokes VERY loudly! Yep, capitalism at it's finest - slavery.

We do need to embrace the off-shoring and outsourcing??? I???ve never been busier; fixing the problems that these clowns are creating. I look like a hero nearly every day!

Their work is clearly inferior, like 1) A nested loop that can change the counter on the outer loop causing infinite resource consumption/server crashes, 2) an onshore outsourced developer that charged 53 hours over a 5 week period to write four lines of code, or 3) an estimate of 2088 hours to construct a simple application, nearly identical to one that took me just 30 hours to develop.

Apparently our company can afford to bleed money to pay for these idiots and can still afford to pay me to fix it. My big complaint is that I could develop much better solutions at a much lower cost and be working less overtime.

I will agree that outsourcing can bring new affordable/creating ideas and technology into some situations (i.e. global communication networks, call centers...)

My office is nearly 1/2 contractors on Visa's and many other hundreds are off-shore. I cannot comment much about the off-shore, since I don't directly interface with them, except for trying to understand them whan I need to call for "Help Desk Support" (i.e. name is Brown.. B... B...B....R....R....)

I do not mean to insult those who have been hired to replace those who lost their jobs in my local community, but many of these replacements are very much less experienced, while thier company is paid nearly the same rate, and sometimes more!.. Then every few months we have to retrain their replacement when they have to return back to their home country.

I enjoy listenting to interviews of Bob Lutz (formerly GM exec) who often criticizes the "bean counters" of excuting bad decisions based in purely economic ideals. There lately seems an uneven balance between cost savings vs. productivity and future product development...(short goal savings being the winner)

I guess this way, the CEO's, and partners, can cash out with bigger parachutes!... and payoffs from their outsourcing partners? Kind of like Congress, of which I visited last year and personally complained about this outsourcing issue!

We need lots more Outsourcing and preferably Off-Shoring. Currently there is way too little if any of this actually occurring.

We need to move all forms of Upper Management Off Shore where they are less capable of doing any real damage to the company/country.

Ideally every CEO and lower in Management and Ideally Every Politician needs to be Off shored as quickly as possible and removed from any form of communication with the Company/Countries. If we can achieve this we will get a Considerable Reduction in the Cost of Management to little more than Loose Change which will be a Massive Improvement to the Companies Bottom Line and as a result better Managed and More Profitable Companies where Golden Parachutes are not only Outlawed but Completely Nonexistent.

After all we need Workers Locally to deal with the customers after all just how well would any potential Customers accept needing to send their new purchase away overseas for several months when the new product was found nonfunctional out of the box?

So we keep the Sales and Technical Staff here and move the Loss Making Management overseas where the costs are so much lower and the return for the company so much higher.

We could bring these people to the Companies Head Office once every 5 years and Fire them from their Positions for Complete Incompetence, then we do not need to comply with any Long Term Employment Requirements in the Countries that the Companies do business in.

Just tell me which is better laying off several thousand workers to save money or 1 Senior Manager which results in the same cost savings? Despite what the Management claims none are worth the money that they get paid per hour and it would be possible to have an entire company overseas for the cost of just the CEO let alone any of the other Upper Management.

Caring on in this vein we could also Offshore all our Politicians and get better Governance with a much reduced cost of Employment of Politicians and certainly no long term Upkeep on failed or retired Politicians.

It would also destroy any possible Hate Politics as there would only be one side speaking and if we where really cleaver we would prevent them from making any speeches or statements in the country that they are supposedly Governing.

The perfect Politician can't do Anything detrimental or otherwise and cause Division in the country that they are in the process of destroying. Better still the destruction of the country would be prevented and the necessity of Expensive Elections where so much money is wasted by Lier's claiming that they are more truthful then their opponents would be prevented.

About the only looses would be the Advertising Agencies who run the Advertising for these Criminals which we could also Offshore and get rid of them all completely.

Failing that every second year we should build a big rocket fill it with all of the worlds Politicians and send them to the heart of the Sun on a Fact Finding Mission.

Only possible problem with doing this is it is very likely to cause the destruction of the Sun by all of the Pollution that we are pumping into it.

Only possible issue is we would need to find a place where there are no other Humans to send the Off Shored Politicians to so that they could not adversely affect any other Humans. Ideally someplace several hundred feet underwater with no survival equipment would be ideal if only we could prevent the complete Ocean Environment Destruction.

All of the Subspecies of Humans called Politicians are just do damaging to everything that they come into contact with.

Col

Everybody else is screaming like their dicks are caught in a zipper.

winces from your male readership.

You think this was maybe Patchrick playing the uproar game then?

And it worked, Tony.

We're canivores so we bite...
Evene the vegans can't still the reflex.

But then again I am a woman, don't have a US centric view of the world and I have seen outsourcing and offshoring work. I have heard my IT sisters scream about this as if their uhm what is a comparable analogy that is not sexist nor censor worthy - their Made in China knockoff designer handbag didn't match their Made in India silk embroidered blouse.

I am not completely convinced regarding the comments from another regular that the cultural interactions in IT always work well, I worked for one of the big 3 outsourcers with the 3 letter acronym taken over by the one with the 2 letter acronym. The 2 letter corporation doesn't know what a service is if it bit them on the posterior area, most layers in the organisation just care about making a buck and who gets the sale. Tin company running on a Sharepoint architecture with catch and despatch offshored; selling widgets. Here comes my point, I am verbose for a reason - the American corporations I have worked with and in oftentimes could not see beyond their borders at all. I have observed this in several American companies, pricing services based on the American market, the Amercian cost, the American way of doing things (i.e. centralisation, data centres in the US, costly pipes, costly support), forcing it on the rest of the world. So I suspect that this is why some of the responses are of such a dick in zipper volume. I've also had experience with call centres and service desks located in the US that were not very successful.

I also think that thais black and white thinking (onshore always good, offshore always bad) is a self fulfilling prophecy that is an iron maiden of belief in some form of superiority. I don't believe this attitude is always of value.

We all outsource, in our daily life, in our business ventures, on a corporate level. Some services can be offshored and outsourced, some may not be able to be offshored, it is about finding the right centre of expertise at a price point that is a) viable for the corporation and b) is acceptable for the client, as the client often demands a lower price.

From an access and security of data perspective, I would have some concerns about recommending some of my clients to offshore data to the US due to the Patriot Act. I have recommended against using American companies for the provision of services that involved offshoring data to the States. It all depends which side of the looking glass one finds oneself.

I get it too.

M'lady.

Outsourcing may be a godsend for short term projects but for anything more, it is simply a means of avoiding the responsibility of employing and supporting an employee--Lazy management, cheap resources without worrying over employee relations of benefits. So at 50, I became too old for IT. I was lucky. Others bombed out at 40 or even 30.