Outsourcing IT work

[JennyFine]

I don’t come across negative attitude to outsourcing IT work very often, but it’s still interesting to hear what people have to say against it (or for it). I know that some are concerned with the loss of domestic jobs because offshore workers are cheaper and equally capable as domestic workers and many corporations already replace their employees with cheaper offshore workers. But that’s more a question of morality. I wonder what else can keep you from employing an offshore worker…

[tceperry]

But that’s more a question of morality. I wonder what else can keep you from employing an offshore worker…

In addition to the issues you covered, there is the issue of culture and language. I have already had several bad experiences dealing with VERY OBVIOUSLY outsourced tech reps. All the "thank yous" and "pleases" in the world will not make up for someone having you rephrase your problem three and four times. "So, is I am understnding that you are having difficulty with ....."

As a business owner, I understand the dollars, but also as a business owner, I believe that outstanding service is more important. If you can't give outstanding service and still make some money, you are not doing your job.

So...what else would keep someone from outsourcing? For me - total quality over the almighty dollar.

[JennyFine]

I understand your concern about language and culture. By the way, would you say that I am actually not from the States myself?



In addition to the issues you covered, there is the issue of culture and language. I have already had several bad experiences dealing with VERY OBVIOUSLY outsourced tech reps. All the "thank yous" and "pleases" in the world will not make up for someone having you rephrase your problem three and four times. "So, is I am understnding that you are having difficulty with ....."


As a business owner, I understand the dollars, but also as a business owner, I believe that outstanding service is more important. If you can't give outstanding service and still make some money, you are not doing your job.

So...what else would keep someone from outsourcing? For me - total quality over the almighty dollar.

[tceperry]

I'm not against people from or in other countries. My point is that when these jobs are outsourced, the quality of service is no longer under my control.

Quality can suffer in many forms (both in the US and outside); however, if I have an employee who is not truely fluent in English, or who cannot quickly understand a problem and deduce several possible solutions, I can make an immediate change. I have very little control over the outsourced jobs, especially those sourced overseas.

Maybe I am in the minority. Maybe my negative experiences (with four different reputable companies) is the exception. But it is the information on which I base my opinions.

[MekhongKurt]

Outsourcing is a touchy issue, so I'm a little hesitant to step in, as I certainly don't want to offend anyone, no matter his or her personal views on the subject.

As I recall, something on the order of 2,000,000 Americans live outside the U.S. and its possessions. No doubt, some don't work -- I'm an example of that category myself. But many American expatriates do work, as I did when I first came to Asia 19 years ago. (And I still live in Thailand.) In that sense, American expatriates who do work are the foreigners, undoubtedly, in some instances, filling a position a local national could fill (and often for a much less expensive compensation package than those we expect).

And other countries do some direct outsourcing to U.S. companies; look at the Middle East oil industry; a lot of the equipment comes from America.

So, outsourcing/job displacement is a two-way phenomenom, to a degree.

Those things said, of course quality control is much harder to stay on top of if you're somewhere in the U.S. but, say, your helpline is headquartered in another country. From what I've read in various e-newsletters, magazines, newspapers, etc., many companies are taking complaints about their employees abroad very seriously. But it will take time to handle those issues.

Consider language barriers, for example. I taught English as a Second/Foreign Language for quite a few years, most right here in Asia. My former wife, a highly intelligent lady from Beijing, was trained in China's very best teacher-training university to teach English. Her vocabulary was remarkably broad, her grasp of English grammar sound. We were dating when she began teaching at a nearby computer-oriented college nearby, but often told me she didn't realize how limited she was in her ability actually to converse with a native speaker of English because except for a few foreign teachers at her university, she had never had any interaction with foreigners who spoke English, other than in the classroom. It was fortuitous for her that I resided in the Beijing Friendship Hotel, where many foreigners were housed, including many English-speakers -- during our dating days then after we married, she got a *lot* of practice. And became a much better teacher for it. This was a gal who had started concentrating on English-language skills when she was about 12 years old.

All this touches on another issue: work visas. If we could see our way clear to offer more visas for non-Americans to go there to work in areas short of qualified personnel, the foreign workers would be under direct supervision, spending their money in America (leaving aside that many of the products we buy are from outside the U.S.), and through sheer exposure develop a sense of U.S. culture and skills in English far more quickly than they could "back home." I recall a few years ago when Congress defeated a proposal to allow more IT professionals in; a number of movers and shakers in that field complained bitterly that U.S. universities simply don't (or weren't then, anyway) produce enough graduates in the required disciplines for the companies' employment needs to be anywhere near met. So they started outsourcing? I don't remember the numbers, but it seems for every one American graduate the companies, industry-wide, needed 2 to 3.

Finally, in the case of public companies, they have to consider expenses, if they're going to stay in their shareholders good graces. (I like to think the Enrons are the exception, not the rule.)

It is a troubling dilemma, as I imagine we just about all agree.

Mekhong Kurt, Web Master

[Peter2001]

It is indeed a touching issue and one can speak for and against it. But we should accept the fact that with the emergence of IT we are passing through a rebirth process. These are inevitable global changes and are seen at all level and outsourcing is one of them. Though it affects US economy and employment upto a extent, but US economy is so vibrant and strong and is definitely capable enough to absorb these effects.

If we explore, we will find two types of cases wherein some company outside USA who undertook outsourcing projects have produced colorful results whereas some of them failed. And unless we have the ratio of good vs poor performers we will hardly be able to reach the conclusion.

It is always good to exchange ideas and thoughts but we have to consider the fact at a broader level.

I am telling it because I have heard about a Washington based company which has been outsorcing its work since more than a decade upto 100% satisfaction. Since I have this example in my mind I would think a bit differently.

Peter

[metavisia]

Hi,

I'm CEO of a web design & development company, based in Bulgaria. We do outsourcing although it's not our primary business. We find client ourselves and work with them as an independent party. However, there is one Dannish and one US company who outsource to us their projects.

As you can imagine, the main problem is finding jobs. I know there are so many people interested in outsourcing, but finding actual partners is hard task. I'm even thinking of posting such topic here, I think people might get interested.

Ok, my opinion, as a non-american, is that outsourcing is good. For the buyers (i.e. companies from USA and EU mostly) it's cutting of costs, recruiting highly motivated staff. Quite often it also means high quality and innovations. Which, enables entrepreneurs with low budget to complete in Internet market as well. You would agree, no one with a budget like $10,000 can do quite big business working with US development team. That money is enough for 2 avg. monthly salaries, while with the same money you can hire an entire team for an entire year offshore. Management is not too hard too - for example, I'm managing the staff, so the outsourc-er is not worrying about anything but getting sales.
Of course, not all companies are like us, and buyers may come on low-quality pseudo-developers. But I'm sure the same could happen in US too.
Alright, what is good for us, the outsourc-ees, is we find good-paid job and experience in a high-tech market. The bad for us is that if we lose the partner for some reason, we must start from ground zero, while the outsourc-er can find another company and lose no client (since the clients don't know who's the actual developer, they only know the person they contact).

In general, for countries like ours (Bulgaria), outsourcing is an opportunity of getting higher salaries. For example, some developers here get salaries as high as $800 per month, while most people work at $200 or less. So, we can't talk of a heartless exploitation here. It's a gold mine.

Of course, for US and the EU countries that has two sides - the business owners lower expenses quite a lot, which is good. At the same time, the developers lose their jobs or are forced to work for ridiculous money.

But that's life. Wasn't the idea of making Internet a GLOBAL network? It's not a US-only network, it's global. So, the pros and cons should be suffered. Of course, developers who had lost jobs for that will hate for these words of mine, I'm sure.
Anyway, Internet is globalizing. By the way, Bulgaria starts suffering the globalization as well - $200 here is a too low salary, no one in IT will work for that money, while you can find dozen million happy Indian, Pakistanian and Vietnamese developers kissing your feet for that money. Even here, in Bulgaria, we suffer of disloyal competition of home-based "companies" paying no taxes, securities, having no offices, etc.
Of course, wise businessmen find the golden mean and find low-cost and in the same time reliable service. I'm sure for an american is not so important to get a $5 per hour employee rather than $15/hour. Which makes sense is to get reliability, costs are saved anyway. Of course, some don't think that way.

My conclusion? Outsourcing is a reality. For good, of for bad. How to accomodate, that's the key.

By the way, in global scope what outsourcing does is quite good for America. My point is - in India, Pakistan, Russia, Romania, Bulgaria, Ukraine, all over the world - nations who never knew where North America is, now speak good (relatively) English, use English-language software, know who is Bush, who is Kerry, where is New Jersey and that Washington is different than Washington DC. We think in US dollars, speak in English. Culturally, economically,
USA is forcing its position as a #1 country in the world. Because it deserves it. Next American generations will evaluate that, I'm sure.