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More on outsourcing

Jodi, a.k.a. Guinevere, recently posted this comment in regards to my off-shoring stories post. I didn’t want it buried in the comments, so here it is:

For many years I worked for a cbt/wbt company. My skills ranged from an artist and art director to project manager.   About a year and a half before I quit and began contracting on my own, I worked on several projects that we were outsourced to India. Recently, I have been contracted to be a state side art director on a project where production is completed by another off-shore company located in India.

The most amazing part of using off-shore companies is the price. A friend of mine recently did some pricing for an off-shore project:

LMS - $200/day
artist/flash developer - $15/hr
programmers/developer - $20/hr
Instructional Designers -$20/hr

Their employees probably make one third of that, which is sad, but in their country it's a great salary where they can actually feed their family and afford a stove to cook it on.

Years ago when we first started working with off-shore production companies they were not a very large threat. We had to set up everything making it "idiot proof" so all they had to do was to plug in graphics, content or whatever. Recently, I've noticed that several years later, nothing has changed. They do not want to think for themselves, not even slightly; and if you don't tell them exactly what to it, it just might not get done. A developer friend of mine described it perfectly by stating, "If you tell them to build a blue house, but don't them the exact dimensions or where, they don't build it. Next time you meet with them, you ask "Hey, where's the blue house?' and they reply, 'you did not tell us where to put it, or how big, so we did not build it."

American companies are used to people doing some kinds of thinking for themselves. Often, there is not enough detail in the info we are supplying them to get the job completed as planned. Their solution is always to throw more people on the job. They do meet their deadlines, but with a lot of anxiety and stress from the American team.

They have a lot of very talented Developers, but the element of not having the ability to think for themselves, is a real problem. Most companies look to their developers for solutions to problems. They say, "We need this, and that" and the developer says, "then I recommend doing it this way, or that way." Well, the offshore companies often say, "How do you want us to do that?" Can you see the problem there?

I have known a few great foreign (from India specifically) developers that live and work in the states and they are excellent and free thinking, so it makes me wonder if it's not just a cultural thing, but a hierarchy issue; where they have been programmed to ask before thinking, as to not step on someone's toes. Upon working in America they quickly learn that things are different here.

I don't like off-shore outsourcing; some companies are calling it 'Global Resources'! The company I used to work for has laid off 40% of its production team. I believe every one of them has found work elsewhere, but many are not as happy, doing less than their qualifications and making less money.   I will never believe that off-shore rescoring is good for the American economy, like I've read in several places. I will never believe that it's the perfect solution that corporations are trying to make believe.


Posted Fri, Jun 4 2004 11:06 AM by Darrell Norton

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Comments

Eric Wise wrote re: More on outsourcing
on Fri, Jun 4 2004 7:29 AM
The problem you run into combatting off-shoring is that even if the
foreign worker doesn't think for themself and does something wrong, you
can make them redo it 3 times before the hourly rate matches that of an
american. =(

Of course as more money gets distributed to foreign markets they should
experience inflation, their salaries will go up, ours will go down, and
eventually that advantage will disappear.

Just have to worry about some other up and coming country taking their
place.

Ah the pains of the global marketplace... Americans don't own the right
to be wealthy... but at the same time we should do a better job of
protecting our employees.
Darrell wrote re: More on outsourcing
on Fri, Jun 4 2004 8:31 AM
I think industry is taking unfair advantage of offshoring, but it is in response to the rather depressing rate of project success. Better software engineering practices *here* would lead to less offshoring, period.
Rama Krishnan wrote re: More on outsourcing
on Fri, Jun 11 2004 2:52 AM
Im afraid i find many of the comments that you posted as being extremely condesending.

the prices quoted for those deigners e.g. $20/hour are close to the rates offered for a junior developer.

however, your subsequent comment, shows a gross sense of pity and ignorance on your part.

"Their employees probably make one third of that, which is sad, but in their country it's a great salary where they can actually feed their family and afford a stove to cook it on."

The IT industry in India is not some sweat shop where kids are making Nike trainers, these are educated kids, who have been to college/university.

What you consider to be a derisory salary (e.g. $25/hour), equates to $4000 a month, even if they received one-tenth of that, it still equates Rs21,000 a month.

that is a heck load of money in India!

don't you get it? its the cost structure of the country, and the cost of living.. The West can't compete.

please dont be so condesending in your language, with your little concerns of the assurance that they will have enough money to feed their family and cook from their stove.

Darrell wrote re: More on outsourcing
on Fri, Jun 11 2004 4:03 AM
Rama - *I* was not being condescending. If you had read the post, you would see that this was written by someone else. Go ahead, read the very first sentence of this blog post.

Done? Ok, now you will see that I did not write this. Since you can't even take the time to read *properly*, your credibility goes right out the window.

Is this tone condescending? I'm thinking it is. That's because you try to flame me and say that the "West" can't compete when you can't even read?

Gimme a break.
Jodi wrote re: More on outsourcing
on Fri, Jun 11 2004 6:46 AM
The condescending sarcasm that comes from this post does not come from Darrell, it comes from Jodi, whom does not even know Darrell, or anyone associated with Darrell, and she has nothing to do with Darrell, other than this BLOG.

Rama, who's being condescending? You overlooked the fact that I said it's a great salary only to let me know it's a "heck load"?

I really did not mean to offend. I suppose the part where I said it was a great salary, was overshadowed by "and a stove to cook it on". Funny how you make it seem as though everyone in your country can afford a stove, when I know this not to be true. I don't think its right! I hope everyone all of the world can afford the simple luxuries that I know Americans take for granted. However, I hate to see American companies giving money to other countries only to fatten the wallet of corporate CEO's?

I'm so happy that IT people in India are making a terrific living! It's wonderful that the individuals with the same or better skills are getting overlooked because of price. Really, how great is it that people in America are taking jobs for less their value to keep from going homeless while Indian IT workers are living great? There, THAT was condescending sarcasm.

I think it's really easy to join the ranks and say "condescending Americans!" In all actuality we are all a little condescending when it comes to protecting our careers and livelihood.

The pricing I quoted is completely accurate and I make no apologies for that.
Rama Krishnan wrote re: More on outsourcing
on Mon, Jun 14 2004 7:46 AM
OK :) Darrel, i raise my hand, i was too quick to react to your posting. They weren't your comments. I apologise.

BTW, my comments about the "west can't compete", was a commentary on the cost structure and commoditisation of IT skills, not a reference to the ability/capability in the West.

Nevertheless, my other comments are still valid.
Darrell wrote re: More on outsourcing
on Mon, Jun 14 2004 7:56 AM
Rama - the US will have to react somehow to the increasing globalization of the world economy. This trend has put pressure on other industries and software development won't be the last.

I'm confident I can adapt, but not everyone is as adaptable or financially set like me. :)
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