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October 15, 2005 7:26 AM PDT
Indian outsourcers follow a megatrend
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If your job can be done over a wire, your career is at risk, says the CEO of Infosys, India's second-largest outsourcer.
The New York Times
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Ofcourse as you said...India has not seen the actual effect yet..
Ofcourse as you said...India has not seen the actual effect yet..
China is defintely improving but it has long way to go in software outsourcing.
Indian's so-called English is only a dialect spoken in India --and among Indians abroad. It's not the English that is spoken in the business world.
Any criticism on the Chinese by Indians is null, as far as I'm concerned.
China is defintely improving but it has long way to go in software outsourcing.
Indian's so-called English is only a dialect spoken in India --and among Indians abroad. It's not the English that is spoken in the business world.
Any criticism on the Chinese by Indians is null, as far as I'm concerned.
What people dont realize is the hidden cost of outsourcing in term of quality, which leads to the "speed" problem that you mentioned. I am sure this cost will be reduced as outsourcing companies such as Infosys gain more experience along the way as has been proven. In the mean time, they continue to attract attention on low bids.
I think his comments are just simply frank and reflect his frustration of constant negative publicity on outsourcing in the US. I feel the same frustration from the Chinese who are also excused of dumping cheap products on the market.
This is a challenge that US companies will face in
decades to come in the global economy. It is up to us to overcome it through business and technology innovations.
BTW, I am neither Indian nor Chinese and also affected by the outsourcing trend in some ways.
Well, I have to agree. While some folks (mostly the Indians themselves) point out that education in India is much more rigorous than here in the US, at best, it stresses more learning by rote, more achievement through duplication and emulation, than the ability to problem solve, adapt and fix.
So, for those jobs where you need low production costs, true grunt code development, etc., going offshore may not be a problem. But true innovation and, therefore, wealth creation, will remain in the US.
What people dont realize is the hidden cost of outsourcing in term of quality, which leads to the "speed" problem that you mentioned. I am sure this cost will be reduced as outsourcing companies such as Infosys gain more experience along the way as has been proven. In the mean time, they continue to attract attention on low bids.
I think his comments are just simply frank and reflect his frustration of constant negative publicity on outsourcing in the US. I feel the same frustration from the Chinese who are also excused of dumping cheap products on the market.
This is a challenge that US companies will face in
decades to come in the global economy. It is up to us to overcome it through business and technology innovations.
BTW, I am neither Indian nor Chinese and also affected by the outsourcing trend in some ways.
Well, I have to agree. While some folks (mostly the Indians themselves) point out that education in India is much more rigorous than here in the US, at best, it stresses more learning by rote, more achievement through duplication and emulation, than the ability to problem solve, adapt and fix.
So, for those jobs where you need low production costs, true grunt code development, etc., going offshore may not be a problem. But true innovation and, therefore, wealth creation, will remain in the US.
for outsources, if you can't find people who can communicate
effectively with your customers, you'll be going dead in the
water. And that seems to be the basic problem with outsourcing
to any off shore site. The offshore personnel speak a form of
English, but they do not speak American, they do not
understand the American culture or customs, and they usually
have very little idea of what an American customer is saying over
the phone or in an email. The offshore personnel try hard, but
they just keep missing the critical points when trying to
communicate.
So, outsourcing is definitely cheap, and the outsourcing
companies get exactly what they are paying for.... cheap
customer service.... and they also get unhappy customers in the
bargain.
America is a dead country. Our traitorous leaders have outsourced our standard of living. The "American" stock market prices are determined more by what happens overseas than by what happens here in the US. Watch the interest rates go up, watch the housing market crash, watch the stores go out of business after this Christmas bust. In America you either have a high IQ and can serve the super rich in the medical field or you have an average IQ and are serving the rich in a low wage customer service job with crappy medical coverage.
It's the "Third World American Economy". Half your wages go towards energy, 30% goes toward health costs, and 20% goes toward everything else, and there's nothing left for economy lifting spending. When the FED raised interest rates in 1997 to "control wages" they put us back ten years. With the Bush support of CAFTA it will put us back another ten years.
Voting won't help. The Democrats support the same policies that got us here. Too much naturalization, too much outsourcing, not enough good government. If the private sector doesn't want to build refineries then the government should! Tax cuts for the rich have to stop. We need a third party, one that cares about Americans.
for outsources, if you can't find people who can communicate
effectively with your customers, you'll be going dead in the
water. And that seems to be the basic problem with outsourcing
to any off shore site. The offshore personnel speak a form of
English, but they do not speak American, they do not
understand the American culture or customs, and they usually
have very little idea of what an American customer is saying over
the phone or in an email. The offshore personnel try hard, but
they just keep missing the critical points when trying to
communicate.
So, outsourcing is definitely cheap, and the outsourcing
companies get exactly what they are paying for.... cheap
customer service.... and they also get unhappy customers in the
bargain.
America is a dead country. Our traitorous leaders have outsourced our standard of living. The "American" stock market prices are determined more by what happens overseas than by what happens here in the US. Watch the interest rates go up, watch the housing market crash, watch the stores go out of business after this Christmas bust. In America you either have a high IQ and can serve the super rich in the medical field or you have an average IQ and are serving the rich in a low wage customer service job with crappy medical coverage.
It's the "Third World American Economy". Half your wages go towards energy, 30% goes toward health costs, and 20% goes toward everything else, and there's nothing left for economy lifting spending. When the FED raised interest rates in 1997 to "control wages" they put us back ten years. With the Bush support of CAFTA it will put us back another ten years.
Voting won't help. The Democrats support the same policies that got us here. Too much naturalization, too much outsourcing, not enough good government. If the private sector doesn't want to build refineries then the government should! Tax cuts for the rich have to stop. We need a third party, one that cares about Americans.
1. Costs go up for American company.
2. Company outsources to India
3. Job losses of American force drive down demand for American company goods
4. Company needs to cut costs even more and rise prices
5. Indian jobs are outsourced to China, BTW no one in either country can afford the goods of the company either.
6. Company eventually goes bankrupt because no one is left to buy their products.
7. Repeat all above.
In the end, the Americans and Indians lose but there are a lot of "outsourcing" consultants laughing all the way to the bank!
1. Costs go up for American company.
2. Company outsources to India
3. Job losses of American force drive down demand for American company goods
4. Company needs to cut costs even more and rise prices
5. Indian jobs are outsourced to China, BTW no one in either country can afford the goods of the company either.
6. Company eventually goes bankrupt because no one is left to buy their products.
7. Repeat all above.
In the end, the Americans and Indians lose but there are a lot of "outsourcing" consultants laughing all the way to the bank!
At national level, we should have foreseen such things to come and prepare to deal with it to the best benefits of our society. For example, when the Japanese won over the automobile market in the 80s due to their more energy-efficient cars, the US auto companies did not do anything until their bottom line is threaten. Since then, they are just playing catchup. This is due to lack of vision on the part of business leaders. Yet, when business is down, the workers are the ones who pay for it.
There are efforts by some companies to develop competitive near-shore outsourcing companies. With a few hundred bucks more, we can have true Americans, who can serve the needs of our economy to save cost. Yet, they come across on the news only once or twice, while the publicity on India outsourcing are all over the place, both positive and negative such as this one. I like to suggest US-based outsourcing companies in the mid-west as an alternative here, but I can hardly recall who they are.
These companies should receive more publicity and support for their contribution in keeping jobs in the US.
Most of them dined at fine restaurants, flew airlines paying full fare (at the company's cost) and rented every car in the rental lot. Companies in the US failed to keep the costs down. By 2001, these rates came down due to lack of demand (dot com crash) and cost cutting by companies that could not afford to spend $250/hr + expenses.
Lesson here being, if you do not focus on efficiency, somebody else will and most companies and individuals are looking for reasonably priced products that have near acceptable quality. Guess why Rolls Royce is not the top selling car in spite of being known for top quality and nameplate. As more companies go in this direction, more outsourcing is going to happen.
As long as American consulting companies can put a lid on costs, become more efficient, outsourcing can be slowed down a little bit but resistance is futile. I know someday somebody in Bombay will take my job too, can't do anything about it.
At national level, we should have foreseen such things to come and prepare to deal with it to the best benefits of our society. For example, when the Japanese won over the automobile market in the 80s due to their more energy-efficient cars, the US auto companies did not do anything until their bottom line is threaten. Since then, they are just playing catchup. This is due to lack of vision on the part of business leaders. Yet, when business is down, the workers are the ones who pay for it.
There are efforts by some companies to develop competitive near-shore outsourcing companies. With a few hundred bucks more, we can have true Americans, who can serve the needs of our economy to save cost. Yet, they come across on the news only once or twice, while the publicity on India outsourcing are all over the place, both positive and negative such as this one. I like to suggest US-based outsourcing companies in the mid-west as an alternative here, but I can hardly recall who they are.
These companies should receive more publicity and support for their contribution in keeping jobs in the US.
Most of them dined at fine restaurants, flew airlines paying full fare (at the company's cost) and rented every car in the rental lot. Companies in the US failed to keep the costs down. By 2001, these rates came down due to lack of demand (dot com crash) and cost cutting by companies that could not afford to spend $250/hr + expenses.
Lesson here being, if you do not focus on efficiency, somebody else will and most companies and individuals are looking for reasonably priced products that have near acceptable quality. Guess why Rolls Royce is not the top selling car in spite of being known for top quality and nameplate. As more companies go in this direction, more outsourcing is going to happen.
As long as American consulting companies can put a lid on costs, become more efficient, outsourcing can be slowed down a little bit but resistance is futile. I know someday somebody in Bombay will take my job too, can't do anything about it.
The thing that most bothers me is not that the software development work that is going overseas. It is more the fact that it is moving work that requires great skill and education into sweatshop territory.
Let's pretend Indian companies were more capable of meeting the needs of their client while paying their labor force close to what would be considered competitive US wages. I would not be so bitter about American company deciding to contract with them because of their unique skills or "business model".
Instead, it seems the real "disruptive business model" of the Indian outsourcers is selling is the ability for their clients sidestep paying fair wages to people doing certian types of work for them.
Lots of IT projects Indian companies work on do turn out very well at a much lower cost. Call centers are not known for good quality anyway. This tide can't be reversed. Another way to look at it is that India and China have almost half the world's population and they are taking education/technology/infrastructure seriously. They will try to earn their right place in the world economy sooner or later and while that is happening, it is going to hurt the developed world.
The thing that most bothers me is not that the software development work that is going overseas. It is more the fact that it is moving work that requires great skill and education into sweatshop territory.
Let's pretend Indian companies were more capable of meeting the needs of their client while paying their labor force close to what would be considered competitive US wages. I would not be so bitter about American company deciding to contract with them because of their unique skills or "business model".
Instead, it seems the real "disruptive business model" of the Indian outsourcers is selling is the ability for their clients sidestep paying fair wages to people doing certian types of work for them.
Lots of IT projects Indian companies work on do turn out very well at a much lower cost. Call centers are not known for good quality anyway. This tide can't be reversed. Another way to look at it is that India and China have almost half the world's population and they are taking education/technology/infrastructure seriously. They will try to earn their right place in the world economy sooner or later and while that is happening, it is going to hurt the developed world.
I used to work for a fortune 100 company. I watched my American friends going up the corporate ladder while I was going through the H1B Sh**. I respect American friends and they respect me. The company I used to work for started outsourcing about 5 years back. I used to work day and night (Indian time) to get the Indian team come upto speed. I saw the way the quality improved. I saw the way their role changed. Of late instead of working with us on projects, the Indian team started getting complete projects done in India. it is not 30/70, it is 100%. Naturally, my manager (another Indian btw) asked me to transfer my projects to the Indian team and laid me off.
Now, the point here is that the outsourcing has come a long way in the last five years. Companies are finding it comfirtable to outsourcing. For every Dell (bad) experience, there are hundreds of Microsoft (good) (Bill G, Larry E. are crazy about Indian dev centers) experience. Nilakeni is right in saying that it is better to accept the fact and move on.
Looking at the rate of change in Indian cities, I agree with Nilakeni that India and China will be the center of the world again.
True, Nilakeni comes across as very brash and arrogant person. With the kind of success he is having, I can hardly complain. Believe me, any American CEO would have been more egoistic, with half the success of Infosys.
I used to work for a fortune 100 company. I watched my American friends going up the corporate ladder while I was going through the H1B Sh**. I respect American friends and they respect me. The company I used to work for started outsourcing about 5 years back. I used to work day and night (Indian time) to get the Indian team come upto speed. I saw the way the quality improved. I saw the way their role changed. Of late instead of working with us on projects, the Indian team started getting complete projects done in India. it is not 30/70, it is 100%. Naturally, my manager (another Indian btw) asked me to transfer my projects to the Indian team and laid me off.
Now, the point here is that the outsourcing has come a long way in the last five years. Companies are finding it comfirtable to outsourcing. For every Dell (bad) experience, there are hundreds of Microsoft (good) (Bill G, Larry E. are crazy about Indian dev centers) experience. Nilakeni is right in saying that it is better to accept the fact and move on.
Looking at the rate of change in Indian cities, I agree with Nilakeni that India and China will be the center of the world again.
True, Nilakeni comes across as very brash and arrogant person. With the kind of success he is having, I can hardly complain. Believe me, any American CEO would have been more egoistic, with half the success of Infosys.
I am amazed at how everyone in the forum is bringing this down to racism,arrogance etc. Being indian, i live in america, and i have respect for all, let it be american,chinese. I think the CEO's to fill their pockets will pretty much decide what to outsource. Its all part of business cycle, and all we can do is share the pain of people, if any job is lost in either side of the world and, hope he or she gets something fast. Life moves on guys.