Outsourcing IT

[MBA UOP]

What does everyone think of IT and customer service functions going overseas? I help manage a call center for a software company and am having second thoughts about going into another industry because of this mega-trend. I know that it makes good business sense (to shareholders and upper manangement) but what functions of business will stay domestically? :unsure:

[YaSO]

I presume software architects will not have to worry about their jobs being outsourced to overseas for a while. It's mainly because shareholders and upper management will need to speak with these software architects/project managers directly(to BS for the most part) and for a while, video conference/video chat/online conference will not be something these shareholders and upper management will be learning to use. If and when video conference/video chat/online conference becomes as accessible as you see in sci fi movies and TV programs, then maybe IT management does not have to say with shareholders or upper management, but ... I don't see it happening any soon.

[philipwhiteold]

Anything that requires actual hands ons (DBAs, Networking, etc.) won't be outsourced. A lot of the current jobs that are outsourced might make a comeback. Part of the reason programming jobs went overseas is because companies were paying 6 figures salaries to kids with a MS cert right out of HS. Now programmers are becoming a dime a dozen here. Companies should be able to afford them because people are working for significantly less.

BTW places like the Dakotas and I think Iowa have several Call centers. Some place in the US cost less to live.

[philipwhiteold]

I just found out today I know someone who programs call center software. He said there aren't to many people in his field and he does quite well financially. Just thought it was interesting that you mentioned that.

[YaSO]

I just found out today I know someone who programs call center software. He said there aren't to many people in his field and he does quite well financially. Just thought it was interesting that you mentioned that.
CNBC had a special series on India last week. Did you watch that? Companies like GE and Oracle are outsourcing number of tasks to India, and one of them was call center. It was pretty interesting to see how they train people. A bunch of Indian people are learning how to speak like Californian, Midwesterner, Southerner, Brit, etc. I wonder where and who write call center software.

[philipwhiteold]

Yeah I saw that on NBC. The Indian speach teacher yelling "how much wood could a woodchuck chuck if a woodchuck could chuck wood".

I think things will level out though. Salaries will probably drop slightly over here and Indians will start to demand better pay for their services. People will have to get a bit more creative to compete.

Businesses have to realize that the cheapest option is not always the best option. A lot of businesses forget about their stakeholders. If a company is so quick to jump overseas to India, who says they won't close out shop in India when the next cheapest alternative comes arround.

There are a few Indians on the board. Hopefully they chime in on this topic since they see this from a different viewpoint.

[prashant318]

:huh:

Well i mm an Indian and currently work in a technology firm in India. And our Client is GE, the first company to start outsourcing of jobs to countries like India. To be honest, outsourcing is good for US companies as it saves lots of $$ for them. At the same time, the Indian technology workers are getting more jobs in the country and the pay has also started to rise.

Unless you bring ethical issues in to picture, outsourcing is a win-win story for the both the countries. But if you consider some social implications, the US middle class workers can no longer command the salaries they used to because their Indian counterparts will work for a fraction of that amount. Also the Indian workers are not aware of employee rights and are exploited by the Indian companies who make them work for long hours with minimal wages. In period of time though, even indian workers will start commanding higher salary and other benefits. Definitely, the standard of living amongst Indians will improve and US middle class may no longer be able to afford the luxurious lifestyle they have been enjoying.

Let me clarify one more thing here. I read in some other posts that high tech jobs like "Software Architects" might not move to offshore. I think it's a big mistake to think that. Perhaps they have not analyzed the benefits of offshore model. We already see companies like IBM, Microsoft coming up with their R&D centers in India. Also some top MNC's have started their development work in offshore centers in India. India has an advantage over other countries in that it has more number of intellectual capital than most of it's competitors. And they can also speak English may it be in British or American accent. So what will remain purely with US in future? Well their President George Bush i would say ! ;)

Cheers,
Prashant.

[philipwhiteold]

You are right about intellectual capital. I lived in Fargo North Dakota for six years and they have very high percentage of college graduates, wages are low, and the cost of living is low. Some businesses saw the opportunity. Microsoft Business solutions is headquatered there now.

In terms of overall US-India trade, win-win is a bit off. We win by getting cheaper labor and saving money but this is US money that we are saving. US businesses are not (as easily) able to sell products in India so we can't benefit by getting Indian money so more money ends up going into India than out of. This is why India wins slightly.