Glad to hear it. If I told you the actual details of these disasters, you would not believe it...plus it would take a lot of time.
The truth is they don't have a clue on how to manage intellectual labor. They try to do it as it were an assembly line. Doesn't work. Offsourcing Hi-tech means managing intellectual labor accross great geographical, cultural, and sometimes linguistic divides. Not what I would call a recipie for success.
The local engineering team I work with includes folks from the U.S., China, India, and Malasia. It is a superb team -- one of the best eng. teams I have ever worked with. But...we all work in the same place. It's very easy to meet, to communicate, to resolve issues, to meet by the watercooler and explore the issues we were too shy or too hurried to bring up in meetings, to help each other, etc. You cannot do this long distance; you just can't.
It's true that paying these people bay area wages is more expensive for the company. On the other hand, every product we're put out has been on time and its quality has surpassed or equalled industry leaders. How do you price a customer knowing and telling others that your product is "great."? How do you price the amount of money/time spent to re-do a project three or four times and then deciding you're going to scrap it and start over? This happens a lot with offsourced work.
It looks good in the short run, because in the short run the company is still running on its non-offshored reputation. In the long run many companies might still offshore because upper management don't give a shit. I mean sure, they might be destroying the company, but they will walk away with their guaranteed millions, so why should they care.
The "efficacy" of the capitalist model is more myth than fact.
Joanna
Doug Henwood wrote:
joanna bujes wrote:
More interesting is the thesis that outsourcing is profitable for hi-tech companies. I wonder how they figure out that profit. The very large hi tech company I work for has outsourced a number of projects to India and China. I know first hand that the results of this off-shoring were nothing short of disastrous. Because of communication problems and inept management, the work done offshore had to be done over, about three times so far. This not only cost more time-wise and money-wise, but in the meantime, my company shipped products that looked like they were done in somebody's garage (while charging "enterprise" prices) and, I suspect, considerably tarnished their reputation and credibility.
This line is now emerging in the biz press. I saw something from one of the brand-name consultants the other day saying that 2004 will be the year of "reality-check" or some such for the whole trend. The savings turn out to be far smaller than the raw wage gap makes them appear.
Doug
