Outsourcing suddenly less popular

satyam

This news should help them with their recovery then. That's a relief.

Is it possible

that this reduction has something to do with the Satyam fiasco? Very likely, a lot of companies over here are wondering how many Satyams there are over there. The general perception that you get what you pay for might also have a tiny bit to do with it.

Everything is outsourced

Even a perm job is outsourcing to a company, offshoring is the problem because there different rules apply to taxation and to standard of living, because of protectionism at another level.

The depression is going to bring it home to companies. You have to be crazy to be looking for a job in today's economic downturn, it will just end up costing you money in transport and time. Instead more people will become active at a political level, and part of that huge number will be looking for companies that off shore at the time of economic collapse, and then probably publicising the fact, that will cause local consumption of that company's product to fall.

A modern depression is going to be very hard for a government or major company to remain under the radar, every move is going to be scrutinized, and hotly debated, that's really what government's and corps fear in a depression, them coming under the microscope.

Demonstrations have already hit the UK, Greece and France and they are only set to get larger.

Massive protectionism is the order of the day, and that will see economies becoming self sufficient. The longer it takes to put in economic defence policies, the harder a country will be hit and the longer it will take to recover. I am betting Labour go the opposite way, and just watch us spiral further down. It is time to get our own countries in order, every other country is going that way.

I for one

have never seen an outsourcing deal save money. Normally, it's other reasons / agendas that push them on through (e.g. senior managers saying 'it isn't "core business" to have IT people - as if it is "core business" to have executives...)

AC because my core business is working, not posting comments.

i was recently involved in a quote

we quoted £80,000 to develop a piece of software, but we couldn't meet the delivery date unless we dropped all of our other projects. it's an internal company it department, so that was a possibility

the outsourcing company that we work with quoted 4 times that, and where we'd had 2 developers and a tech lead down for the work, they had 2 project managers, 2 coordinators, 2 senior developers and 6 developers down, plus support from one of our developers and tech lead.

I have no idea how even the stupidest manager can still think it's cheaper to outsource than to hire the one extra person that would have allowed us to do it, it's not like we're short enough on work that we'd have to let them go again after the project. we set up the outsourcing contract ourselves as we have 17 man-years worth of work this year and 4 people to do it.

Comanies are starting to ask...

.....whether is better to hire a competent employee here or 3 marginal ones in India for the same price.

They do have competent guys in India, but they are paid Western salaries by Google and Microsoft.

Why offshoring

Our company recently started outsourcing and here are some of the reasons I could gather.

1. It's NOT cost. Our outsourcing firm "works in pairs so that if one leaves the knowledge is still there." That and taking at least twice as long pretty much negates the cost factor except for

2. Protection from non-pay based employee costs like unemployment, workman's comp, taxes, unions (rare in IT), and the big one, lawsuits. All those government induced programs to protect the employee are now working against them.

3. Kickbacks. This was uncovered in the Satyam collapse. It seemed common practice for Satyam to give execs kickbacks for using their services. I would find it hard to believe they are the only one.

4. Ineptitude. On the project management and planning level and on the development level. Hiring good techs is hard to do when you aren't a tech. Furthermore, you aren't gonna get a good, experienced technical person for $30k USD a year, no matter how many you interview. If you are gonna have crappy IT, might as well pay less for it.

5. The bottom line for the next few quarters. Yes folks, the quality, long term drive of the 90s has gone out the window. Since the .com boom and everyone going public, execs now have shareholders to deal with. Outsource your stuff. It will save you money now and it will be a few years (hopefully) before the quality in your product begins to show up. Since the bottom line looks good now, it makes you look good. When your product stops selling because it's now crap, blame something else.

"Demand" is the wrong word in this article

Tolerance is closer to the mark.

@ OmniCitadel

I think that it's time we realized that almost every western company, of any size, is managed (and that is no longer the appropriate term) by a bunch of incompetent f***s.

Maybe I'm slow, but I have only recently realized this. This makes politicians even worse as those stupid, greedy, bastards and bitches, don't get paid nearly as well as there business counterparts and so are, generally, of much lower quality.

No wonder none of them can see the big picture and that the Western (First World) is being run into the ground for the sake of political correctness, and a blindingly good case of greed.

Outing the outsourcers?

At least a few organisations have a policy of not outsourcing when redundancies or lay offs are afoot.

Woah !

>but India will retain its lead in the near future due to its many advantages, including language, talent and experience,

I cant and wont decry Indian talent but language ?? With all due respect to the people of India, one of the reasons I loathe using some of our tech help systems is because they dont understand me or I dont understand them ! I have seen experienced people spend more time on a job trying to muddle through rather than phone India. Yeah, great cost saving.