Number-cruncher: “Say! We can get THREE Indian IT resources at the same salary as one of our American IT resources, AND we don’t have to pay them benefits!”
IT (technical) manager: “The American resources work much more efficiently, design better code, are always available outside of business hours, and they speak clear English.”
Number-cruncher: “But THREE instead of one?! AND we don’t have to pay them benefits? C’mon! Surely you could train them to perform at the same standards as the American worker. Where’s the downside?”
IT (technical) manager: “Historical and anecdotal evidence suggests otherwise, and American resources are here, face-to-face, and they’re easily managed versus a resource on the other side of the planet.”
Number-cruncher: “I’m sorry, but the big boss man is going to appreciate having a bigger bonus check more than he will with what you deem to be higher quality staff.”
IT (technical) manager: *sits back and folds his arms across his chest* “Well you surely know how to do my job better than me, so please, by all means, let’s go for it. When the systems are smoking heaps of garbage in eight to twelve months, don’t say I didn’t warn you.”
That's the discussion that was had at one of my former companies, almost verbatim. Were you listening in? :-)
Outsourcing, of course, was implemented, because the board wanted it. And, of course, it was a disaster. I got out before things got *really* bad, though. Strangely enough, I heard through the grapevine that they needed to bring in five (5!!) H1B's to take over my duties, and those five still couldn't do it.
I went through another IT outsourcing at a large Fortune 500 company. Basically, we changed employers and kept our desks. 85% of a 200-man IT dept (including me) quit within 6 months.
The end results were devastating for the company, the only way they survived was by throwing money (a billion +, if the rumor mill was right) at the problem until they were able to stabilize the situation. Everyone in management at the company who was involved in the outsourcing decision - from the COO down - wound up being fired over that one.
I've no idea why people do it. Arrogance, I suppose. "This has failed every other time, but only because *I* haven't tried it yet!".