Posted on 02/08/2005 1:38:06 PM PST by KwasiOwusu
Silicon Valley, Boston and Austin may have some new competition--and not just from Bangalore, Shanghai and Singapore.
The latest kids on the tech block are places like Twin Falls, Idaho; Oklahoma City; and Jonesboro, Ark. These are among the smaller cities or rural areas of the United States where information technology companies have been locating or expanding facilities.
The companies, ranging from IT services start-up Rural Sourcing to computer giant Dell, can save on wages in these communities, thanks partly to inexpensive housing there. And in some cases, the companies are pitching operations in midsize America as an alternative to shipping work abroad.
Tech companies are locating operations in smaller U.S. communities, such as Oklahoma City and Jonesboro, Ark., where wages can be much lower than in computer industry hubs like Silicon Valley.
Bottom line:
Facilities in midsize American cities may offer a low-cost domestic alternative to offshore outsourcing. And some involved in the "homeshoring" trend can imagine small cities eventually challenging San Jose and Boston when it comes to tech innovation.
A key to what's been dubbed "homeshoring" is tapping a little-noticed talent pool. Kathy White, Rural Sourcing's founder and an Arkansas native herself, argues that technology professionals in major metropolitan centers often come from smaller communities. "We're just reaching the ones that don't want to leave," she said.
(Excerpt) Read more at news.com.com ...
Why can't more American firms be like Rural Sourcing?
I think there are too many lazy CEO's out there, who basically just take the easy way out, and outsource jobs to India or wherever at the drop of a hat.
If some IT firms are making a profit moving the IT jobs to cheaper locations in the USA,why can't others?
I needed to get a new microwave.
I finally found two brands made in the US. I buy American when possible.
Now, if I can just find a toaster. Everyone I checked from highend to low, is China made.
Bring back the manufacturing, please.
What are those two brands, sharpe and who else.
I'll buy used before I buy anything not made here. Sometimes that's the only time you can find "made in USA". That's how bad this is.
Inexpensive housing is important. We have a labor problem in the Keys because there is little inexpensive family housing. Some of the people who live here, and I'm "kinda" one of them, don't care. I'd rather drive (or fly) to the mainland once a week or two, if I had to.
I'd move to the Keys in a NY minute if I could. :~) What kind of labor problems if you don't mind my asking....
What brands please
Many CEOs are simply idiots, who just follow the latest trend. The trand over the last few years was short-term cost cutting by off-shoring. I said at the time (and have repeatedly reiterated) that it was a stupid move, not because I was agreeing with the protectionist crowd, but because it didn't make business sense in the long run.
The cost savings of off-shoring, much of the time, is an illusion when compared to the costs of trying to manage things remotely, shipping/currency/taxation issues, and productivity. E.g., if the American worker may cost 40 times more, but is 60 times more productive, then it's a bargain. Maybe off-shoring makes economic sense for low-skill, labor-intensive manufactring jobs, but the CEO fad-of-the-year was to off-shore things that required high skill or could be improved eaiser by automation.
I have vast experience in managing suppliers. What I have found is that, although sourcing in Asia will reduce base materials costs of the items procurred, the costs of logistics, quality and overhead on the home front go up. Due to language barriers, corruption, theft of IP and a number of other issues, new costs show up that did not exist with domestic sourcing. Plus, one export control violation (reminder - export control applies to things like product specifications and schematics, test scripts and the like) can ruin your day. Etc. I think many firms have real idiots doing their cost modeling (or, liars doing it) who miss all the added intangible costs. More typically, the intangibles get peanut buttered in other areas, and are never specifically apportioned to the actual products that got offshored.
RE: The cost savings of off-shoring, much of the time, is an illusion when compared to the costs of trying to manage things remotely, shipping/currency/taxation issues, and productivity. E.g., if the American worker may cost 40 times more, but is 60 times more productive, then it's a bargain. Maybe off-shoring makes economic sense for low-skill, labor-intensive manufactring jobs, but the CEO fad-of-the-year was to off-shore things that required high skill or could be improved eaiser by automation.
Bing, bing, bing, bing! We have a winner! You are 100% correct!
If I had to live in Jonesboro, I'd shoot myself.
How much did you pay for the toaster? $15? Would you have been willing to pay $30 or $40 if it was made in the USA?
I doubt it.
I make a comfortable living and I have been known to pay a bit more for American when I can on items I don't replace often. Poor economics, yes, buying American and spitting in their faces, rocks.
That's been my observation of the business community over the past 28 years. Many of the business executives that follow these trends are just high paid lemmings. they are usually following some "expert" consultant's newest brainchild idea. The consultant collects a big wad of moolah and then goes to find the next high paid lemming looking for a new "cutting edge" idea to reduce costs.
By and large the majority of executives can't even see the long run. They can only focus on the next quarter or two's projected earnings and what that may do to their precious stock options. For many of them, 12 to 18 months is long term planning.
If you lived in Jonesboro, they'd probably do it for you.
An honest answer.
For what it's worth I always try but it really depends on the product. It seems these days American companies use overseas labor while overseas companies use American labor i.e. Nissan, Mercedes, Honda, etc.
Also, overall, I think the concept of manufacturing as a source of high paying jobs was going to always dwindle regardless of factories overseas. Technology changes alone have eliminated hundreds of thousands if not millions of workers from manufacturing.
Watch the Food network when they are showing how some food product is mass produced. All those machines used to be peeople. All kinds of economies of scale point to why people aren't used any longer.
I'm also biased in that I worked at Whirlpool in Ft. Smith, AR two summers during college and it was the most boring work I've ever done. I couldn't imagine doing that for years because I didn't educate myself enough not to have to.
What is the MTBF of the $15 toaster Vs. the $40 one? If you don't know the answer to this question, then you might be blowing a wad of money.
Yes. It is very hard to tell exactly who made what that you are buying. I make an effort sometimes, but I figure to much time spent trying to figure out if it is "made American" raises the invertment price ( my time ) too much to be cost effective.
If it wasn't for sounding ike a conspiracy head, I'd say it has all been orchestrated to blend us into that one world crap some keep preaching.
We will be in deep hockey when the farming crisis we are heading for in about 15-20 years hits with the small farmer/rancher being run out of business and corporation being bought overseas. Watch food price jump like oil.
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