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.
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!
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.
" E.g., if the American worker may cost 40 times more, but is 60 times more productive, then it's a bargain."
I deal with employees from several different countries who are part of a support team for an internal accounting/payroll system. The productivity issue you raised is caused by cultural differences in my opinion. The team members from nation A are really sharp but can't make a decision to save their lives. The team members from country B aren't very sharp but are cheap. They also will just walk off and leave everything hanging when their shift is over (the US team doesn't have shifts, we work until the problem is solved). The team members from country C don't like those from country B. The team members from country E tend to get hysterical and start shouting at the slightest difficulty.
It's really all starting to fall apart and the management just can't seem to grasp that fact.
This ain't no way to run a company.