U.S. firm sweet on offshoring deals gone sour

A small U.S. software development company is growing fast in part by mopping up offshoring messes.

Chicago area-based Decision Design doubled its revenue last year to $5 million, with a chunk of the business stemming from clients unhappy with projects they sent overseas. Through a strategy that includes locating U.S. facilities outside of high-rent areas, Decision Design says that it is cost-competitive with offshore companies, offering workers familiar with U.S. business practices and culture.

The 20-person company on Monday announced new offices in Pleasanton, Calif., that should hold another 10 or more employees.

"The additional space should be adequate to meet our growth, much of which has been caused by the current offshoring backlash," Monty Davis, president of Decision Design, said in a statement. The company's Software Remediation for rescuing failing software development projects, as well as its Homeshoring Services for low-cost outsourcing alternatives to offshoring, he said, "have been booming."
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Dell stopped sending U.S. technical support calls for two of its corporate computer lines to a Bangalore, India, call center in 2003.

Decision Design knows first-hand about the potential pitfalls of shipping tasks to India. The company launched Indian operations in 2001 but closed them down two years later. "Our offshore experience wasn't what we anticipated," Davis said in a statement. "The quality of work was lower than required, which caused rework and actually created higher costs than if we had done the work here."

The botched experiment led the company to the notion of "homeshoring centers" in the United States that nonetheless offer low costs to customers. In part by locating offices on the fringe of Silicon Valley and Chicago, the company claims that it can deliver savings of 30 percent to 60 percent below typical onshore development costs.

Who knows, maybe the mad, feverish rush to outsource vast chunks of good IT jobs to India may just slow down somewhat in the coming years, with some more sensible CEO's locating IT jobs at cheaper locations in this country instead, after all the horror stories from off-shoring.
Hopefully.
Plus IT pay in India has risen so fast over the past 5 years that they could be pricing themselves right out of business.

Great news for Americans to use good ole American ingenuity to get those jobs back where they belong!

If I worked for a company that outsourced anything, and the work returned to these shores because the foreign solution turned out to be a pipe dream, I would extort every last dime from that company, and dump them in a New York second if something better came along.

Loyalty works two ways.

I heard recently and from a good source that outsourced jobs are quietly being moved back to the states and not necessarily into low rent districts as suggested in this article.
The source, who is a foreign born US citizen, cited the inability of Indians (etc) to really comprehend standard English/common idiom. Hence, failure to resolve the issues they were paid to resolve but success in ticking off the frustrated customers.
Apparently some big companies are stumbling onto what we've known all along.

Plus IT pay in India has risen so fast over the past 5 years that they could be pricing themselves right out of business.

That's the ultimate resolution of the problem. India will, slowly but surely, become another slightly cheaper place to do business in, like Japan. But their quality will increase too. They won't be competing soley on price forever. But that'll be OK, because their labor will no longer be so ridiculously cheaper than ours. It'll be a "fair" fight again.

5 posted on 02/08/2005 3:10:48 PM PST by jennyp (WHAT I'M READING NOW: Professional NT Services by Miller)

Here's my own experience. Pure offshoring sucks. Whereas, multishoring kicks butt. Multishoring means you disperse the operation, with the "usual suspects" being of course the USA, plus India, Israel and Ireland, with growth locations being the Philippines and Uganda. You can probably see the pattern - good English skills and the ability to work on stuff 24/7 using shared development and testing techniques.

6 posted on 02/08/2005 3:12:58 PM PST by GOP_1900AD (Stomping on "PC," destroying the Left, and smoking out faux "conservatives" - Take Back The GOP!)

7 posted on 02/08/2005 3:15:14 PM PST by Southack (Media Bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)

I hope Vonage is one of them... solving technical problems eventually upset myself and the techie. Not sure if it was a disrespectful thing because I am a woman or because he couldn't understand English.
I finally threw some Southernese at him. I laughed, he was probably cringing in anger. And no, I was not attempting to anger him.
As soon as another company offers VOIP in my area- see ya vonage.

8 posted on 02/08/2005 3:23:35 PM PST by momincombatboots (Those who are too smart to engage in politics are punished by being governed by those who are dumber)

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