U.S. Offshore Outsourcing Leads to Structural Changes and Big Impact

cio.com ^ | August 13, 2003 | Diane Morello

[mhking]

I'll support your tariffs only if you tie it into a bill which eliminates the myriad legislative barriers

Don't forget getting rid of the Americans with Disabilities act and it's myriad bat-guano provisions...

[Dominic Harr]

As a favor to me and every other FR IT guy.... can you put them down and submit them as a message?

Boy, that would take a novel.

I'll give you the current one we're battling now. We outsourced our Lotus Notes development to a group called 'Satiam' in India. They were given a project, writing a 'log tracking' app. Our folks estimated it would take our people 1500 hours, beginning to end. The indians estimated 2000 hours, so that's what we budgeted for.

The indian folks have now burned thru the entire budget, and have not yet had a design doc approved. They're asking for 1500 more hours to finish the 'requirements gathering'.

If you want this to end, get to a reporter somewhere and just have him look into the results from all this. I've not been able to find one single success story. As far as I can tell, it's a 100% failure rate.

Sure, the indians *fail* cheaper than we do, but is that really a good thing?

[Last Visible Dog]

Automations main goal is to eliminate tedious tasks in an effort to create more advanced products and services. The automation cycle gave us the dot-com boom. First came CGI then ASAPI/NSAPI, then JSP/ASP, then J2EE/.NET, now SOAP/WSDL/XML/XSL, and who knows what is next. The progression of technology has built wealth for corporations and IT personel alike.

I agree with everything you say except "automation cycle gave us the dot-com boom”. The dot-com boom was based on two factors: Y2K technology spending (misinterpreted as part of the dot-com miracle) and pure foo-foo dust investor ignorance/insanity.

[Lazamataz]

Okay, that's a good one. Can you detail your last outsource project besides that one? (I'll gather your words and put up a post after a few of these)

[Dominic Harr]

Believe me, I understand. I've managed to stay one step ahead of layoffs, but many, many of my friends have fallen in the past few years.

But this is all just a massive mistake by the Dilbert pointy-haried bosses.

These same folks told us:

• The internet bubble was real.

• The Y2K threat was real.

And now, they say the cost savings from outsourcing are real.

I largely blame the idiot media. All these reporters writing stories about outsourcing, and not one anywhere actually asks the question, "did it succeed?"

[rdb3]

Would you reject a tort reform bill that gave you 90% of what you wanted?

Of course not! And your response was the precise response that I wanted.

In the hack world of IT, you can attack a vulnerable system that allows buffer overruns. My list of things is like that attack. I wanted to throw so much at it that at least 50% of it hits home.

Then I'll gear up for my next attack.

I got a lotta livin' to do before I die, and I ain't got time to waste.

[Lazamataz]

Okay, let's talk turkey. I'll support your tariffs only if you tie it into a bill which eliminates the myriad legislative barriers that unjustly inflate the cost of entering a business market, the outrageous levels of taxation on business which come directly out of the pocket of the consumer, the elimination of all work related visas, lethal fines for employers of illegal immigrants, the elimination of the minimum wage, the abolishment of OSHA and all unelected regulatory agencies, tax incentives to the States which enact measures which makes said State business friendly, and tort reform. As far as the tariff, let it be placed on goods which come from countries which have tariffs on our goods and no one else.

I'd love to implement this. But, as harpseal said, politics is the art of the possible. It has taken decades to get us here; it will take decades to roll back these items, with the CommieLibs screaming bloody murder each step of the way.

In the meantime -- TODAY -- we are losing jobs. However, after hearing some of Dominic Harr's stuff, we might be better off than we presume.

[rdb3]

Don't forget getting rid of the Americans with Disabilities act and it's myriad bat-guano provisions...

Say it, suh! Preach on.

I got a lotta livin' to do before I die, and I ain't got time to waste.

[MatthewViti]

That all = massive credit card debt

[harpseal]

The Y2K threat was real.

By this I presume you are not alleging that there would have been no problems whatsover had remdiation not been done on the dates that were is six digit format. I did not say bites because I have seen dates stored in packed format.

[rdb3]

I'd love to implement this. But, as harpseal said, politics is the art of the possible. It has taken decades to get us here; it will take decades to roll back these items, with the CommieLibs screaming bloody murder each step of the way.

See #306, then get back to me.

I got a lotta livin' to do before I die, and I ain't got time to waste.

[Dominic Harr]

I have a meeting in 10 mins, and I'm busy the rest of the day.

I'll throw out one other quickie:

About 4 months ago, our director of QA noticed that the data in her Status Reports database had been changed by an Indian resource.

Upon asking questions, it turned out the Indian developer thought she was poking around in development and was randomly changing things, trying to get a feel for the system.

But, of course, she was actually in the production instance . . .

I'll holler at you later. I'd be interested in helping get this info to the press. When the truth comes out about this, there will be a very, very interesting few years, I think.

[harpseal]

In the meantime -- TODAY -- we are losing jobs. However, after hearing some of Dominic Harr's stuff, we might be better off than we presume.

That presumes the managers can figure it out that they are costing more by sending the stuff overseas. Managers having that much intellect has yet to be proven

[Dominic Harr]

I'm sorry, I should have been more specific.

I'm referring to the Y2k panic.

Certainly systems needed to be patched. But the world was never in danger of ending . . .

[Dominic Harr]

Managers having that much intellect has yet to be proven.

Yep, you live in the same world I do!

[Lazamataz]

Lets do some math:

Your folks estimated it would take our people 1500 hours, beginning to end. The indians estimated 2000 hours. They have now burned thru the entire budget, and have not yet had a design doc approved. They're asking for 1500 more hours to finish the 'requirements gathering'.

Your folks would have done it -- front to finish -- in 1500 hours at 75,000/annum or $36/hr, at a total of $54,086.

The Indians work cheaper, at 15,000/annum, or $7.21/hr. They have already asked for 3500, JUST ON REQUIREMENTS GATHERING. Call coding another 3000 and support/deployment/bug fixes another 3500. Thats 10000 at $7.21, or $72,100.

Let's see: Americans get it done at $54,086. Indians get it done at $72,100.

Oh, yes, we must select the Indians.

[MatthewViti]

In Orwell's Animal Farm, the animals who took control of the farm started off with a set of rules, and one of their Commandments was, "All animals are equal." Over time, however, the power-hungry pigs started behaving like their former oppressors and they eliminated all of the Commandments except for the one about equality, which they changed to "All animals are equal. But some animals are more equal than others." Also, If anyone questioned Napoleon, the lead pig on the farm, the sheep were sure to silence him with a tremendous bleating of "Four legs good, two legs bad!" The bleating would continue until all questions were forgotten or dissenters were too intimidated to raise them again. The Animal Farm problem with our current leadership is obvious.

[rdb3]

After all, this honorable man has said he will no "What ever it takes" to protect the USA from terror attacks.

If that's the case, wouldn't you want to protect the Southern and Northern borders?

I got a lotta livin' to do before I die, and I ain't got time to waste.

[gnarledmaw]

"...CIOs will need a cadre of seasoned IT professionals and eager recruits to "turbocharge" new ideas..."

Im too familiar with what this means. This is where "old" white guys are contracted to teach the young female minorities who were hired what they should have learned in school.

I saw the IT trainwreck coming and jumped. I wonder how many will ride it all the way and then complain.

[harpseal]

Your figures for the Indians do not factor in the same reliability of the original estimates in the new numbers. You are actually understaing the Indian outsourcing cost by an unknown number maybe an order of magnitude as they still have finished the requirements phase.