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Joel on Outsourcing to Asia

I know we have all be talking about this topic for awhile. Has Joel written any articles on the issue? What is his opinion of outsourcing? I'd like to hear his take on the issue...

GenX'er
Tuesday, August 05, 2003

Well, he did comment on outsourcing in his blog "Joel on Software" about two months ago.  Joel believes that the U.S. economy is simply going through a normal business cycle.

I disagree with his opinion.  Among other factors technology has changed the traditional economic business model. 

American corporations might be spending money right now, but they don't seem to be spending a lot of their dollars here.  U.S. based companies are creating new jobs in foreign countries (and moving existing jobs) and those outsourced jobs won't be coming back.

This outsourcing trend appears to be an unstoppable force primarily because our politicians are the best money can buy.

One Programming Opinion
Tuesday, August 05, 2003

"This outsourcing trend appears to be an unstoppable force primarily because our politicians are the best money can buy. "

Must...resist..urge..to smack...people who expect politicans to protect their jobs because they can't grasp the basic concept of global competition.

Hello Reality?
Tuesday, August 05, 2003

This of course begs the question (yes, "begs the question" - sorry if that's too dorky for anyone) of whether global competition is in our best interest.  Doesn't seem to be in my best interest, so is it okay if I oppose it?  I left my "Free Market Virgin" card at home...

Grumpy Old-Timer
Tuesday, August 05, 2003

Does it really matter if it's not in your best interest? Does that somehow make a difference in how markets operate?

Cheap programmers are in the best interest of India and other countries. Yes, its at the expense of the American programmer, but...waaah.

See...there is this whole other world out there beyond the shores of the US. And they have their self interest at stake.

Oppose it all you want. But a better way to spend your time is trying to figure out how to *compete with it* rather than crying to your crooked politicans to save your overpriced job.

Hello Reality?
Tuesday, August 05, 2003

Hi Hello Reality?

I can't compete with someone earning $6,000 to $15,000 a year overseas.  In India that type of income might make someone a middle class wage earner, here in the U.S. it would be considered poverty level income. 

Congress could stop the offshore job development stampede if it had the will to do so.  It could also reform the temporary worker visa programs that ultimately are used to send more jobs overseas.

One Programmer's Opinion
Tuesday, August 05, 2003

I always find it fascinating when professionals shout to the sky and froth at the mouth when they and their colleagues are facing potential (or actual) layoffs with jobs moving overseas when there was hardly a peep from the same demographic when millions of blue-collar jobs were  dispensed with in the same way through the 80's, and still today.  The irony is so thick that most people can't see it.

Chas
Tuesday, August 05, 2003

Of course, "in your interest" applies. Companies are outsourcing partly to "enhance share holder value". Why should the interest of share holders necessarily take precedence over (err, the place of) the interest of employees?

Anyway, markets are not some natural force: they are are least managed or manipulated if not controlled.

(I'm not a communist but I play one on TV.)

njkayaker
Tuesday, August 05, 2003

Yes, there's a bit of irony.

Yet, the demise of blue collar jobs was assuaged by notion of those jobs being replaced by higher-paying "knowledge worker" jobs.

The general trend is to replace higher paying jobs with lower paying jobs.

This time around there is no indication of the "great" jobs all the displaced IT people will get.

njkayaker
Tuesday, August 05, 2003

"Companies are outsourcing partly to 'enhance share holder value'. Why should the interest of share holders necessarily take precedence over (err, the place of) the interest of employees?"

The employees (including management) WORK FOR the shareholders, is why.

Jim Rankin
Tuesday, August 05, 2003


How would the Congress do this? How do you know where the software was actually developed? Putting tariffs and whatnot on hard goods is easy. They have to physically come into the country.

How do you do this with software? Do you want yet another army of bureacrats that run around private companies and audit and check where each line of code originated from?

Oh yes, by all means, lets get more government involvement with the software industry. We all know what an efficient lot they are.

Do you like the relatively inexpensive price you pay for your pair of khaki Dockers? They are priced that way because they are made by virtual slave labor overseas. Are you willing to pay two, three maybe four times that amount for the same pair just so America can get the textile industry back? Yeah, I didn't think so.

Hello Reality?
Tuesday, August 05, 2003

Chas -

How many people in this industry today were working in this industry in the 1980's? Twenty years is enough time to go from fresh college grad to "obsolete at 40" per another thread.

Devil's Advocate
Tuesday, August 05, 2003

Hello Reality?

You seem to have a lot insight into what the problems are and how other people don't know what they are talking about.

How about some solutions for a change??????????

Some helpful insight?

GenX'er
Tuesday, August 05, 2003

Reality does have a solution. He's learning his Cantonese and Mandarin as we speak, because at the rate we're going, in 2050, all the engineering jobs will go the way of the textile industry.

Jay
Tuesday, August 05, 2003

Solutions? I got solutions.

Some of you need to first start with improving your reading comprehension skills.

I clearly stated earlier that rather than *moan, bitch and cry* you make yourself more competitive.

Here, I'll say that again for the A-D-D crowd here:

rather than *moan, bitch and cry* you make yourself more competitive.

Get that?

Oh..And you make have to accept the fact that you just aren't going to keep making $80-100K a year for doing basic software development.  So here are some more tips:

1. Cut your expenses. Sell that expensive house and that stupid Lexus SUV you drive. Your neighbors still don't think your cool.

2. Learn that the US != planet. There is an entire planet out there full of people itching for your job.

3. Work. Work. Work. Read. Read. Read. Improve yourself instead of sitting at JOS and bitching about losing your job. No wonder so many of you are unemployed.

Hello Reality?
Tuesday, August 05, 2003

During the dotcom boom, everyone and their sister learned VBScript or HTML and became a "webmaster" and there were still unfilled positions.

When the dotcoms exploded, there were bodies everywhere. Most of those who came to IT for the easy money should be gone or on their way out.

If 10-15% of the IT jobs are sent overseas but 25-50% of the US IT workforce moves on to something else, doesn't that portend well for the rest of us?

IMHO one thing we can all do is stress quality software development and what a professional developer is like. Not "process uber alles" but simply good technique and delivering bug-free software that does the job.

We don't care where the software is built, so long as it's well documented and serviceable.

Bottom line - work your ass off to get the bottom feeding script kiddies out of the profession and there will be enough work for all of us.

Philo

Philo
Tuesday, August 05, 2003

See, even the lawyer figured it out.

(But probably only because he graduated from the Naval Academy.)

:')

Hello Reality?
Tuesday, August 05, 2003

You know, Reality, there are plenty of people who are well aware of the outside world, but still have concerns about outsourcing. Tone down your ego for five seconds.

Second, I tend to agree with Reality that political solutions are bound to fail. We'll only end up witha moribund economy and everyone trying to force businesses to hire constantly.

Globalization will run its course soon enough. Mexico is already being undercut by cheaper producing nations, but there aren't an infinite number of 3rd World nations to shift jobs to. Eventually, Indian programmers will earn 30-40k/year, and then they'll stop being quite so competative. It'll take a few years, and there will probably be some hardships, but in the end, I do believe everyone will be richer for it.

jason

JasonB
Tuesday, August 05, 2003

I agree with Reality, although perhaps not as aggressively ;-}

Differentiation is key. We need to figure out ways to further enhance the advantages we do have - like closeness to the customer for instance and our 40 years of experience.

I don't really believe in the value of predictions, 100 people make them, 1 is right and everyone forgets all the experts that got it wrong and celebrate the visionary. Anyway, I digress(!) although I don't know what's going to happen I'm confident in the entrepreneurial nature of the western world and our ability to deal with this threat and come out stronger.

Yep they'll be job losses - but from a macro perspective i've always believed they're important anyway - but if, as many believe on this board, the costs savings aren't real then business will come flying back and outsourcing will become more of a niche offering.

Yanwoo
Tuesday, August 05, 2003

And losers in this global competition can always be recycled into hamburgers :-)

Frederic Faure
Tuesday, August 05, 2003

I agree with JasonB.

I think, Reality, that everyone is quite aware that there is a world out there outside the US.  Many have even been there, some more than once.  And, yes, many of us work quite hard to constantly improve our skills.

My point is that globalization is not inevitable.  Countries have self-interests which, from time to time, conflict with globalization.  Over the long run, countries tend to act in their self-interest.

It's naive to assume that all countries will embrace globalization in a blind rush for the lowest wage.  Do they have a choice?  Sure: diplomacy, trade pacts, war, etc.  But most likely, if globalization doesn't come to pass, it will be because something we can't even imagine will make it pointless.

Also, I suppose the reason the "blue-collar/white-collar" irony escapes me is that the whole point of going to college, getting degrees, applying yourself, using your brain, working hard, etc. is to *avoid* being subjected to economic dislocations (as much as that is possible).  How many assembly-line workers busted their ass in high school?  How many went to summer school *voluntarily* to take a class so that they could take Calculus that Fall?  I never felt sorry for them, because they didn't do what it takes to get ahead - so why should they be suprised when the ax falls?

Grumpy Old-Timer
Tuesday, August 05, 2003

"I think, Reality, that everyone is quite aware that there is a world out there outside the US."

I'm not so certain that they do. If they did, then they wouldn't be so aghast at the concept of foreign workers working cheaper than them.  I'm sorry, but from what I see, there are many, many naive American programmers who think that they just should keep earning six figures for the sole reason that they are American programmers. When faced with overseas competition they just cry and scream "That's not fair!!!" Well boo friggin' hoo.

Perhaps it isn't you, but there are plenty people out there that have that mindset, at least subconsciously.

Hello Reality?
Tuesday, August 05, 2003

Lets introduce a little reality to Reality.

Globalization is a myth.  Countries protect their markets on a daily basis.  How quickly we forget Steel Tariffs, Automotive quotas, farm subsidies, and the WTO.    Free markets are not free because fair markets only work in a legal/political framework so it is always -- _ALWAYS_ -- subject to political influence and control. 

So your solution is get used to competing in the global marketplace?  If you consider that nearly 90% of software in China is pirated, then Joel should just figure out how to compete there correct?  Then should China copy and  resell FogBugz for $10, around the world, that is Joel's issue to figure out. That FogCreek would be able to sell a copy of software without political/legal constructs is a complete lack of "reality."   

While it is fun to slam American programmers as just "getting what they deserve for being successful, arrogant, lazy, --place your adjective here --- is so simplistic as to be ridiculous.  It is an emotional argument against America, for its success.  It sounds more vindictive than competitive.

The loss of manufacturing in the 70-80s taught us that companies do not work in the best interest of countries, so countries need to act in their own best interest.  That somehow we must allow this to happen in technology because it happened to manufacturing,  shows we have learned nothing.  Why would we want to create countries with the lowest standard of living?  Why not force them to compete at a level they raises them, instead of lowering us?

MSHack
Tuesday, August 05, 2003

Glad to see Reality showing his true colors and immaturity... Instead of taking the high road, take the callow road and revert to non-sensical stereotypes and insults. If you're 12 or younger, sorry, as a kid, you don't know any better anyway.

Back in the early 90's, I thought this book by Ravi Batra had some great insights about the future truths and myths about globalization: The Great American Deception - What Politicians Won't Tell You About Our Economy and Your Future. (amazon link at http://www.amazon.com/exec/obidos/tg/detail/-/0471165565/qid=1060108534/sr=1-4/ref=sr_1_4/104-6876453-9937550?v=glance&s=books )

There's much too much said in the book that cannot be summarized here but just wanted to throw that bone out there.

My own response to outsourcing and globalization and all is bullcaca (for those 10 year olds). My analogy is Costco vs. the neighborhood grocery stores. Globalization is like forcing everyone to travel crosstown to shop at the Costco. Makes sense, everyone knows the prices at Costco are the cheapest in town, as long as you like Kirkland products, only like having a choice of one brand of cheese, milk, batteries (no Energizers here), etc. etc. No one can argue the economic and financial success of super warehouse chain stores.

However, I also like the convenience of having a grocery store that's closer to get to. There may even be a corner store or two, I can choose from or choose among the local produce stands. I'm more likely to know the names of the employees in the neighborhood stores. Those employees might even be my neighbors.

From a purely economic financial argument, who can argue with getting rid of all those neighborhood stores and only shop at Costco? It's the cheapest way to go, right? Who needs the diversity of community and neighborhood? Who wants the convenience of walking to a corner store to pick up a quart of cream when you can drive crosstown to pick up a gallon of cream for the same price?

Apply that analogy to a global scale and different markets, like textiles, tvs, and radios. I think having a self-sufficient local market adds value beyond just financial and economic. What's wrong with trying to keep our engineering expertise within our national borders, state borders, and even city borders? It adds diversity and sense of community from the local level on up. Why should all our engineering expertise belong "cross-town", like it now does for so much of other kinds of manufacturing from textiles to tvs to radios.

End of diatribe. On another note, I heard that cattlement in Mexico are now in a sorry state, thanks to Nafta. They can't compete against US cattlemen. Free markets in action, right? Well, now those cattlemen are turning to the only other option they have: growing drugs - something they know they can compete successfully at versus their fellow brothers on the other side of the border.

Jay
Tuesday, August 05, 2003

My arguments generally are not that I'm entitled to a 6 figure salary because I'm an american programmer.  I figure that anybody who's a savy and hard working programmer should be entitled to a 6 figure salary, weather they are in India or in America.

Similarly, I object to H1B visas because I think they are unfair.  I'd rather have a slightly smaller number of outright green cards and/or opportunities to immigrate. 

Flamebait Sr.
Tuesday, August 05, 2003

Basically take notions of nationality out of the discussion... the question becomes:

Is it reasonable for a country to sell goods and services to another country?

Is it reasonable for companies to operate in more than one country?

Is it reasonable for a company to hire employees in each of the country it operates?

You see where it's going... so it comes down to how can you make yourself the most valuable to an employer in your chosen country.  IMHO, artificial political barriers will not work in the long run (considering history).

anony125
Tuesday, August 05, 2003

Hack,

You're right. Global competition is a myth. Yeah. I just made that up. Forget about it. Nothing to worry about. All of the Americans that have lost their jobs overseas are just a figment of my imagination.

Of course Joel wouldn't attempt to compete in an environment where the entire product is stolen. Of course, nobody is discussing piracy. We're talking about companies that compete legally. Or didn't you notice?

And nobody is talking about dismantling nationalistic interests. India will protect theirs and America will protect hers. However, that doesn't mean that either country just seals up their borders and pretends the other doesn't exist.

And I wasn't slamming America; just some Americans that think it is their birthright to earn a great salary without having to worry about a foreign worker taking their jobs.

I actually agree with you that companies don't always act in the best interest of their own countries. Nothing new there. When IBM announces that it must embrace outsourcing they are adversely impacting the economy of America.

So what's the answer? Tell IBM it can't move those jobs overseas?...Oooh...See, therein lies the rub. Now you've given another inch to the massively inefficent governmental juggernaut to come inside your company and tell you how to run it. If you think outsourcing hurts the economy, wait until you've got more and more governmental control in private companies.

Hello Reality?
Tuesday, August 05, 2003

"Who needs the diversity of community and neighborhood? Who wants the convenience of walking to a corner store to pick up a quart of cream when you can drive crosstown to pick up a gallon of cream for the same price?"

Diversity? Oh puulleease...Whenever someone can't support their arguments they just toss in "diversity".

If enough people want the convenience of walking to the corner store then the demand would justify a company building one.

What you suggest is "Well, we know better than these silly consumers. We want to give them diversity so we are going to outlaw building mega stores. Yeah, prices are higher but..hey, we've got diversity."

Hello Reality?
Tuesday, August 05, 2003

"Now you've given another inch to the massively inefficent governmental juggernaut to come inside your company and tell you how to run it."

That you think the government doesn't do that shows how out of touch with reality you are.  The government decides what I pay in taxes, what I have to pay employees, how I have to treat them and in the end how they will be compensated once they move on.

So, the company decides the easiest way to remove all this "intervention" is to move the process off-shore.  We move manufacturing to Mexico City.  Why?  Because they had no minimum wage, no EPA, no environmental standards, and extemely poor people who would rather eat than worry about what they are doing to their country.  Better they have a government that does not care either. 

So your solution is "get used to it."  Learn to compete.  Well, how does a company that is not polluting the neighborhood, employing illegals, and screwing the future compete?  They recognize those are not "good things."  That the governments role is not to ensure we can bring out the worst in what we do.  Otherwise we should allow slavery.  It's economically advantageous.  At least to business.

The solution to global competion is to compete.  If you are in India looking to take an American job, then you must be compensated as an American worker would.  Having read back through your posts, I recognize you more.  You are bitter.  You see an opportunity that you cannot have so you wish to deny it to everyone.  As this is unreasonable, you smoke it in the cloud of "it's just the global economy at work."   

Truly sad...........

MSHack
Tuesday, August 05, 2003

"The government decides what I pay in taxes, what I have to pay employees,"

How does the government decide what you have to pay employees (assuming you're paying over minimum wage)?

Jim Rankin
Tuesday, August 05, 2003

Chas,

The really funny (or sad, depending on your view) part was 3 years ago during the boom when everybody thought that since they could code they were somehow 'above' such phenomena.


Tuesday, August 05, 2003

"If you are in India looking to take an American job, then you must be compensated as an American worker would."

WHY!? See...this is the problem..This American-centric attitude. You are defining the entire pay scale of the industry based on what an American programmer makes. How utterly naive.

America has less stringent employment laws than Germany does. Should American companies be forced to operate under the same employment laws? Just to make it fair, right?

I recently read an article that France is having a hard time competing in the game industry because it's employment laws don't allow it to compete in an industry where you have to let people go all the time.

Should we force American game companies to operate under the same set of rules?

Really..I'd like to know..What is the difference in saying Indian companies must pay American salaries and saying that American companies must operate under European labor laws?

Hello Reality?
Tuesday, August 05, 2003

"Really..I'd like to know..What is the difference in saying Indian companies must pay American salaries and saying that American companies must operate under European labor laws?"

Well, that's one of Howard Dean's goals.

"A trade policy that ensures that strong and enforceable labor provisions are included in all trade agreements--to ensure that trade helps both us and our trading partners shore up middle class jobs."

http://www.deanforamerica.com/site/News2?page=NewsArticle&id=7365&news_iv_ctrl=1426

He doesn't elaborate on how he's going to get the other nations to go along.

Jim Rankin
Tuesday, August 05, 2003

The real irony here is that international trade has virtually no effect on US income levels.  Remember all that hoo-hah about how manufacturing jobs going overseas left unskilled factory line workers impoverished?


It's <a href="http://www.pkarchive.org/trade/harvard.html">Bunk</a>.

I wouldn't expect much of a change for the export of some tech jobs to third world countries.

Jason McCullough
Tuesday, August 05, 2003

Key quote from Krugman article:

"The idea that somehow the old rules no longer apply, that new entrants on the world economic stage will always pay low wages even as their productivity rises to advanced-country levels, has no basis in actual experience."

Jim Rankin
Tuesday, August 05, 2003

Mr Reality, you presume that the operation of global markets IS in fact in everybodys' best interests and that it's some natural state of affairs.

Nothing in the economy is natural. Everything is the result of certain decisisons and policies, globalisation no less than the location of corner stores.

What is clear is that some relatively smally groups of people benefit substantially from globalisation while large numbers of people all over the world are harmed.

There is still a fair bit of debate on that subject, even though large financial interests spend fortunes trying to find every piece of useful research they can.

analyst
Tuesday, August 05, 2003

"If you are in India looking to take an American job, then you must be compensated as an American worker would."

The statement doesn't stand up to reason... by the same token, would you also say 'If you are in Cheyenne (Wyoming) looking to take a New York job, then you must be compensated as a New York worker would'?  I imagine the average wage in Cheyenne is different than in New York.  Is it unfair to New Yorkers that people in Cheyenne are making a living?  Maybe even doing the kinds of jobs that can be done in New York??

Why not let the good people from Cheyenne have a fair crack at the jobs that people have in... anywhere! You name it.

It all comes down to:

    Free Market

anony
Tuesday, August 05, 2003

I don't whether you're aware, Mr Reality, but part of the agreements imposed on sovereign nations by the WTO is a requriement that the nation actively suppress political dissent resulting from the effects of those agreements.

For example, demonstrations by people sacked from their jobs.

Now, that, to me, likes the heavy hand of government being quite forcefully applied in the interests of this allegedly natural globalisation state of affairs.

analyst
Tuesday, August 05, 2003

>"Eventually, Indian programmers will earn 30-40k/year, and then they'll stop being quite so competative."

They are already more expensive than that if you add in total costs like real estate and telecom and the markup of the firm.  The popular outsourcing firms like Infosys, Satyam, and Cognizant charge US$30-$40 per hour.

Indian programmer salaries have more than doubled in the last 5 years, and while their salaries have shot up the quality of workers is going down, as hiring standards had to be relaxed to fill the seats.

My problem is not that I feel I can't compete with cheap overseas labor.  In fact I am quite confident I can compete when put to the test.  When counting total costs, they can only pay for about 2 experienced Indian programmers for what is costs to keep me - not the 5 or 10 that their salaries would suggest when viewed in isolation.  Give me the same project as 2 guys over in India and I will do it faster than them and with better quality, because of my domain knowledge, customer proximity, and my vested interest in the long-term maintainability of the code.

The problem is that outsourcing to Asia is a management fad, not a real way to save costs or become more efficient.  Because it is a fad, management doesn't care about trying to evaluate the comparative productivity of local vs. offshore programmers or the hidden costs.  And these fads that create large followings in pursuit of hyped-up profits eventually collapse, leading to economic meltdown like the dotcom crash.

T. Norman
Tuesday, August 05, 2003

"to ensure that trade helps both us and our trading partners shore up middle class jobs"

as a man earning a middle class income I feel I have a complete right to say this:

if my job needs 'shoring up' then I dont want it.

I am _not_ a charity case,  I have earnt my way for my entire life and I am _not_ planning to become dependent on the state to ensure my lifestyle now.

Let them send jobs off shore :)  Im good enough and smart enough to find other ways of making my money.

and if Im not, then Ill deal with that as well.

but lets face it, if 30% of jobs go offshore then that leaves 70% here at home, I am _definitely_ one of the top 70% of programmers and so I will fight my way into a job again.

and if the wages are too low then I _will_ find a better job elsewhere, I do not need government protection to do so.

<g> frankly Im rather looking forward to an industry where the bottom 30% of programmers have been removed from the gene pool.
Imagine looking through the legacy source of a company and _not_ wanting to break open the skull of the previous programmer and pour its contents into a steel box simply to ensure that they never get a chance to perpetuate such hideous code on a vulnerable world again.

heres to the future :)

FullNameRequired
Tuesday, August 05, 2003

All of the smartest folks from Asia have moved to the western world.  I'm not saying all smart people leave those countries, I'm just saying... if you have the means you do.  I don't think it's a good idea to entrust your business to 2nd tier developers.  Companies will learn that the hard way if they must, but I don't think we need to worry about too much job loss to Asia for software development.

chris
Tuesday, August 05, 2003

> This of course begs the question (yes, "begs
> the question" - sorry if that's too dorky for
> anyone) of whether global competition is in
> our best interest.  Doesn't seem to be in my
> best interest, so is it okay if I oppose it?  I left
> my "Free Market Virgin" card at home...

What you want is the congress to pass a law making software development oursourcing illegal, or at least making it more expensive to oursource (by using taxes).

That means, you don't want people in India and Eastern Europe to produce software and export it to the US (because this is what's happening).

The problem is - this exporting thing goes both ways:

Eastern Europe, India, China are going to be (or are already) huge markets for products "made in USA".

So, if you impose taxes on software developed in Eastern Europe and exported to the US, it is only fair for us to impose taxes on US products imported into Eastern Europe, which (for now) we don't.

I think this is the reason your government doesn't want to stop the oursourcing phenomenon.

a developer in Eastern Europe
Wednesday, August 06, 2003

If my experience of the quality of their software/staff is anything to go by, the competition isn't going to be from places like India, its going to be from Eastern Europe. Not one of the people from India we had were any good, whereas my experience of developers from Eastern Europe is that they are, to a man, brilliant. This is of course a gross generalisation, but such has been my experience. I think it must be an education thing, because the British-asian software people have been every bit as good as their white-British counterparts. Oh, the Chinese I've worked with were all good, too.


Wednesday, August 06, 2003

The more people know how to code, the more factory-like the business will be. That's why the good coders should move from coding to designing. There are people who design the stuff (like car designers) and there are the people who make those cars (the factory people). It happened to automotive makers, it will (and is) happening to computer industry as well. That is the main reason why the companies are even thinking to outsourcing the coding to some cheap labor countries.

What is the downfall?

It is the fact that if you fully outsource, you will also lose your core competence: The designers. The code writing can be outsourced to other company, but it will be succesfull only if you know what to order. If you don't know, you will end up in countless discussion, delays and headbanging. And finally you got something you did not order. A good designer helps in here. He designs and writes the requirements, and then controls that outsourcing company is doing what was ordered.

What comes to simultaneous development (a manager saying we produce coude 24 hours a day because we outsourced some of the development to country X) is not easy. You can maybe code 24 hours a day, but information flow will slow down significantly. Even a 3-4 hour difference in timezones decreases the effective communication hours to too low. Instead of tackling the problems within a day, you now have to wait a day for an aswer and propably have to iterate the questions/answer couple of times. When working in same time zone the questions might still needs couple of emails to send (or phone calls), but you can solve things within a day. This is usually something that is not taken into consideration when deciding about outsourcing.

RW
Wednesday, August 06, 2003

I think it's sad to see such sentiment that is so willing to let their own industry and work to be marginalized, relegated, and outsourced in droves to other countries.

There's a sentiment out there that says, "to each his own, my position is fine. So what if 30% of the work is outsourced, even 50%, even 99%!! I'll be in that 1% that will thrive."

That's a sad state of affairs for an industry that once drove the US economy. At best, that's a zero-sum market that lacks the drive, energy, entrepreneurial spirit and competition that drove the industry to its heights. There will be growth, but it will be generated offshores. At worst, it means a shrinking local market, where for every dollar you make, you've taken 2 bucks away from others.

Even if you are in that 1%, what are your personal growth prospects in a market that has shrunk to 70, 50, 1% of its former size? 5 to 10 years out. I doubt many of us will have the same job, work, or company, so when we look for that next position, and wages on a whole have stayed flat or even dropped, we won't be happy campers.

OTOH, I think everyone agrees that outsourcing is great for corporations. It increases the barriers to entry even that much higher. They've secured their position a bit more from nimble startups. In the past, those startups may have underpriced their larger competition, but that's more difficult to do since most startups hire from the local job market.

Startups don't only compete on price but they innovate as well. However, shouldn't they be allowed to innovate on a level playing field with the larger fish in the ocean?

Somehow people justify outsourcing because it's been labelled with "free-markets" and a more competitive industry. Unfortunately, for me, it's much more complex issue than that. In my view, outsourcing is being used to stifle and kill competition in the local market. Consequently, that competition is being created offshores, which is great for them, corporations, and that 1%, but not so great for the rest of the country.

Jay
Wednesday, August 06, 2003

With you all the way, Mr Eastern Europe. It's straightforward fair dealing. If the US is allowed to impose tariffs on cheap programming labour, every other country should be allowed to impose tariffs on things the US can provide more cheaply. That's pretty much everything.

David Clayworth
Wednesday, August 06, 2003

"What is clear is that some relatively smally groups of people benefit substantially from globalisation while large numbers of people all over the world are harmed."

.....except the poor countries that do lots of international trade have spent the 20th century getting far richer, while the ones that have little or nothing in the way of exports have stagnated.  If you have evidence that "globalisation" makes the third world poor, I'd love to see it.

"The problem is that outsourcing to Asia is a management fad, not a real way to save costs or become more efficient."

Agreed.

Jason McCullough
Wednesday, August 06, 2003

Jason, the countries that embraced globalisation the most are the South American countries, and they are now in deep economic distress.

Secondly, in third world countries, the beneficiaries of those nice figures the WTO presents are the ruling classes. There is much greater class division in those countries.

analyst
Wednesday, August 06, 2003

Funnily enough, I think the geeks claiming they're among the top 70 percent are precisely the ones who are going to suffer. The smart people understand how the world works and will be able to move on and adapt.

The "top 70 percent" are the ones who, in five years time, will be complaining that they can only get $5 per hour for hacking open source projects. In fact, this whole trend will start to reduce the average expertise of programming.

.
Wednesday, August 06, 2003

"The smart people understand how the world works and will be able to move on and adapt. "

:) thats exactly what I was saying. I _dont_ need the government to legislate to protect me.
If I cannot find a niche then, frankly, its time for me to retire.

"The "top 70 percent" are the ones who, in five years time, will be complaining that they can only get $5 per hour for hacking open source projects."

:)  you didn't actually read what I wrote did you?  <g> If I was as stupid as you Id hide my anonymous nickname as well....

" In fact, this whole trend will start to reduce the average expertise of programming."

bingo!  that was my point.  you certainly took a strange route to get there though...

Maybe Ill be in the top 70% and maybe I wont, but if Im not then I certainly do not deserve any government protection because of it.
Maybe being in the top 70% will enable me to get a decently paid job in the programming industry, and maybe it wont.  If it doesn't, thats not the governments problems to solve (they never told me to become a programmer), its _my_ problem to solve.

personal responsibility is tough aint it :)

FullNameRequired
Wednesday, August 06, 2003

May I say that I intend to spend as much time as possible advocating Open Source Software development outsourced to India, just to annoy all of you who loved to make software to automate other people's jobs and then sell it to other countries, and then whine and bitch because you might lose the fancy house and the SUV.

Stephen Jones
Thursday, August 07, 2003

Yeah, especially the SUV because its pouring out all those pollutants.


Thursday, August 07, 2003

<i>Jason, the countries that embraced globalisation the most are the South American countries, and they are now in deep economic distress.

Secondly, in third world countries, the beneficiaries of those nice figures the WTO presents are the ruling classes. There is much greater class division in those countries. </i>

The South American economic crisis is about the voltality of unrestricted capital flows, not manufacturing trade.

And you're in for a surprise if you think trade makes the poor of the third world poorer.....

Jason McCullough
Saturday, August 09, 2003

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