Slashdot Mirror
The New Face of Global Competition
Valluvan writes "Here is an article in Fast Company on "The New Face of Global Competition". The article is focused on Wipro, a big IT company in India, but applies to many other companies in India that have been highly successful. A long article with some stupid errors like saying developers code with UML, but brings out the business facts well enough."
To me the first "surprise" success that came out of Asia was Creative Labs (of SoundBlaster fame). I mean, sure, we all know Yamaha and Fuji and the rest, but Creative Labs was just a soundcard manufacter... Now their products run the gamut from digital cameras to MP3 players... and they own the two remaining American professional synthesizer companies - Ensoniq and E-mu. They have research labs in the States and "back home"... Mind-boggling, really.
I got a sig so you would remember me.
And it is more boring than my hometown, Canton OH. This article gets the basic business facts right, but it neglects the massive operations companies like GE and Intel are running/starting. Many companies are doing their work inhouse at low cost here.
Makes me want to kill someone. At the very utterance of it an anything other than a purely scientific or geographic sense. The company I contract for has gone "global" now. Every possible place for that damned buzzword to get jammed in has been used.
Whats worse, the BOD has been seeded with European managers. Now, dont get me wrong, I have nothing against europeans, but you cannot take a company that has been doing NE Corridor style work processes for 20+ years and suddenly kick it over to the "european" business model. Things apparently get done a lot more slowly over there.
You wouldnt think there would be much of a difference, but its subtle, yet huge. Just the minute changes in our response contracts are huge.
Going from a 4x8 SLA to a proposed 8x36 on a hardware repair? (Which might sound great.. but it means less money, and once you have been 4x8 for five years, its REALLY hard to switch gears).
Our "accident prevention" issues are now tied to India, Sri Lanka, Korea, and europe. And we _all_ pay when some plant in some third world country where emissions arent an issue suffers some injury. I am all for "safety in the workplace".. but you should really be only tied to that which you have some influence or control over.
Its a completely different business culture, and some cultures just shouldnt mix like that.
YMMV, of course.
Feminine Protection? What is that? A chartreuse flame thrower?
but it doesn't say to much about us lot as erm.. a species
I'll take the bait posed by your cultural ignorance.
In India, the concept of a nuclear family hsan't taken hold among the masses.
Why ?
1) A billion people in that much land.
2) Taking care of elders is a vital edict of the culture. You don't send them off to "elderly nursing homes."
3) Just because he lives them with them doesn't mean he's financially dependent on them. Likely the other way around.
Having worked on a project in which large portions had been outsourced to Wipro, I can say that saying they can code Java and follow OO methodologies is lot like saying that because I have seen a football thrown, that I can play football.
Another issue many companies haven't yet realized, is that the majority good engineers in India, have left India. Those remaining for the most part are not the sharpest knives in the drawer.
The article falls over itself to heap praise on the Indian IT community (I think it ran out of adjectives eventually), but one particular line stood out to me:
They are as good at doing all of that as anyone in the world. Perhaps better. And they are cheaper -- on average about 40% cheaper -- than comparable American companies.
By what metrics are they "As good or better than anyone else in the world"? What ridiculous verbal spewage from someone throwing together a ridiculous little article. The Indian IT industry has gotten attention for one reason and one reason alone: They are very cheap (though the percentage cheaper is steadily declining to the point that it'll be a moot factor), however claiming that they are as good or better than anyone? I'm not being arrogant, but I find that there's a stunning lack of Indian software in the commercial software arena: which would be TRUE proof of homebrew abilities in an arena. Instead the industry is relegated to throwing together post-design highly-redundant type apps for countless life and bank organizations.
I'm not blindly claiming that India isn't a credible force in the software development force, but so are many other countries: This doomsdayish end-of-the-world attitude of this article just strike me as ridiculous.
ergo98
The textiles industry, which was one of the very first high-tech industries, largely left the developed world a long time ago.
I think the point here, though, is not so much that coding is leaving the "Developed" world to go to some sweatshops in India, but rather that Bangalore has become a sort of First world island: They have the infrastructure and the education, so why couldn't they compete? There is a huge danger in all of these articles, though: The United States (I'm personally a Canadian, and I laugh a bit because in some ways Canada is a mini India: We've always attracted this sort of work because of our low dollar. Indeed when this article claimed that software development in India was 40% less than the US...well that actually puts it right on par with Canada then. I think we need to advertise our sweatshops more!) could truly fall behind not because India has shot ahead (and VB type coding that they're doing now is NOT shooting ahead despite this absurd article), but rather because everyone stops going into computer science because of articles like this. Already I've seen a lot of bright minds leave computer science for "management" pathed careers, all because they've bought into the notion that the field is dead here. Of course it isn't, and this article certainly doesn't forbode any new threat that didn't already exist, and of course the mad rush to India will cease, costs will equalize, and then they'll be consumers of the big worldwide information field.
Ironic, though: It'll be interesting to see what happens when developer pay skyrockets as new shops are set up.
What ever happened to distance independent work / telecommuting, and so on? That was the Next Big Thing(tm) in the 1990's. Instead, part of this globalization trend seems to be to turn the best farmland into the best business parks. In the U.S., the asphalt of Chicago covers some of the richest farm land in the nation. Places like Sweden have be enthusiasticly paving the Mälar river valley and the plains of Scania. Germany and most other countries are doing the same? It's not possible for every country to import food and certainly not economically feasible (yet) for India to think about it.
It would be more effective to knock down the Indian variants of the late Cabrini Green -- urban renewal would be good for the people living in the city, and it would keep the programmers closer to the cafés.
Beta is broken and the link to classic doesn't work. Stop wasting our time or there won't be anybody left here.
It seems business folk like to latch onto a tech concept, exaggerate it's claims, then run blindly with it like lemmings to a cliff.
This recent love of Indian software companies strikes me like the love affair businesses had with the Internet in the late 90s. "We can run our businesses so much cheaper on the Internet!" "Banner ads will pay for all our expenses and then some!" Of course, no one bothered to really ask the question whether or not the Internet was profitable. All they saw were dollar signs and were more than happy to ignore the negative aspects of this new business paradigm. I don't think we're going to have a software "crash" like we did with the dot com bust, but anyone who thinks they can pay a little bit of money and magically get high quality code from the underpants gnomes...er, I mean India, they're going to be disappointed.
"The new face of global competition" is nothing innovative, just some really bright people that are being exploited to work long hours for low salaries because they live in an impoverished country.
Meanwhile they pull down the salaries of professionals working in america, and those lower salaries combined with the ever increasing fear of losing one's job (which is another result of global competition), so professionals decrease their spending and their standard of living and the result is a recession, we may not be able to get out of.
I am not racist and really like the fact that India is breeding smart hardworking engineers, but wish they were payed decent salaries for their sake and our own sake.
At least there is one thing that never changes. Fast Company is as always willing to give blowjobs to large corporations. I wonder what the folks at fast company received for thisd article. And i wonder if they are under pressure from third world journalist with no ethical standards.
As someone working for a company that employs over 100 engineers in India I can tell you that the skills of the average engineer there are well below those of any american engineer I have worked with. Stick with the cheap labor argument, because they are lacking in education at this point.
Firstly, I am in Indian but I dont work in India. Now to the crux of the matter. Its trur that Wipro is a great company. Infact during the peak days of dotcom boom, its chairman, Azim Premji was the second richest person in the world just behind Bill G. Wipro does have many good engineers like most big Indian software companies. But if you look at the salary of the guy, around 21000 USD, its not that low. Thats how the global economy works I assume. Eventually skilled people from poor countries get richer and to retain them the corporations have to pay more, and so the cost edge reduces gradually. Thats gonna happen with India as well, sooner or later. The only thing which is stopping this from happening is that India has a population of 1 billion, so we obviously have more skilled people as well, but still we have seen a gradual increase in the pay in IT industry and I dont think this trend is gonna stop. So eventually the competition between India and the rest will not be on price but on quality. Even my present company outsources work to India but again we feel that the quality of the work is not very good. But we can't go to a big company as it disturbs our budget calculations. But even then, now the consensus is emrging that we should give some work to a big Indian company. In future this cud be any company in the world.
What's under yellowstone?
And by doing so, the "rich world" will eventually give away so much work that they will be poor.
Historically, that's a fallacy. How many farmers are there in the US now as a percentage of the population compared to a century ago? Is the country richer or poorer now? Standards of living have gone up over the last 50 years, despite the auto industry moving overseas. Did you know that textiles was once a high-tech industry, and textile manufacturing technology was a jealously guarded secret? Where are all the textile workers now, and is the country richer or poorer since they left?
Multiply that by the number of people who earn a living here in the U.S. by writing code, and where does that leave us?
What about all the people who earned a living cleaning out stables? The country is wealthier now that those people's jobs were obsoleted by the car - and funnily, there weren't hordes of unemployed stablehands, they just went to do something else.
Before Japan started making cheap cars, their economy was similar to India's. They weren't a high-tech nation, and the Yen was very poor compared to the dollar. Then the figured out how to make cars, and how to sell them to the comparatively rich Americans. They found that even charging large amounts (taking into account the Yen/Dollar exchange) for their cars they could still attract buyers, and pay their workers well. Lo and behold, given time the value of the Yen went up due to all the money being dumped into their economy. As the relative value went up, the profit margins went down, and now Japan has been in a recession for the last 12 years.
Now, apply that model to India. What we'll see is a mad rush where everyone tries to save money by outsourcing projects to India. The US companies will see huge savings (I disagree, but that's a different argument) and the Indians will see huge profits (again taking the exchange rate into consideration). However as the Indian rupee gains in value, the economic attraction of other countries to outsource to India will fall.
Hence, the economy is constantly balancing itself.
This lesson brought to you by Travis
Experience has shown that 'shipping jobs overseas' actually CREATES more jobs here at home
...keep dreaming. Read the article that started this thread. India is moving into the high-end of the development process now. It's time we software engineers woke up and smelled the chai.
And what kind of jobs might those be this time? Starbucks? Burger King?
I can kind of see your point when it comes to manufacturing jobs, but now that the 'thinking' jobs are leaving I'm not sure what'll be left for us to do . In the 80's as manufacturing jobs left the US many of those displaced workers were encouraged to get into software engineering since it paid better anyway. What should software engineers be studying now? Dentistry? Auto Mechanics? (at least those jobs can't be sent overseas)
Software development isn't an incredibly difficult skill.. in particular the types of software development that is being shipped overseas.
You're deluding yourself if you think that it's only the lower-end development jobs that are being sent overseas. Check this article
. It's an interview with a venture capitalist about his take on where the Oregon economy is headed. Towards the end he talks about the impact of outsourcing engineering jobs and how that will slow the recovery in the high-tech sector. He talks about how Mentor Graphics is opening a $40million R&D center in India. When he asked them why, they told him: "they said they can't hire anyone graduating from engineering schools here because they're just not prepared, they're just not ready to go into that sophisticated end of the business." Now personally, I don't think that's the real reason (the real reason is that they can pay Indian engineers about 1/3 of what they pay their American counterparts) but that quote should be sending chills down the spine of every US developer who reads it.
I have made it a strong point to become an expert in system architecture and design, and that has kept me very comfortably employed no matter the economic conditions.
Again it would depend whether there are restrictions on flying in each case but since it is a planned procedure you could fly to Indian have the operation and stay in a recovery room there for fractions of the cost.
Indeed, this is what many britons started doing (fly to India on the start of some vacation time, and get planned surgery etc. there) I think the British Medical Society, in a move that sounded very similar to Prez. Bush's steel protectionism, objected strongly; but this isn't something that can be stopped very easily, particularly given the falling air fare
It doesn't look like you read the article - and you obviously haven't been there, or seen it for yourself. While there may be some basis for your economic theory, your notions about the difficulty of system architecture and design making you valuable enough to keep living in the 1st world are utterly mistaken. You (and I) will have to change careers, or move to the 3rd world ourselves, within 15 years. I virtually guarantee it.
In addition, due to other unrelated macroeconomic and political factors, it's getting much harder to "start over" here. Conservative politics and rising higher-educational costs might seem unimportant now, but people always find themselves thinking differently when they land back down at the bottom of the ladder.
As for America as a whole, when in a few more years we find ourselves really on the rocks and try to turn to our vaunted "education and high-skill manpower," we will discover we have neither - the price of the broom-fucking we've given public education (at all levels) over the past 3 decades.
Good luck.
Want to Know How to Cheat the GPL? Read On!