Why Outsource When Workers are Willing to Telecommute?

An anonymous reader asks: "Corporations and management resisted telecommuting for years, now jobs flow to distant nations. Did telecommuting become acceptable because of the greater distance? Because some form of on-site management persists? Because labor laws are favorable? Because a well paid middle class is a political threat? Is it really as simple as money? I'll work cheaper if I can choose where I live and work. Must I leave my country to do so?"

Comments

Apples and Oranges

[Waffle Iron]

Bosses don't think of outsourcing as telecommuting because the outsourced employees aren't working from home. They are usually in an office being supervised by someone. Bosses can relate to that; they can't stand the thought of somebody sitting at home working in their underware.

To the boss, the fact that the fully clothed workers' hourly wage is 1/4 that of the unshaven half-naked ones is another big factor.

Wrong Answer

[Dr. Bent]

Telecommuting will not save your job.
Working longer hours will not save your job.
Working for less money will not save your job.

If you think it will, then you're looking at this problem in the wrong way. You will never be able to beat the cost of offshore labor. Even if you could, you wouldn't want to. There's a reason it's so cheap...everything here costs 10 times more (rent, food, clothing, etc...) than it does in India and China.

It's like trying to beat Tiger Woods at golf. Maybe...maybe...if you train really hard, sacrifice your family and friends, and everything you ever knew or loved, you might be able to beat him in a round of golf if you were having a good day and he was having his worst one ever.

But a much simpler way to be him would just be to school his ass at Tiger Woods PGA Tour 2003' for the PS2. The game is a lot easier if you change the rules a bit ;-).

The weakest point of outsourcing is the lack of communication. Developers in India can't communicate with customers here because:

1) English is not their native language
2) There's no face to face communication
3) They're 12 hours ahead

And if you can't talk to the customers, you can't solve new problems. Old problems are easy to solve. Those are the kinds of things that can be effectively outsourced. Building yet another e-business website with a shopping cart and inventory control; Creating one more payroll processing system based on an SQL database; It's the well understood problems, where the customers know exactly what they want, that can be outsourced. Everything else seems to fail.

And that is the IT Industry's saving grace. Using new technology to solve new problems that are not well understood will always have to be done here, because solving those problems requires constant and effective communication with the "customer" (the users of the sofware).

Software is slowly and painfully learning the lesson that manufacturing learned a long time ago: "Build where you sell". If engineers can't talk to the people who will be using thier products, they won't know what to build. Most problems in software are not well understood enough to be completely spec'd out by an intermediary party and passed onto the engineers for implementation. That is why lots of outsourcing ventures fail, and that is why the innovators here in the States will always have a job.

Re:It really is that simple.

[SpaceCadetTrav]

If everyone took jobs for $28k, who is going to pay for universal healthcare?

Re:Silicon Valley on the cheap. I did it, so can y

[Tackhead]

> I make close to $200K. I parked the Navigator and Viper and started taking Caltrain. I save $200 a month on gasoline, and I get work done on the train instead of sitting on hwys 17-85-101 on my way to work. Instead of the $10 I spent on two lattes per day, I now brew my own coffee in the morning and carry a thermos. Thats another $250 per month. Movies every weekend? Fuck that; NETFLIX rocks, and I can make a dozen hotdogs for what one costs at the Mountain view cinema. $50 per month.
>
>Going to Nola's or Baha Fresh everyday for lunch? Not anymore dude. thats $300+ a month reduced to $100 by bringing my lunch from home. Now that I ride the train, I dont stop at Fry's twice a week to "just look around" like I used to tell my wife. An easy $150 a month saved just by staying out of the book/CD/game aisles. If I need something now, Ebay has it. Drinks after work with my team? Once a week instead of 3-4 times. Thats another $100 saved.

After-tax, he's saving $200+250+50+200+150+100 = $950/month.

Now dig this. With combined California + Federal taxes on $200K at around 43%, that after-tax savings is equivalent to a pre-tax salary raise of $20000 - about 10%.

> If you can give up some of the ego stuff, you can live just fine in the Valley.

Preach on, brother. You just got yourself a 10% raise, with zero change in your standard of living. (Well, apart from no longer "just looking around" at Fry's, but hey, we all gotta make sacrifices. I'd spend less time "just looking around" at Fry's too, if someone was giving me a $20000 raise for it :-)

Suggested summer read: The Millionaire Next Door: Surprising Secrets of America's Wealthy.