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IBM Shifts 14,000 Jobs to India
Omar Khan writes "The New York Times reports, 'Even as it lays off up to 13,000 workers in Europe and the U.S., IBM plans to increase its payroll in India this year by more than 14,000 workers.' Slashdot previously covered the black-and-blue strike, in which the union wondered, 'if other cost cutting mechanisms could achieve the same effect without cutting so may jobs.'"
I'm sorry but IBM is speaking to European workers very clearly here, however I'm not sure they're listening. The constant strikes, the 5+ weeks of vacation, the voting down of the EU constitution to avoid US-style capitalism. These jobs are vanishing into India because of the cost and headache of dealing with European unions, workers, culture, and bureaucracy. Frankly it's a pain in the ass, and for a market that often has little growth potential. Asia isn't just where the cheap labour is, it's also where the growth is, and the governments eager to work with you, and the best bang-for-the-buck for companies seeking to invest. Until European workers learn to compete aggressively we'll keep on hearing stories like this of companies that just shrug and say "fine, have it your way." Apologies, but something's gotta give.
Individual companies can't get away with shipping jobs to India due to the offshoring stigma, so what do they do? They hire consulting firms like IBM who basically do the dirty work for them. Problem solved; good cheap labor at a fraction of the cost without it being a PR nightmare because technically the company isn't offshoring. I've seen this happening more and more. Kind of scary.
Top 10 Reasons To Procrastinate
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[This is purely anecdotal, not meant to be prejudicial]
The biggest difference I've ever noticed is mostly cultural.
It seems that Americans are more used to questioning and saying things like "are you sure you really want to do it this way??", whereas Indian programmers just seem to do what they're told, regardless of whether it makes sense.
For example, my wife works at a large financial firm as a project manager. They had to stop giving new development to an Indian company they were working with because the work turned out to be barely functional. This was mostly due to the specs not being complete. She said she almost never got questions about the requirements and just received a bad product at the end. This same company was exceptional at porting older applications to newer technologies and they still do that today. They just don't get new work.
Granted, the root cause of the issue was bad requirements, but American designers/developers would have balked at it and questioned it more, resulting in a better product.
(NOTE: Some of this hesitation is probably due to fixed-price negotiations and time limits along with time zone differences and the difficulty of back-and-forth requirements gathering with people in a different part of the world. YMMV)
---- It puts the lotion on its skin or else it gets the hose again. It does this whenever it's told.
Um -- you're not paid based on how much money you generate for a company, you're paid based on how replaceable your job is. Guess what? If the janitor stops taking out the trash, eventually the company stops making money. Are the janitors worth a billion dollars a year? No -- because they're paid based on the value of the work they do. They are easily replaceable.
Same for engineers. You are paid based on how unique your work is. If your work can be easily replaced by another engineer, you're low paid. If it is sufficiently unique, then you are higher paid. Supply and demand, man. Supply and demand.
Want to be the one who collects the money at the top? Easy. Start your own company and create some jobs of your own.
Unions can create temporary bubbles where you get higher pay than you deserve, but ultimately it hurts you. Would you rather have a 20% more pay temporarily, but then no job at all when it's outsourced, or would you rather have more stability, just at a market wage?
Europe is choosing "no job" every day.
Sometimes it's best to just let stupid people be stupid.
And the response of these workers and others in Europe is that they don't want to be chattel/wage slaves. Shocking isn't it? It seems like people in Europe can somehow envision a world where there is such a thing as enough profit, and that at the end of the day corporations exist for the betterment of all of society - not vice versa.
One of my old bosses had a great expression - "Trees don't grow to the sky." It was in relation to commodity trading, but it's applicable in many areas of life. Growth can not be infinite - it's simply not sustainable. At some point you need to be satisfied that you're running a profitable business, creating valued products.
Causing unemployment in Europe and the U.S. to save a couple sheckles on the front end will ultimately result in less wealth and less growth in the long run. You need someone to buy your products, and as others have already pointed out, the unemployed and minimum wage workers of the world aren't going to be able to do so. All the arm chair "free marketers" need to dig a little deeper with their analysis than parroting "corporations are in business to make money" and thereby whatever they do in that line makes sense - that may be a primary goal, but it certainly doesn't valildate or justify every decision corporations make.
Greed is good only works up to a point - after which you start eating your own young.
> Want to be the one who collects the money at the top? Easy. Start your own company and create some jobs of your own.
There, in a nutshell, is the problem. The system we have now is designed to funnel the profits into the hands of a few people, and after multiple decades of this, you end up with a situation like we have now - professionals who used to be able to raise a family in a nice home on a single income now barely scrape by with two incomes.
This is a cycle of free-market capitalism, it's inherent in the structure of business. As the money gets concentrated at the top, there's less to go around. That's why you see small businesses closing left and right, while Starbucks and Wal-Mart open yet another store in your area. Even if you have an employee-owned company with profit sharing, it will eventually get swallowed up or plowed over by a larger company whose owners screwed people over so they could gain obscene wealth.
What's the answer? I don't know. Some say eat the rich. I say form cooperatives. The solution is probably somewhere in between.
" That's why you see small businesses closing left and right, while Starbucks and Wal-Mart open yet another store in your area."
I wont win any mod points for this but ya know bashing Wal-Mart is easy but the fact is that company is successful because they play by the rules of the game and they play really well.
You should watch the bio on Sam Walton on Biography channel. I despise rock star CEO's that walk in to multibillion dollar companies and run them in to the ground. That is not Sam or the Walton family. He and his family started with next to nothing and a tiny five and dime retail store in a small town in Arkansas. They succeeded because:
- They worked really hard, and I mean really worked as in they all stocked shelves and drove around finding products to sell at good prices
- They gambled everything they had on their business multiple times and they could have easily lost it all numerous times
- They were ruthlessly efficient, it can be cruel especially to workers and suppliers but if you are not you dont succeed in retail.
- They gave people what they want, they sold the products people wanted at the best price in town. That is the classic definition of competition in retail. They did't win through bombing their competitors, or cheating or anything else. They competed, the competed well and they won.
Yea it sucks that they stock their shelves with Chinese goods but the fact is if they didn't someone else would and they would go under. Fact is Chinese goods are way cheaper than American made goods and you can't change that now unless we start restoring trade barriers or push American worker's wages down to 30 cents an hour.
Yea it sucks that they dont pay their employees very well. But you know what, running a cash register and stocking shelves are some of the lowest skill jobs around, especially in the era of bar codes and RFID. Fact is if I dont go to Wal-Mart I go to a grocery story with do it yourself checkout. You see even I can scan bar codes, feed money in to a cash register and put my groceries in to a sack, so I dont see the value in subsidizing a unionized grocery worker to do something that requires no skill. You do have to kind of wonder about the sanity of unionized grocery store workers commanding some of the best wages and benefits in many small towns. They are people with no actual skills and in free markets people are supposed to get paid based on what their worth. Grocery store workers are not worth a lot.
The other thing you need to appreciate about Wal-Mart is they have probably the most sophisticated and efficient computerized supply chain on the planet. They have giant computers in Arkansas that track every transaction in every store and make sure the right goods arrive at the right place at the right time. Your mom and pop store cant compete against that, in retail, inventory management determines the winners and losers, not sentimentality. Wal-Mart now has economy of scale almost no one else can match but the fact is they Walton's still beat their competition when they were in one five and dime in Arkansas because they worked really hard and they played to win.
All in all the Walton family are an American success story. If you are going to ridicule and crucify them for succeeding you are basicly ridiculing every aspect of Capitalism. Its is a deeply flawed system in a lot of ways, but so are all the others. The Walton's are just grand masters of the system they live under.
@de_machina