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Techies Asked To Train Foreign Replacements
Makarand writes "David Lazarus of the San Francisco Chronicle is reporting that Bank of America (BofA) is moving thousands of tech jobs to India and has asked its techies to train their Indian replacements or risk losing severance pay. Although there is nothing in writing that says precisely this, the employees have been made clear about this responsibility in their meetings. BofA is outsourcing tech work to Indian companies whose employees do the work at half the cost of what a U.S. worker gets paid. According to an estimate, outsourcing has allowed the bank to save about $100 million over the past five years."
I've been with B of A since the mid 1980's. The past couple of years they have begun making this loud sucking sound. They suck fees out of my account that lowers it below a threshold and then suck more fees out. On one single day after I screamed, they credited back over 200 dollars in fees into my account. They've been putting 5 business day holds on Govt. checks that used to go in as cash. They obviously have the fees dept. going full tilt, along with the bean counters. I'm moving soon and as soon as I'm settled, they're history. I've had it with them!
This is just more fuel for the fire. Next there will be an article about some CEO complaining about how there aren't enough skilled IT workers in the U.S. and how college students are not entering the field. I just don't understand how U.S. companies can continue to build up so much ill-will (or bad karma if you will) with practices that BoA at least acknowledges are offensive and yet continue said practices. A big price is going to be paid for these betrayals someday, a very big price.
To the making of books there is no end, so let's get started
"And which bank would you change to?"
Why not join a Credit Union? They offer the same services, tend to be local and regional (which helps the local/regional economies) and in my experience their customer service is far better than that of commercial banks.
Best of all, they are non-profit, which eliminates the greed factor that drives outsourcing.
My experience: for each guy you fire, another one gets panicky, looks for a new job, and finds one. You can fire the guys you need least, but guess which one of the others will find a another job first... And then, train a foreigner, knowing you are getting the sack. For fuck sake, this is a BANK! All you need to do is to claim the indian guy doesn't understand your accent, throw in some "unfortunate misunderstandings", and the whole IT dept is on its way to hell. If I had money there, I'd run for my life.
10 ?"Hello World" life was simple then
Meanwhile as a native, you have to pay for all of that FOR them out of your taxes, then you have to pay car insurance, car taxes, property taxes, medical, dental, vision, you have to send your kids to a private school because their kids have ruined the public schools, you can't goto the hospital because illegals are clogging it up (I had to wait about 30 hours to be seen when I broke my leg!). Illegals turn your nice community into a shit pile and your house gets broken into constantly ... Oh, and your teenage kids can't jobs because all the low skill jobs that teenagers used to do are taken by illegals (mowing lawns, bussing tables, etc).
And then the march in the street waiving foreign flags on American soil, telling you that the US owes them citizenship.
Sorry, I needed to vent.
Religion is a gateway psychosis. -- Dave Foley
In Belgium this would most likely be such a union issue, they would not even try it. I know to Americans unions are the evil of all evils. Due to them I get severence pay of 7 months after working only 2 years at a job and they decided to scrap 50% of the people.
What they do hee with outsourcing most of the time is sell off the IT department. Many people will not want to move away from their life and family, so that cuts down in staffing who they then can replace with cheaper people.
Don't fight for your country, if your country does not fight for you.
Can a company get by with less compliance to SOX when they offshore? How much of a savings would that provide?
Actually, the entire premise you're building on there is bass-ackwards. If such a transition is properly managed, the gains are long-term: a fundamental change in the IT cost structure. The trick is that these arrangements aren't a slam-dunk, and they require rock-solid management. They're difficult, but they can work - and when done properly, they do provide long-term benefit to shareholders.
Stop by my site where I write about ERP systems & more
What you say (global wages will even out eventually) makes sense to a degree but I don't see why socialist/capitalist is a binary choice, some things just don't lend themselves well to "the market", health care being a prime example.
And did you exchange a walk on part in the war for a lead role in a cage? - Pink Floyd.
Train them wrong so they will break everything they touch. Revenge is a dish best served cold.
Even better, tell them how it's supposed to work. If you have a manual, you're practicly reading it aloud to that guy. Make sure not to mention any of the quirks, bugs, workarounds, checks, errors, details, omissions or unwritten routines that you've accumulated that is the real value of an experienced employee. If you have some slightly out of date ones you could "accidentally" use, even better. That'll cover your ass much better, since you didn't train them explicitly wrong and can point to that documentation as proof. If the documentation is like 95% of all documentation I read, they'll be just as useless.
labour would get a whole lot more competetive (maybe even maintain the current standard of living at half the pay!)
You hit the nail right on the head. The problem is not that Indians (and Mexicans, for that matter) are "stealing" our jobs, it's that they are willing to do it for a lot less money. Honestly, you can't blame the companies for going with cheaper labor that can do the job just as well, or close to it (though forcing the American workers to train their replacement is a different story). If Americans were willing to work for lower wages, then labor wouldn't NEED to be outsourced. Of course, the problem isn't only that Americans aren't willing to work for lower wages, it's that we often aren't able to, so what you're saying, or something similar to it, would be the way to go. If Americans started to work for less, basic (and slightly simplistic, but still mostly valid for an approximation) economics says we would pretty much maintain the current standard of living, but only in the long term. In the short term, it just wouldn't work, because it only works if EVERYONE is working for the lower wages. The "early adopters" would be screwed until everyone else's wages went down by the same amount, at which point prices would also come down to meet demand. So the way to do it, as you say, is to start out by lowering prices a bit (revamping copyright/patent/monopoly law would be a reasonable start, though some would argue monopolies would help with this transition) and let that naturally be followed up with a lowering of wages, then rinse and repeat until we're competetive on a global scale.
Another way to ease the trasition would, of course, be to cut taxes like whoah. Americans pay, on average, a net of about 40% of their income to the government (not only income tax obviously, but including basic economic principles such as "corporate taxes raise prices," etc.). If we were to cut down on pork-barrel spending alone, that could probably be reduced to 35%, maybe even as low as 30%. That means the average American can take a pay cut of 5-10% without changing his net income at all. Then if you're willing to cut government programs that don't quite count as pork-barreling but still provide less benefit than what they cost, you could potentially bring total taxes down to 20%. That means we could bring wages down even lower (20% lower) without hurting the average American household's standard of living, with the exception of those who rely on whatever social programs are cut. Even still, losing a program is preferable to losing your job to someone overseas.
I have an apt analogy.
Yesrs ago, I sold auto parts at car dealerships, mainly to body shops. A good-sized local body shop chain was buying parts from us for 5% over cost, delivered. They came to us and said that they were going to switch to someone who would sell them parts at 3% over cost, delivered, unless we could match it. We let them go.
About 18 months later, they came back: "We want to come back to you." Why? Because my company could provide better service. The 3% over company would deliver parts once a day, that's it. If something was missing or wrong or broken, they wouldn't try to find it someplace else and do a second trip that day, they'd just order another one and deliver it when it came in.
So when this body shop chain came back to us, we said, "Okay, but it's 10% over cost now." They agreed.
The moral of this story? Maybe in five or ten years, when US industry figures out that the front-end savings they're getting on offshored labor translates to a higher "total cost of operation," they'll come back to the US labor market. And when that happens, salaries for US tech jobs will rise.
I'm prepared to ride it out.
Web 2.0 == Giant Blogspam Circle Jerk
Do you know how much these people make relative to their standard of living? I've talked with people from the Manila outsourcing area in our company. All of them have their own personal drivers for their brand new expensive cars. All of them have maids and nannies to take care of their children. All of them have big houses that would make your mouth drop open if you saw it over here.
The facts are that if you were to earn the same cash here you would need to be paid 300k or more to be able to afford these things. What honestly makes you think they care one wit about things American when they are earning that kind of coin compared to other citizens in their country?
I agree with this, but as a small business owner that uses a CU they don't have things like:
SBA loans
Credit card processing
Alex
"The Brady Bunch is back...working homicide"
This is really a good thing for the U.S. society, which is capitalist.
In a capitalist society profits for the capitalists are always supposed to increase. This will increase profits, so it's a good thing for the society as it is set up right now.
If the Americans want higher wages they should consider switching to a system which has as a goal that isn't the exact opposite: sustenance wages for all employees, high profits for capitalists.
I mean, this is how I see it anyway. The worth of something to society has to seen with regard to the aims of that society. Being capitalist the U.S. society's aim is to maximize profits for capitalists, and so, to minimize wages for free-laborers. Anything which inhibits that can only been seen as socially bad.
I don't agree. I advise making your very best effort.
Twenty years ago, something like his happened to me. I was the engineer in charge of manufacturing systems test for a packet switched network when the headquarters decided to move manufacturing to Southern California and shut us down. The test guys wanted to sabotage everything and asked me to help. I told them I had a better idea. Let's do the very best we can knowing that they will foul it up anyway".
You know what? I was right. The fouled it up depite all our efforts to help them. Frankly, I think it was more satisfying that way. Even when I found out years later it was an article of faith down there that I had sabotaged everything and that's why they had so much trouble.
companies are allowed to maximise their own profitability and they can do this by outsourcing.
It is questionable whether this is true. Usually it is not a company that maximises its profitability, the managers are maximising their own income. If they cut costs in half, in the short run the company will be more profitable and they can raise their own salaries, get a huge return on their stock options, etc. In the long run, they don't care if the company goes down, they have left their previous post a long time ago. Capitalism works if it is in the best interest of all employees, especially upper management, to make a company profitable. Unfortunately, that is not how it works in practice.
Is the fact that these replacements will be trained by current employees bad?
Yes, it is. If I was forced to train my replacement, I would do a pretty bad job. I would give him source code (maybe that three weeks old version which has some obscure bugs in it), some out-of-date documentation, tell him a bit about what the programs are for, and end with, "if you have any questions, don't hesitate to ask." Believe me, there is no way he will be able to ask the right questions before I have left the company. After a year or so the shit will really hit the fan, and the boss has two choices: either hire me as a consultant, for which I will ask an exorbitant amount of cash, or suffer the complaints of angry users. In the end, the company will have to bear the losses.
Now, the way to do some successful outsourcing, is to fire the employees who are rubbish anyway, and promote the remaining employees yo a job as coordinator of outsourcing. Then you have the people who know how to do the job guide the people who are doing the job. And your new coordinators will be pretty happy about training their replacements because they benefit from it too.
I'll end up by telling you a true story. I once worked at a software company, and we got a big job for maintaining some specialized software for which there were a few dozen clients. The guys who originally wrote the software were too expensive for the company where they worked, so they fired them all and outsourced the job to us. Our first task was to make a small change to one of the programs. Unfortunately, the system was constructed in such a way that you could not compile just one program, you had to compile them all, and deliver new recompiled versions of all programs to all clients. We tested our change and delivered the programs to the clients. We soon found out that the guys who had written this stuff had been pretty angry for being fired, and had riddled all programs with small bugs. Not things you would notice immediately, but things that would rear their ugly head after working a while. There was no good way to trace these small surprises, the only thing we could do was fix bugs when they were reported by clients. We had one client who had to restore backups on a daily basis. After a year, ALL the clients had dropped the software and moved on to a competitor's product. Those are the dangers of "insensitive outsourcing".
So, if they don't pay taxes or for insurance, what is the best solution? Send them back to wherever they are from so they seize to be part of american industry, further weakening our competitiveness in international trade? Or give them citizenship so they WILL pay taxes and WILL have to get insurance? Then they will be paying for public education and subsidized healthcare, just like everyone else. Problem solved.
Ruining the public schools? There are plenty of dumb American kids to do that, and that HAVE been doing that for years.
Furthermore, I would like to point out that your kids have no right to employment, and if they price themselves out of the market that's their own damn fault. If someone else is willing to work harder for less money, how exactly _is it_ that you expect a market economy to act?
====
Crudely Drawn Games
- Your credit union probably outsources their credit card service to someone like MBNA. Which is owned by Bank of America.
- At least until Check-21 went into effect, most banks could return your cancelled checks to you. Check images are miserable.
- Many credit unions in my area have decided that it's not enough to serve their existing base, they have to grow their membership and will now take just about anybody -- probably because their existing membership is getting laid off by the large companies who facilitated the CU's creation in the first place. And to handle this, they're jacking up fees. Honestly, I think they go visit the banks every 6 months, assess the bank's fees and jack up their own to some percentage of the banks so they can still say they're cheaper.
You exist solely to be asset-stripped - your skill, your energy, your money, your property. Get used to it.
I had a savings account with them for about 2 months, i wanted to get a checking account but they didn't offer any free checking. I called their support to cancel the savings account and was speaking to someone in india. As soon as I asked to cancel I was then transferred to someone in america. OK.
Anyway I closed the account and went with another bank that did have free checking and never looked back.
If you don't want someone to copy something, don't give it to anyone.
It amazes me that this is your perspective. Perhaps you are trolling but I'll take you at face value.
The US welfare system which is woefully inadequate, in combination with its lack of social mobility result in a more or less permanent underclass of hopeless individuals. For you to say that the US system is a social "hammock" tells me than you have little knowledge of the world outside your borders. Most of the rest of us in the "West" have much more redistribution of wealth than you folks do and yet, people still go to work, there are still thriving and successful global businesses which come out of the various countries in Europe plus Canada, all of whom have a sane and humane social model which stands as a stark accusation of the great waste of human potential in the US. The fact that the richest country in the world, with the highest health care spending per-capita, still can't find its way to provide basic health insurance for every citizen is repugnant. For the sake of ideology it seems, folks in the US are willing to stand by and watch people die for lack of decent health care, and live without a hope of a better future for themselves or their children.
I'm afraid that you have been listening to the words of others without giving them much thought or investigating for yourself.
Executives ofte cut positions to make sure that the company meets the quarterly goals which will allows them to receive the obscene bonus. The issue here is that cutting jobs to get their bonus is not possible as IT people are needed to make sure the company does its job. The current fad is to replace current US workers with foreign workers that can be payed a lot less. However, there are many hidden costs with that (mostly job done incorrectly and not to spec). I have been involved in many outsourced projects (as a subject matter expert) and it took me twice as much effort to get them to understand what is required and how to do it efficiently... and in almost every case the code was subpar and buggy and followup cleanup projects had to be scheduled with in-house staff which costs them more overall, but the projects are rated individually and the outsourced version 1.0 was extremely cheap to produce (example of one of the more recent projects is 4.5 million) as opposed to inhouse estimate (same project was 6 million); what was not counter was that the followup to cleanup the mess cost them 3 million and here the outsourced project wound up costing 7.5 million and took 50% longer, but since the executives usedtheir funny math and spin it looked like they actually saved money for the company instead of losing it and I am sure they got their insane bonuses while I had to work weekend to help explain what the specs mean to some underqulified foreign workers (the qualified/smart foreign workers were smart enough to get hired by US companies and move here on H1B, the not so smart are what we pay when we outsource).
If I had to train my own replacement I would definitely do the worst possible job just meeting minimum reqiurements (just what most executives have done in their decisions).
. . . so, they have many of billions of dollars of income that are completely insulated from any possibilty of consumer anger over this. In the Federal Civil Service, and travel for work? You HAVE to have a BoA travel card. Officer or senior enlisted in the military? You HAVE to have a BoA card, no choice. And you are required, by regulation, to use the BoA card for most official travel expenses, or you don't get reimbursed for them. I wish I could drop my BoA card, but eating all the costs for the little trips Uncle Sam sends me on isn't really an attractive option. So, not only is BoA shafting it's techies, Uncle Sam is subsidizing the process.
I used to work at a software company, where I did technical support via phone, email and fax, plus webmaster work. One time I took a vacation. One of my bosses decided she was going to do my job while I was out of town. When I got back, she gave me a raise. She went crazy doing my job and couldn't believe I was doing it. When I eventually quit that job, I had to "train my replacement". Same boss asked me to come back 3 months later because she'd totally screwed up the web site. So I came back for 3 months on the condition I'd only do web work. They had 2 people doing my tech support job. LOL. Three if you count my boss messing up the web site.
What Western countries with high rates of wealth redistribution are thriving? The last time I checked (admittedly over a month ago) a lot of Europe had double-digit unemployment rates. There is also the little problem with Europe's demographic implosion which is going to make things even worse in the coming decades.
Although I'd be against a totally free market civilization, I'd rather have a society that is heavily tilted towards capitalism than one that was mired in socialism.
"Any services you know of that a bank can do a CU cant?"
yeah, give me a VISA check card (Golden One CU runs a credit check before giving out what EVERY OTHER FUCKING BANK IN THE STATE DOES), not hold deposits more than $500, and actually have some farkin branches.
I still have a CU account because all of the branches are too far away for me to go close it, but they treat me like shit. Oddly enough, Bank of America has actually given me *less* trouble than any other bank I've ever dealt with.
Credit unions suck as much ass as most banks do. Don't fool yourself.
I had Bank of America. Then I switched to a credit union in 1997. No more weird fees, no more impersonal service, no more problems with getting a car loan due to old roommate credit "issues". Decent interest rates, and a warm sense of "belonging", and a knowledge that my money isn't being used to prop up a for-profit enterprise, just a non-profit one, that offers a tangible benefit to my community and fellow workers.
;) ).
Yes, we have web-based banking (not AJAXed or fancy, but does the trick), automatic bill pay (though I don't use it), direct deposit, wire transfers. Yeah, I do hate the lack of just *tons* of ATMs, but the CU ATM Network isn't so bad, if you plan ahead a bit before traveling.
Forget Mega-Corporate banking. Join your community. Join your local Credit Union. (No, I don't work for a Credit Union
The reason why companies outsource is simple -- to lower their tax liability. With FTE's, you have to pay FICA, Social Security, Medicare and other payroll taxes. If you outsource (whether keeping it in the country or not), you can deduct the whole shebang as a cost of doing business. I'm sure there are small savings to outsourcing in addition to the tax savings -- but they're nothing like what proponents claim. Administration and overhead increase as a result of outsourcing, negating a lot of the savings. Now I hope nobody mods me as a Troll or Flamebait or anything, but there is a possible solution to all of this -- ***REFORM THE TAX SYSTEM IN THIS COUNRY!!!!*** ... I am a proponent of the FairTax, which would abolish the IRS, repeal the 16th amendment, and take us to a consumption tax where the costs of government are visible for all to see. Take a look at it. You just might like it.
'He who has to break a thing to find out what it is, has left the path of wisdom.' -- Gandalf to Saruman
Enjoy the jobs while you have them.
*Snicker*
I've been there when your bullshit code comes back to the USA. We're re-insourcing projects left and right around here since the majority of your software "engineers" (and I do use that term lightly.. software technician might be more like it) seem to do just fine in school but aren't worth a flying fuck where actual code is concerned. Right now at this very moment I know of at least three Fortune 500 companies with operations within twenty miles of where I live who have brought projects back in. Our local university CS department loves you guys because we've had a crop of kids who are particularly good at debugging that have nailed some lucrative positions. The downside is that some of the stuff coming back is so screwed up that it's difficult to find architects who are able to salvage various projects, and at least in one instance the project had to be completely redesigned and reimplemented.
If we outsource to anybody it should be eastern Europe or the Canadians. At least they've got the skills.
I worked for an ex-worker owned airline.
Upper management, having reaped the benefits of worker enthusiasm and energies to make the company so attractive (this is in the mid-90's) that it was offered a buyout of the company.
But, the worker-ownership legal foundation for the company was an obstacle as the buying company didn't want to negociate with the workers or the middle managers concerning compensation for their profit-sharing incentives in the company.
What happened ? The upper management from the worker-owned company sold out to their new pals in the rival mega-corp, making a huge profit and left the people that made them that money to fend for themselves in the face of an army of laywers who eventually found a way to defraud the workers of their hard-earned share of the profits and only offering them to keep their job in the new entity and nothing more.
That's all. In this case we can see how theory and goodwill and justice stop when human greed from the upper crust starts getting into motion. The ones with the biggest power will always shaft the ones underneath if it means more money to them. It's human. And it's quite sad.
Still worker ownership remains a great idea. As long as you're not too successful.