Slashdot Mirror
Reverse Off-Shoring
punkish writes "India is becoming more attractive to information technology workers from Western countries. Some local IT companies, such as Infosys Technologies in Bangalore, are now able to offer salaries and other perks that are comparable to what Western IT talent would find in their home countries. Infosys, which is currently training 126 Americans at its cutting-edge complex in Mysore, expects to employ 300 Americans by the end of 2006 and add a large contingent from Great Britain next year."
Its not exactly reverse outshoring, but it shows how tides change.
Which country will be the next cheap target?
When will we come full circle and realise that there are dedicated capable individuals in the original countries?
I speak to people from all around the world and there are examples of in-country outshoring occuring (jobs in London being replaced with staff in Manchester - its simply cheaper up North) and the London staff were just as outraged, its peoples lives the managers are playing with and sometimes the bottom line isn't that important.
I would make a terrible manager because as long as I could break even in my field I would be happy.
liqbase
The cost of living in India would be lower than the home country + comparable wages = ability to save.
MySore sounds like a painful web experience, but it's got nothing on MySpace.
Or alternatively, perhaps your job isn't the most important thing in your life. Perhaps you have kids going through school, perhaps you have friends you want to stay in touch with, perhaps your dear old mum needs a hand...
Cheers,
Ian
Anybody here old enough to remember Japan's rise to a respectable engineering powerhouse? Any of you guys remeber when "Made in Japan" meant it would break in 10 minutes of use?
There's a natural cycle seem to countries go through when they finally get their act together in engineering:
- Growth from low-cost outsourcing
- Growth due to home-grown businesses exporting good IP
- Imposition of copyright and patent protection
- Growth due home-grown businesses selling IP locally, and the death of outsourcing
I think in 1980's, an Indian programmer cost about $2K/year. Now that the outsourcing companies have run out of good local talent in places like Bangalore, salaries are rising to the point that it makes less sense to outsource engineering and programming to India. Countries like Romania look better.
To continue growth, innovators in India will need to create their own businesses to compete with Silicon Valley startups. To some extent, they seem to be started at this. For example, the customer-relationship software I'm using at the moment, VtigerCRM, is a shameless copy of opensource software from SugarCRM, and it's shamelessly copying Salesforce.com functionality. Indian investors are funding the Vtiger opensource alternative, betting they can beat SugarCRM and Salesforce.com at their own game. Maybe they're right.
However, the exported software market is only so big. As programmers in India tire of making money from foreign countries where software is actually worth something, they'll force their government to crack down on IP theft. This will create a local market for programmers, greatly fueling high-tech business growth. It also will mostly kill their outsourcing business, since salaries will then be able to rise above the threshold where outsourcing to India makes sense.
I hope for a similar cycle to be followed in China. When China and India are done with the outsourcing business, we can move to other countries that need to come forward into the new millenium. Outsourcing our jobs is massively painful, but at least we're helping make the world a better place.
Beer is proof that God loves us, and wants us to be happy.
How long will it be until you hear Indian comedians complaining about calling tech support only to have some stupid American speaking gibberish to them over the phone?
This is a surprise - I am actually in the program discussed in the article. I just graduated from the University of Washington in Seattle, and took this job. I'm typing this from the company's campus in Mysore, India. It's a fun experience, I'm seeing the sights, eating a lot of curry, getting my technical skills rounded out a bit, and then I will be headed back to the States in while to work for them.
If anyone has any questions about the article, wtf I'm doing in India, what it's like, etc... post here and I will do my best to answer them!
no thanks
"The cost of living in India would be lower than the home country + comparable wages = ability to save."
Westerners who have lived in developing countries know this is not entirely true.
If you're an "average" local living in average conditions, your cost of living will be lower than an "average" person in North America, but if you want to live at western standards (house in a nice neighbourhood, car, big TV, stereo, washer dryer etc.) then expect to pay the same or more for the products/services you want. In a developing country, public transport may not even be an option; a car could be an absolute necessity, and therefore an unavoidable expense. To live at western standards you probably won't see many savings in your expenses over actually being in the west.
On the other side of the coin, you could probably afford such luxuries as a live-in housekeeper.
Depending on where you live, there may be savings from low or non-existent income taxes. You could come out a bit ahead from this.
However, in some countries (those in the Gulf region, for example), foreigners are not allowed to buy property. Rent for a nice villa or apartment is as high or higher than what you would pay in Europe/N-Am. If you're paying a mortgage, at least your expenses are adding to your equity, but when you pay rent, that money is gone. This rent is like a defacto tax on foreigners because it is unavoidable, but instead of the money going to the government, it goes directly to the local who owns the property you live in.
If you have children, expect to pay for them to go to school.
Healthcare, especially healthcare which is to western standards, is another expense to keep in mind.
Taking part in leisure activities means more expenses; public recreation facilities which are normal in the west aren't normal in developing countries. Private clubs provide sports facilities, clean beaches etc. etc.
By living in a developing country, a western professional will probably enjoy a nice lifestyle, but to do so means that savings likely won't be much greater than they would be in the west. Obviously, one can do without many of these expenses, live more like the average locals do and save money, but one can also save money in the west by living a much simpler lifestyle. Many people who work overseas do so for the experience.
RTFM; please, I beg you.
You might want to say "greedy in the aggregate".
10 very nice people may invest in your company. If they can do better somewhere else, half of them may very nicely decide to invest somewhere else, which is a perfectly reasonable thing for them to do, after all. (Everybody is all about how other people should make economically-poor decisions for the "greater good", a.k.a., "my benefit", but very few people really step up to the plate and deliberately select underperforming options when they have the choice. Non-zero, but few.)
In the aggregate, these otherwise nice people look incredibly greedy to the company they had the investment in, and the company feels incredible pressure to do better, in a way far out of proportion to the exertion of the investors.
Greed isn't an entirely inaccurate description of the results, but it may not describe motives; I have a hard time calling "investing in a 5% return instead of a 2% return" 'greed'. That's more like 'sensible', not 'greedy', and the opposite 'stupid'. (All else being equal of course, I'm ignoring the risk factors.) Besides, given that the economy isn't a zero-sum game (bolded because more people need to actually realize and internalize that) and that 2% vs 5% difference may very well be real if you're investing in a capital-producing company, it's not even necessarily a good decision for society to take the 2% either. That's the magic of capitalism and the market, to harness "greed" for the greater good of society.
I recently outsourced myself to Costa Rica and am enjoying it. Unlike the people in the article who work for companies in India, I do not work for any companies here in Costa Rica. The pay would be lousy. Instead I do the same software development work I did in California.
Here is link to a writeup I wrote recently on the experience:Outsourcing Myself to Costa Rica
This isn't reverse off-shoring, this is Westerners moving to India for Jobs that have been offshored from the places they come from.
In a real example of reverse off-shoring, I was contacted a few months ago by someone from an Indian consulting company that needed someone to do some development work for them who was "closer to the customer" (in this case closer to their customer in the US - I'm in the US). I basked in the irony for a while and then decided against it.