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Study Finds Cost Major Factor In Outsourcing Positions
theodp writes "Debunking claims to the contrary, a new study from Duke University asserts that it is purely cost savings, and not the education of Indian and Chinese workers, or a shortage of American engineers that has caused offshore outsourcing. 'The key advantage of hiring Chinese entry-level engineers was cost savings, whereas a few respondents cited strong education or training and a willingness to work long hours. Similarly, cost savings were cited as a major advantage of hiring Indian entry-level engineers, whereas other advantages were technical knowledge, English language skills, strong education or training, ability to learn quickly, and a strong work ethic.' The article goes on to point out that despite this, outsourcing will continue to be a problem for US workers in coming decades; new elements of traditional corporations like R&D may in fact be next on the outsourcing chopping block."
Those who work, learn how things work. Bad news for Americans who won't lower their salary to compete.
Thats a problem with the winner of a job position. Not only did they beat you getting the job but now they're going to get more experience then you now having the job.
I like to call this the cascading winner effect.
Counter strike makes a perfect example. The winners of each match get more money and thus can buy better equipment ( better rifles, grenades etc.) Thus the losers lose even more. As far as I can tell, the best way out if you're a loser is to not have children. Phase yourself out if you're a loser, teams are going to be stacked against your kids.
"Outsourcing R&D is a horrible idea."
Any kind of outsourcing is a horrible idea. Look at the web sites of any online bank. They are stupid, stupid, and purposely stupid. After people in India learn how to write good banking software, magically some company owned by an Indian will have the best banking software.
There is only one reason for outsourcing. Non-technical managers want the technical responsibility as far away from themselves as possible. It is dishonesty only.
Walk down any street in India and ask yourself: Why are people in India so poor? They are poor because their culture is extremely self-defeating. No matter how well an Indian who is first- or second-generation educated is trained technically, he is still guided mostly by his culture.
The claimed cost savings are not there. They simply are not there. The "cost savings" come from situations like this:
1) It is cheaper to hire Indians for a sloppy, poorly defined project than it is to hire people in the U.S. for a sloppy, poorly defined project, and the result is the same.
2) Many top managers today are like kings. They have complete control, can be as destructive as they want to their company and to other people, and are very ignorant. So when it comes time for a technical improvement that will be a lot of work, and require a lot of responsibility and decision-making, moving the entire project 10,000 miles away seems attractive. The distance offers lots of excuses, and it just doesn't matter to the king how much money is wasted. The "cost savings" are what the king says they are.
We are going through a time in which most managers of technically-oriented companies know nothing about technical issues, and don't want to know anything.
Business magazines are part of the fraud. They assign writers who don't have any technical knowledge and give them 1/10th the time necessary to do a good job. The writer's only desire is not to seem too stupid, so he or she looks at other articles and imitates their ignorant imaginings.
Only one kind of manager can manage technical efforts: Someone who is extremely knowledgeable technically and is, at the same time, an excellent manager, and has a strong, insightful relationship with his group. Such people are rare.
In future decades, people will laugh at the efforts of today. Remember, Time-Warner bought AOL and immediately lost 88 Billion dollars. Remember the press conference when the "mouth of the south" Ted Turner said the deal was "better than sex"? Everyone at that press conference was a multi-millionaire who simply didn't care, and everyone at that press conference was so ignorant, there is no word in the dictionary that expresses the full profundity of their ignorance. You have to call them "iggerunt".