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Utility Sets IT Department On Path To Self-destruction
dcblogs writes "Northeast Utilities has told IT employees that it is considering outsourcing IT work to India-based offshore firms, putting as many as 400 IT jobs at risk. The company is saying a final decision has not been made. But Conn. State Rep. and House Majority Leader Joe Aresimowicz, who is trying to prevent or limit the outsourcing move, says it may be a done deal. NU may be prompting its best IT employees to head to the exits. It also creates IT security risks from upset workers. The heads-up to employees in advance of a firm plan is 'kind of mind mindbogglingly stupid,' said David Lewis, who heads a Connecticut-based human resources consulting firm OperationsInc, especially 'since this is IT of all places.' The utility's move makes sense, however, if is it trying to encourage attrition to reduce severance costs."
Because it's worked so well for others in the past.
Just finishing my last trojans and timebombs...now they can fire me.
Publicly traded utilities should be prohibited from hiring foreign companies to perform these kinds of jobs, in much the same way those companies are also prohibited from hiring foreign attorneys, architects, construction companies, doctors and certified accountants.
Almost all utilities are regulated industries, since they enjoy government-enforced monopolies. They should not be allowed to leverage taxpayer-subsidized market exclusivity in order to engineer the destruction of those same taxpayer's careers.
This applies equally to cable television providers, ISPs, gas and water companies.
It just doesn't work.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
As an IT professional, what angers me is mostly management lying and claiming everything's hunky-dory and then blindsiding me with layoffs. When they do it even once, it convinces me that I can't trust them ever again. That's not a problem if I'm one of the ones being shown the door, but companies rarely lay off everybody in a single pass and this creates if anything even worse trust issues with those who're still working. At the very least this behavior will turn me from someone who considers it only professional to give as much notice as possible if I decide to go elsewhere into someone who a) doesn't feel obligated to give any more notice than legally required since the company's shown that's what they'll do and b) is more likely to start looking before he gets caught in the next round of layoffs. Whereas if the heads-up is given, I'm less likely to worry and be looking to jump ship because I know I'll have advance warning next round too.
That no-advance-warning is only a good idea if you can't trust your IT people in the first place. And if you can't trust them, why are you trusting them to run your IT department?
Why would you outsource like this? It would mean:
1) Different timezones - cannot communicate in realtime;
2) Different culture - harder to understand requirements;
3) Language barrier - even in the unlikely event that the developers all speak excellent Indian English, it is *not* the same as Americna English;
4) Lack of face-to-face contact - being able to watch someone communicate, point at the screen, sit in a room together makes for far faster problem resolution;
5) Lack of mutual value - a permanent employee is entirely your investment, and in return works and trains only on your systems, dedicating their work day to understanding what you need, and spending years at your company becoming intimately familiar with your processes;
6) Lack of open-ended requirements - this is one of the most important things of all: all contractors bit you in the ass by working to spec, whereas permanent employees will be there to do whatever you want, when you want it.
In short, paper estimates of monies saved by outsourcing are always - without exception - a crock of shit. Someone wants a hefty bonus, possibly by fooling executives re apparent saving, or possibly because they have an interest in the outsourcing firm. Most likely both.
I would have thought every IT professional with a pulse would now know that outsourcing development or support always ends in a gigantic cluster fuck.
Note that due to the various interlockings of the various utilities operated by Northeast Utilities, it is next to impossible to know how much people like Bill Quinlan are pulling out of the company, but according to one report, the executives at CL&P (connecuit light & power) get paid 11.2 million. Replacing 400 IT jobs with a contract to India will probably save less than the executive salaries, it is good to be at the top in a modern american company. Bill is a freaking attorney, pulling out about $4 million per year from the rate payers for making such hard nosed decisions as putting 400 americans out of work. Nice guy!
Hardware from China and software from India.
MBA's from the US
Judges from Italy
Maple Syrup from Canada
and
Putin from Russia to oversee the project on horseback.
It's a small world, after all....
Faster! Faster! Faster would be better!
Seeing as how vital utilities are to our Nation's livelihood and welfare, I can't possibly see any scenario in which outsourcing the IT duties to any Foreign National should be considered anything but a gigantic security risk. It's no secret that any given network on the electric grid can cause widespread outages beyond it's customer base. Congress needs to pass a law requiring all Utilities to employ their own IT departments comprised of US Nationals on US Soil.
Why did this part only make it to page 3?
Of course it does. IMHO, IT shouldn't be outside of a secure environment's walls. Even with "good" IT people, when they can VPN in from home computers and do things, it can compromise the security of the network. When your entire shop is off-shore, there's no one standing guard to make sure things are safe.
The risks are huge. It can range from malware on a workstation, to malicious actions by a 3rd party or employee.
The "what could possibly go wrong" goes from the confines of their office, to ... well ... the whole world.
I'm surprised DHS hasn't said no to this. They're worried about critical infrastructure, including power utilities, being compromised by outside attackers. When all the work is being done by someone other than in-house staff, it's inviting exactly that kind of trouble.
I guess "best case" here is that they're trying to get a bunch of people to quit, so they can get fresh locals in for less pay, screwing the existing staff in the process.
Serious? Seriousness is well above my pay grade.
There really is a reason why companies make the announcement ahead of time before outsourcing. Really, there is. It's part of the formula. The outsourcing company sells the patsy... client, sorry. Sells the client on the idea that the client tells their employees that they're planning to outsource, so that the employees can then be directed to spend their remaining time in documenting their jobs well enough that an untrained person in a third world country could do the job.
The outsourcing company will insist on this, and the sap, ur... client for God only knows what reason will think this will actually work, and the employees will go "sure, yeah, that's what I'm doing with my remaining time here. Sure. Not spending my entire shift looking for a job in a down economy. No sirree. My job doesn't take any original thought, creativity, or diagnostic skills, it's just a lot of button pushing and answering questions. Here, let me print out ... say ... everything in My Documents. That should stack up real nice."
Five years later, the outsourcing company will assure the chump... what's wrong with this spell checker? CLIENT. The client, that the break-even point is just around the corner, really it is, and will volunteer to help sell this concept to the board. Meanwhile, the victim's argh... client's business has suffered, it's harder to do even the smallest office task, change in any reasonable amount of time is impossible, and employees are saying things like "for God's sake, please don't make me call the helpdesk".
And this will be called Progress.
Oliver's law of assumed responsibility: If you're seen fixing it, you will be blamed for breaking it.
"IT is not a revenue generator."
Wrong. IT very much *IS* a revenue generator. It's just not an obvious revenue generator.
Most modern businesses of any size cannot operate long without some form of IT. And if their business does not operate, there is no revenue. Strictly speaking, the only thing that "generates" revenue is sales. Depending on your point of view at any given moment, EVERYTHING else in the company could justifiably be labeled as an unnecessary expense. Including the CEO's paycheck.
I've seen this often before. They're cutting their own throats. They may not know it, because what IT does not show up on the books as a positive, but that's what they're doing.
To a Southerner, Briton, Jamaican or Australian they definitely have an accent. It's impossible to speak without an accent. You're confusing "no accent" with the General American accent. It's considered as neutral of an American accent as you can have, and is widely used in broadcasting. It is, nevertheless, an accent.
>>Hardware from China and software from India.
>MBA's from the US
>Judges from Italy
>Maple Syrup from Canada
CHANTING CHORUS: Oil from Canada! Gold from Mexico! Geese from their neighbor's back yard! Boom, boom! Corn from the Indians! Tobacco from the Indians! Dakota from the Indians! New Jersey from the Indians! New Hampshire from the Indians! New England from the Indians! New Delhi from the Indians! ... ... ... ...
BABE: Indonesia for the Indonesians!
SOUND: Cannon shot.
JOE: Yes, and Veteran's Day
DC: But we couldn't do it alone!
SOUND: Morse Code sending under.
JOE: No! We needed the Hope, the Faith, the Prayers, the Fears
DC: The Sweat, the Pain, the Boils, the Tears!
JOE: The Broken Bones!
DC: The Broken Homes!
JOE: The Total Degradation of
BABE: Who?
EDDIE: You! The Little Guy!
--
BMO
LURLENE: Where are you from?
BABE: Nairobi, Ma'm. Isn't everybody?
Hostess didn't come back, they liquidated.
All of the rivals of Hostess that didn't go bankrupt are the ones ressurecting the brands that were put in limbo by their failure.
IT talent in New England still have to pay New England rent prices and still have some money left over for food.
A Pirate and a Puritan look the same on a balance sheet.
You're a fool. IT is infrastructure and an insurance policy when/if something goes wrong. IT does not produce anything, they do not sell anything, IT has no product for which a customer will pay. That in the eyes of an exec is a drain on the company and therefore will always be the first to get cut when they need a new yacht.
Keep deluding yourself that IT is a revenue generator. Try pitching that to the VP of IS/IT while he stares at the spreadsheet showing the hundreds of thousands of dollars you requested that quarter to upgrade XYZ.
Don't be so quick to dismiss outsourcing as an option. IMO, its a great idea... but they're doing it all wrong. Domestic, in-house IT has been commoditized, and a reasonable, rational ceiling has been established for all positions. The money spent there is not waste, and not outrageous. Looking in that space to cut jobs to save money won't work. Its the same as saying "those cafeteria workers are sucking up all our profits... let's outsource!" I can't believe anybody actually believes the bull that flows from the top. But if they'd outsource every single executive and upper-management position, including boards of directors, they'd not only save so much money that their stock would skyrocket, pleasing investors, they'd have better educated, more ethical individuals working for far more reasonable salaries doing a much better job driving the company to bigger success in the short and long term. The shareholders need to stand up and demand that they outsource the suits and PHBs, if they have any sense.
The Admin and the Engineer
Here are the problems outsourcing to India in particular incurs, as those of us who have seen it done again and again since the early 90s know:
1. data *will* be stolen and sold for spamming and marketing and data mining
2. no way to ascertain true credentials or abilities of any person, paper diploma/cert mills are rampant
3. no real legal venue for theft, non-performance, copyright and patent violation, shoddy product or workmanship
4. any disputes will immediately trigger the cultural response of obstructionism, picayune arbitration, and malicious compliance
5. supposed "experts" regurgitate "white paper" knowledge but have no experience or ability in practical application
6. if any project gets done at all, it will be at three times the projected duration with two times the people.
In short, those who outsource to India deserve what they get. And what they will get is expensive failure.