Meanwhile, laws make it harder and harder to get rid of employees without risking legal action, so the employees you are paying more for go down in quality, because there's less incentive to be productive and/or compete. Our communist friends took this to its logical conclusion but apparently could never see that its failure was inevitable.
So did our Scandanavian friends and... Oh, wait! their GDP per capita is higher than America's...
Hmmmmm....
<scratches chin> Maybe there is more to this "economics" thing than I thought...
No government should have a right to tell my boss what he must pay me or not pay me...
So yeah, scrap the law, get rid of all of these types of laws. Get the government out!
Yeah! Let's have children cleaning chimneys again! Gee, if those little tykes didn't want to do it, they'd have got a job else where, right?
:-P
I'm only part joking. To say the government has no role in employment law is to ignore how far we have come in humanitarian treatment of employees and invites regression.
<ducks>
(Though, of course, I am not saying that an overweening goverment is good either...)
"Many are extremely introverted and have trouble speaking up among their peers; they simply would not be capable of dressing down an employee who desperately needs it."
"You apparently are having very a hard time distinguishing introversion from a mental disorder, and seem to either be afraid of introverts, have a distate for them, or simply make no effort to understand them."
Gee, you must be awfully clever to conclude all of that from just a few paragraphs. I wish I possessed your perspicacity.
"My suggestion to you is to quit whining "stereotype, stereotype" just because someone recognized a cause and effect relationship that happens to involve people."
And my suggestion to you is that you study why "correlation" does not necessarily infer "cause and effect".
How many terrorism related deaths have there been in the US since 9/11.
Now, does that number match what you would have perceived on 9/12?
There were no more attacks on American soil to my knowledge after Pearl Harbour (except a few agitprop shells on Oregon) but that does not mean America was not at war. Nor did it mean things were going well.
Can we please get away from the stereotype of programmers being more unorganised/uncommunicative/introverted than other people?
Sure, some are. But I've known some managers who were too. (The reason such people climbed the corporate greasy pole was they had a reasonable degree of sociopathy).
Saying that programmers are schizoids is like saying executives are dumb, greedy crooks. Sure, some are, but the majority are not.
Most programmers I know are urbane, intellectual and have bags of common sense.
I'm amazed that we still tolerate programmer stereotypes when it is illegal in the work place to make derogatory comments on other peoples' racial/sexual/religious persuasions.
But, if it's any consolation, I think the whole offshoring thing is slowly being recognised for the fad it is (like "downsizing" in the early 90s).
It's still taking longer for the pernicious management fad of outsourcing ("displace rather than decrease the risk/blame") to disappear, however.
BTW, I have a similar resume to you and have worked on one (and only one!) system that was what I would consider a success. I still think this is one more than most people!
In the UK "everything costs 10 times as much, it rains all the time, the roads are always blocked, the trains never run on time, you can't get a drink after 11pm or before 10 am, there's 70 million people crammed onto an island a third the size of Ohio, and the NHS offers the worst service and the filthiest hospitals in the developed world."
If you don't like it, move to any of the other 14 countries in the EU you have the right to live in.
I just started working at a company where user Web sessions in Orion were reaching 1 MB each.
Further investigation revealed that the code sucked. It was nothing to do with Java. A re-write brought the Web sessions down to about 100 bytes each. It is now a happy app.
Moral of the story: there is good code and bad code in any language.
(Having said that, the JVM does take an awfully long time to bootstrap...)
We LOVE CODING too much to do that, so personally we're gonna keep doin what we love and selling it. Helping people with our products has never been fun anyway!
I'm a coder. I love coding. I've been doing it for years.
I also love free software and I don't see it as a threat to my livelihood. On the contrary, I think it will provide me with secure employment.
Why? Because free, OSS software is useless by itself.
JBoss is free. Tomcat is free. MySQL is free. But they are all worthless to my company until I write code that uses them. These little babies have been making me a good living for the last few years!
I think OSS will accelerate the movement from software engineering being considered a manufacturing process to being accepted as a service. And I welcome that move.
while writing code requires a specific technical skill sets, it is by its very nature a strong candidate for outsourcing because:
Labor costs are a signiicant percentage of the production cost
The skills can be found in lower costs areas of production
And you are telling me that the same cannot be said for management? (BTW, please spare me the crypto-racist argument that "Indians can't do management").
OSS... does point out the fungability of coding
I assume you mean "fungibility" rather than "fungability" and I'm not quite sure what you mean. An OSS project often has a very dedicated team working on it rather than transient labourers.
features not yet implemented but desired by end users
projects that die from lack of interest
multiple interpretations of the same idea
The same can be said for management-heavy software. The only difference between OSS and management-heavy software is that OSS tends to be slightly better, IMHO.
the challenge is to seperate the coding skills from the otehr ones so you can lower teh total development cost
You only replace expensive coders with expensive requirements gathering people plus Third World coders. And you greatly increase the chance of miscommunication since natural language is inherently ambiguous. The only unambiguous document produced is the code itself.
If your project requires, say, 30 coders and a Waterfall Methodology is acceptable, fine, go ahead and offshore. But it's generally accepted that smaller teams of coders are better than larger and a more Agile methodology best suits today's business needs. For these reasons, my company has decided to cut costs by not offshoring.
I think your desire to offshore no matter what the cost to the business is dogmatic but I have enjoyed this exchange!
Forget the many economist that make arguments like this one, stating that outsourcing will ultimately benefit consumers...
Forget government data that downplays the significance of offshore work...
Forget the fact that companies like Microsoft sell millions of dollars worth of software to foreign countries around the world...
Forget the fact that the trade deficit is half a trillion dollars a year (5% of GDP)...
Forget that fact that America is increasingly becoming a PowerPoint nation where all the workforce do is make slides all day long...
Forget the fact that it's current boom is financed by the largest consumer debt (in both absolute terms and as a percentage of GDP) that the World has ever seen....
And just jump to the conclusion that these wimpy liberals are complaining about nothing.
"Which is why expensive managemnet will be kept onsite and the grunt work offshored"
Coding is grunt work? Are you joking? That kind of contempt for the code (ie, that which serves the customer) is what leads to
75% of IT projects failing.
The code is way more important than the management. You only have to look at the open source community (entire number of managers: 0) to see how great coders don't need managers to make great software.
I agree with what you say about other professions being the next outsourcing targets, though.
If all you are doing is writing code to spec, it's immaterial if your doing it onsite or in Bangalore or Kiev.
Totally. But so few projects these days require the coder to just code.
The real racism is the fact that it is so called "low-level" work like programming that is offshored to these countries.
Why don't we offshore more managerial work to India and China? Managers cost a small fortune and are easy to offshore. I mean, if expensive managers can live in the West and offshore programming to Asia, why can't the cheap managers in Asia manage programmers in the West?
For projects with about 5 or less programmers, the managerial costs are larger than the costs spent on employing coders.
I asked an American MBA friend of mine why we don't do this and was given the crypto-racist answer that "Indians can't do management".
I don't buy your racial theories that Asians are somehow more intellectual than Westerners based on the GRE survey you quote. There are other factors at work here. Those coming to the West for their education are not representative of the billions of people at home anymore than the Americans in Iraq are representative of the US population as a whole.
What you say is comparable to an Iraqi concluding that all Americans carry machine guns and wear body armour because all the Americans he sees carry machine guns and wear body armour.
Chinese and Indian nationals coming to the West for their education are generally going to be the academic best of their nations. You cannot take the top percentage from a nation and say that it is representative of that entire nation. That's just silly.
Statistically speaking, the quality of Indian programmers should be worse than their Western couterparts.
Why?
Because an awful lot of people are jumping on the coding bandwagon over there - even if they don't have the acumen.
And good luck to them, I say.
But in the West, nobody goes into programming for the money. There is no bandwagon on which to jump. So, you can pretty much guarantee that programmers entering the profession over here and doing it for the love not the money. These people are obviously going to be more committed than people who spot a way to make a quick buck.
"If outsourcing helps to spread the wealth, stabilise the rest of the world and narrow the gap between rich and poor then let's do it."
Let's get one thing straight. Our politicians and business leaders don't give a rats ass about making the rest of the World richer.
And if you really care about poor people in the rest of the Third World, lobby your leaders to open your agricultural markets to them.
Three quarters of India's economy is agrarian, only one per cent is IT related. It would be considerably better for everyone (more money for them, cheaper products for us) if we opened our agricultural markets.
Instead, we have self-interested farming groups telling us it's actually in our national interests to keep our markets closed. (As if some foreign national writing our software is just fine and dandy for security...)
While I agree with you that the threat of outsourcing has been overstated (with the overhead of more management, outsourcing often increases costs), I don't agree that protectionism is always bad.
Malaysia introduced protectionism after the Asian crisis and has done considerably better than its neighbour, Indonesia, which embraced the IMF's dictates to open their markets.
"what better way than to take protectionist measures that will instantly invite retaliation?"
America can afford to have little/no protectionism. It is a huge trading bloc and has the most powerful military in the World. When it comes to contentious issues, it's pretty hard for small and/or poor countries to argue with them. Unless there is a balance of power in negotiations, don't expect these countries to drop their protectionist policies.
I can hire inexpensive lawyers offshore to research, answer questions, prepare briefs under the lead of a local attorney.
You can but whether you should is moot. You forget about the management overhead in co-ordinating these people. Ever tried to manage somebody in another country? It's not easy. Unless there are dozens of people on the team, it is more cost-effective to have them on-site. Remember: management is the most expensive resource on an IT project. If you offshore your programmers but need to increase your management, you are not likely to make savings (unless the number of programmers you offshore is huge - see my previous post).
On-site teams are also far more effective. Architectural principles are the same the World over. But who would seriously consider building a house with their architect in - say - South Africa?
Look at Siemens and what tehy are doing with telecommunications.
Can you be more specific?
I'm a consultant - I convert gibberish into cash-flow.
Good for you! Most consultants I know convert cash-flow into gibberish!
If your selling support, It'll be cheaper to hire a bunch of cheap offshore techies to answer phones and provide support....
Just don't plan on being a high paid US programmer when equally good talent is cheaper elsewhere.
Nope! Just because the software is free does not mean you don't need on-site programmers. On the contrary, they become more important.
Take this as example:
Laws are free to use. Buying a book on law is almost free ($50 max). But there is no chance that lawyers (practitioners of law) will go out of business.
Similarly, software may be free but that does not mean we don't need programmers (practitioners of software engineering). Somebody has to add value to that free software to give the company a competitive advantage.
Whatsmore, here in England, thanks to out colonial heritage, we have lots of lawyers elsewhere in the World who can practise English law. But who offshores their lawyers to - for example - the Bahamas? (The Bahamas has as its highest court of appeal, the English Privy Council). Sure, Bahaman lawyers are cheaper but it's much more cost effective to employ somebody who is sitting next to you.
That's the direction software engineering is going in the more developed countries, I believe. For any team of programmers less than about 10, it is more expensive to offshore due to the additional management overhead.
Software is manufacturing? I always thought I was in the service sector.
I mean a lawyer doesn't manufacture contracts, does he? He provides a service.
Similarly, I provide a service by writing code (which is a contract with the computer).
We don't (directly) pay for laws. They are made by our governments. Sometimes, they are even made by lawyers working pro bono (ie, free). Laws also are modified over time (maintenance).
These are direct parallels to programming. So, why do people say coding is manufacturing but law is a service?
And do lawyers complain that somebody else making laws that they use reduces their jobs to a support role?
(BTW, do people say that lawyers working pro bono are destroying jobs?)
I absolutely agree because something similar is happening to me at the moment.
We hired some chimps from a huge international consultancy. The document they produced is so piss-poor we are on our sixth draft. In the time this has taken (2 months) with two very expensive consultants working full time and two in-house developers checking their work part-time, we have
spent a fortune,
do not have a document that's of sufficent quality to give the outsource providor
and not got a single line of code written.
The threat of offshoring has been massively over stated. More and more companies are seeing that this process (send the requirement to India) is simply not cost-effective. It may take some time for all PHBs to see this but it will happen. That's business.
There is (hopefully) a happy ending. The outsource providers tendering for this gig are charging in the region of 700UKP/day (about $1200/day) for a Java programmer with about 3 years experience (I'm not making this up). Most say that they can cut that cost by about a third if we offshored. Well, gee, that's still more expensive than hiring some local contractor with 7 years experience who can sit down and talk to the business people. We're getting "buy-in" from management to save money and not offshore. We'll have a decision soon and it looks good.
Agile methodologies will be the saviour of the Western programmer.
- Because, typically, CEOs sit on the remuneration committee of the execs (or their friends) who sit on his.
- Because the marketing and management bods know that supply and demand curves aren't as the text book shows them (see the myth of the "perfect market" that Munger talks about).
- Because managers earn, say 30% more than their immediate subbordinates. And 30% more than a guy in India doesn't sound appealing. Ergo, there is a human factor that defies economics.
- We don't need expensive people who capture requirements.
- We don't need expensive managers to oversee our relationships with the offshored team.
- We can turn on a dime as the market changes.
Bottom line: outsourcing is expensive!
A salesman in a shiny suit came to talk to us about offshoring. The total costs (when you consider the fees he and his chums were charging) were higher than using on-shore programmers.
This is why all the jobs won't go abroad. Just those that were trivial.
I have a couple of friends in investment banks that tell me offshore work is coming back to the UK and that the managers now considered sending it half way around the World an expensive mistake.
You guys in America are stuffed in the short-term, though, 'cos your bosses love management trends (anybody remember downsizing in the early 90s...?). Management in Europe is more circumspect about jumping on the latest band-wagon.
Slashdot Mirror
So did our Scandanavian friends and... Oh, wait! their GDP per capita is higher than America's...
Hmmmmm.... <scratches chin> Maybe there is more to this "economics" thing than I thought...
Yeah! Let's have children cleaning chimneys again! Gee, if those little tykes didn't want to do it, they'd have got a job else where, right?
I'm only part joking. To say the government has no role in employment law is to ignore how far we have come in humanitarian treatment of employees and invites regression.
<ducks>
(Though, of course, I am not saying that an overweening goverment is good either...)
No, you said:
"Many are extremely introverted and have trouble speaking up among their peers; they simply would not be capable of dressing down an employee who desperately needs it."
Compare and contrast with:
Schizoid personality disorder (SPD) is a personality disorder characterised by a detachment from social interactions and a tendency towards a solitary lifestyle. SPD is characterised by ... indifference to either praise or criticism.
"You apparently are having very a hard time distinguishing introversion from a mental disorder, and seem to either be afraid of introverts, have a distate for them, or simply make no effort to understand them."
Gee, you must be awfully clever to conclude all of that from just a few paragraphs. I wish I possessed your perspicacity.
"My suggestion to you is to quit whining "stereotype, stereotype" just because someone recognized a cause and effect relationship that happens to involve people."
And my suggestion to you is that you study why "correlation" does not necessarily infer "cause and effect".
The Bush regime also gave $43 million to the Taliban just a few months before 9/11 (see CNN) with the full knowledge they were harbouring bin Laden.
Gee, so according to your argument, I guess that means Bush had links to al Qaeda...
Links, please, and facts in context, too...
Now, does that number match what you would have perceived on 9/12?
There were no more attacks on American soil to my knowledge after Pearl Harbour (except a few agitprop shells on Oregon) but that does not mean America was not at war. Nor did it mean things were going well.
Sure, some are. But I've known some managers who were too. (The reason such people climbed the corporate greasy pole was they had a reasonable degree of sociopathy).
Saying that programmers are schizoids is like saying executives are dumb, greedy crooks. Sure, some are, but the majority are not.
Most programmers I know are urbane, intellectual and have bags of common sense.
I'm amazed that we still tolerate programmer stereotypes when it is illegal in the work place to make derogatory comments on other peoples' racial/sexual/religious persuasions.
But, if it's any consolation, I think the whole offshoring thing is slowly being recognised for the fad it is (like "downsizing" in the early 90s).
It's still taking longer for the pernicious management fad of outsourcing ("displace rather than decrease the risk/blame") to disappear, however.
BTW, I have a similar resume to you and have worked on one (and only one!) system that was what I would consider a success. I still think this is one more than most people!
Edinburgh is one of the best cities in the World...
If you don't like it, move to any of the other 14 countries in the EU you have the right to live in.
Further investigation revealed that the code sucked. It was nothing to do with Java. A re-write brought the Web sessions down to about 100 bytes each. It is now a happy app.
Moral of the story: there is good code and bad code in any language.
(Having said that, the JVM does take an awfully long time to bootstrap...)
I'm a coder. I love coding. I've been doing it for years.
I also love free software and I don't see it as a threat to my livelihood. On the contrary, I think it will provide me with secure employment.
Why? Because free, OSS software is useless by itself.
JBoss is free. Tomcat is free. MySQL is free. But they are all worthless to my company until I write code that uses them. These little babies have been making me a good living for the last few years!
I think OSS will accelerate the movement from software engineering being considered a manufacturing process to being accepted as a service. And I welcome that move.
Doesn't the fact that implementation really is often screwed up not make you think that perhaps it is just a little harder than you imagine?
Labor costs are a signiicant percentage of the production cost
The skills can be found in lower costs areas of production
And you are telling me that the same cannot be said for management? (BTW, please spare me the crypto-racist argument that "Indians can't do management").
OSS ... does point out the fungability of coding
I assume you mean "fungibility" rather than "fungability" and I'm not quite sure what you mean. An OSS project often has a very dedicated team working on it rather than transient labourers.
features not yet implemented but desired by end users
projects that die from lack of interest
multiple interpretations of the same idea
The same can be said for management-heavy software. The only difference between OSS and management-heavy software is that OSS tends to be slightly better, IMHO.
the challenge is to seperate the coding skills from the otehr ones so you can lower teh total development cost
You only replace expensive coders with expensive requirements gathering people plus Third World coders. And you greatly increase the chance of miscommunication since natural language is inherently ambiguous. The only unambiguous document produced is the code itself.
If your project requires, say, 30 coders and a Waterfall Methodology is acceptable, fine, go ahead and offshore. But it's generally accepted that smaller teams of coders are better than larger and a more Agile methodology best suits today's business needs. For these reasons, my company has decided to cut costs by not offshoring.
I think your desire to offshore no matter what the cost to the business is dogmatic but I have enjoyed this exchange!
Forget government data that downplays the significance of offshore work...
Forget the fact that companies like Microsoft sell millions of dollars worth of software to foreign countries around the world...
Forget the fact that the trade deficit is half a trillion dollars a year (5% of GDP)...
Forget that fact that America is increasingly becoming a PowerPoint nation where all the workforce do is make slides all day long...
Forget the fact that it's current boom is financed by the largest consumer debt (in both absolute terms and as a percentage of GDP) that the World has ever seen....
And just jump to the conclusion that these wimpy liberals are complaining about nothing.
"Which is why expensive managemnet will be kept onsite and the grunt work offshored"
Coding is grunt work? Are you joking? That kind of contempt for the code (ie, that which serves the customer) is what leads to 75% of IT projects failing.
The code is way more important than the management. You only have to look at the open source community (entire number of managers: 0) to see how great coders don't need managers to make great software.
I agree with what you say about other professions being the next outsourcing targets, though.
If all you are doing is writing code to spec, it's immaterial if your doing it onsite or in Bangalore or Kiev.
Totally. But so few projects these days require the coder to just code.
Why don't we offshore more managerial work to India and China? Managers cost a small fortune and are easy to offshore. I mean, if expensive managers can live in the West and offshore programming to Asia, why can't the cheap managers in Asia manage programmers in the West?
For projects with about 5 or less programmers, the managerial costs are larger than the costs spent on employing coders.
I asked an American MBA friend of mine why we don't do this and was given the crypto-racist answer that "Indians can't do management".
What you say is comparable to an Iraqi concluding that all Americans carry machine guns and wear body armour because all the Americans he sees carry machine guns and wear body armour.
Chinese and Indian nationals coming to the West for their education are generally going to be the academic best of their nations. You cannot take the top percentage from a nation and say that it is representative of that entire nation. That's just silly.
Statistically speaking, the quality of Indian programmers should be worse than their Western couterparts.
Why?
Because an awful lot of people are jumping on the coding bandwagon over there - even if they don't have the acumen.
And good luck to them, I say.
But in the West, nobody goes into programming for the money. There is no bandwagon on which to jump. So, you can pretty much guarantee that programmers entering the profession over here and doing it for the love not the money. These people are obviously going to be more committed than people who spot a way to make a quick buck.
That's business.
"If outsourcing helps to spread the wealth, stabilise the rest of the world and narrow the gap between rich and poor then let's do it."
Let's get one thing straight. Our politicians and business leaders don't give a rats ass about making the rest of the World richer.
And if you really care about poor people in the rest of the Third World, lobby your leaders to open your agricultural markets to them.
Three quarters of India's economy is agrarian, only one per cent is IT related. It would be considerably better for everyone (more money for them, cheaper products for us) if we opened our agricultural markets.
Instead, we have self-interested farming groups telling us it's actually in our national interests to keep our markets closed. (As if some foreign national writing our software is just fine and dandy for security...)
This is why the trade talks at Doha failed recently.
"Protectionism is always self-defeating"
While I agree with you that the threat of outsourcing has been overstated (with the overhead of more management, outsourcing often increases costs), I don't agree that protectionism is always bad.
Malaysia introduced protectionism after the Asian crisis and has done considerably better than its neighbour, Indonesia, which embraced the IMF's dictates to open their markets.
"what better way than to take protectionist measures that will instantly invite retaliation?"
Retaliation??? India and China don't even let white people invest directly in their stockmarkets right now! ( "India's stock market is still largely closed to foreign investors ... unless you are a resident of India [or] a person of Indian origin").
So, I'm not sure what exactly they are going to do for retaliation.
America can afford to have little/no protectionism. It is a huge trading bloc and has the most powerful military in the World. When it comes to contentious issues, it's pretty hard for small and/or poor countries to argue with them. Unless there is a balance of power in negotiations, don't expect these countries to drop their protectionist policies.
You can but whether you should is moot. You forget about the management overhead in co-ordinating these people. Ever tried to manage somebody in another country? It's not easy. Unless there are dozens of people on the team, it is more cost-effective to have them on-site. Remember: management is the most expensive resource on an IT project. If you offshore your programmers but need to increase your management, you are not likely to make savings (unless the number of programmers you offshore is huge - see my previous post).
On-site teams are also far more effective. Architectural principles are the same the World over. But who would seriously consider building a house with their architect in - say - South Africa?
Look at Siemens and what tehy are doing with telecommunications.
Can you be more specific?
I'm a consultant - I convert gibberish into cash-flow.
Good for you! Most consultants I know convert cash-flow into gibberish!
Nope! Just because the software is free does not mean you don't need on-site programmers. On the contrary, they become more important.
Take this as example:
Laws are free to use. Buying a book on law is almost free ($50 max). But there is no chance that lawyers (practitioners of law) will go out of business.
Similarly, software may be free but that does not mean we don't need programmers (practitioners of software engineering). Somebody has to add value to that free software to give the company a competitive advantage.
Whatsmore, here in England, thanks to out colonial heritage, we have lots of lawyers elsewhere in the World who can practise English law. But who offshores their lawyers to - for example - the Bahamas? (The Bahamas has as its highest court of appeal, the English Privy Council). Sure, Bahaman lawyers are cheaper but it's much more cost effective to employ somebody who is sitting next to you.
That's the direction software engineering is going in the more developed countries, I believe. For any team of programmers less than about 10, it is more expensive to offshore due to the additional management overhead.
But, then your tongue is in your cheek, right? :-P
I mean a lawyer doesn't manufacture contracts, does he? He provides a service.
Similarly, I provide a service by writing code (which is a contract with the computer).
We don't (directly) pay for laws. They are made by our governments. Sometimes, they are even made by lawyers working pro bono (ie, free). Laws also are modified over time (maintenance).
These are direct parallels to programming. So, why do people say coding is manufacturing but law is a service?
And do lawyers complain that somebody else making laws that they use reduces their jobs to a support role?
(BTW, do people say that lawyers working pro bono are destroying jobs?)
We hired some chimps from a huge international consultancy. The document they produced is so piss-poor we are on our sixth draft. In the time this has taken (2 months) with two very expensive consultants working full time and two in-house developers checking their work part-time, we have
The threat of offshoring has been massively over stated. More and more companies are seeing that this process (send the requirement to India) is simply not cost-effective. It may take some time for all PHBs to see this but it will happen. That's business.
There is (hopefully) a happy ending. The outsource providers tendering for this gig are charging in the region of 700UKP/day (about $1200/day) for a Java programmer with about 3 years experience (I'm not making this up). Most say that they can cut that cost by about a third if we offshored. Well, gee, that's still more expensive than hiring some local contractor with 7 years experience who can sit down and talk to the business people. We're getting "buy-in" from management to save money and not offshore. We'll have a decision soon and it looks good.
Agile methodologies will be the saviour of the Western programmer.
- Because, typically, CEOs sit on the remuneration committee of the execs (or their friends) who sit on his.
- Because the marketing and management bods know that supply and demand curves aren't as the text book shows them (see the myth of the "perfect market" that Munger talks about).
- Because managers earn, say 30% more than their immediate subbordinates. And 30% more than a guy in India doesn't sound appealing. Ergo, there is a human factor that defies economics.
- We don't need expensive people who capture requirements.
- We don't need expensive managers to oversee our relationships with the offshored team.
- We can turn on a dime as the market changes.
Bottom line: outsourcing is expensive!
A salesman in a shiny suit came to talk to us about offshoring. The total costs (when you consider the fees he and his chums were charging) were higher than using on-shore programmers.
This is why all the jobs won't go abroad. Just those that were trivial.
I have a couple of friends in investment banks that tell me offshore work is coming back to the UK and that the managers now considered sending it half way around the World an expensive mistake.
You guys in America are stuffed in the short-term, though, 'cos your bosses love management trends (anybody remember downsizing in the early 90s...?). Management in Europe is more circumspect about jumping on the latest band-wagon.