After reading the "How Much" article, Think how productive the US software industry would be if there was that planning over here! Isn't that the REAL PROBLEM with the US software industry. Typically, most projects don't fail because of the coders, it's because most projects DON'T HAVE seperate postiions over here. Often the "product Manager" is also the master coder, there are not "gui designers", "software architects", etc over here, just a room full of "programmers".
That's an interesting point. In my experience it is just one manifestation of a fundamental problem afflicting IT and, indeed, much of American business. The problem is one of wastefully misusing assets and technologies, then replacing them because they are not performing well. Eventually businesses may deal with large vendors who enforce a kind of sanity on them, but it may be too late, and not all of the large vendors are your friends.
A CASE HISTORY
I saw one case in which a company had a perfectly serviceable computer system. They had never sent anyone for training on the specialized software. They were a little pissed at the vendor after having been caught running the software on a much larger system than it was licensed for. The settlement involved buying a very complete, very expensive license to legitimize all that they were doing. They hired one of the vendor programmers and figured that they could then cut off all connection to the vendor and never pay another cent. The former vendor programmer didn't like the guys running the company, though, and stayed across the street at the parent company. No comprehensive training of users or system managers was ever done, and the software was somewhat underutilized.
Nonetheless, it did the job and the company ran perfectly well on it through several doublings of their business up to and beyond $200 million/year, except that reluctance to keep the mainframe system up to date caused the hardware to be pegged at 100% most of the day.
Making a very bad choice in the face of the obvious
The logical thing to do would have been to upgrade or cluster the main system. The brand was no longer fashionable, though, so they set about replacing the system. This led to a year-long project with a major vendor of the type of software they used. Naturally, the vendor shamed them into doing comprehensive user and programmer training on the new software, something the client had been too stupid to do with the original software. Onsite training began nearly a year before final cutover, and in the heat of the project there were about 30 vendor people on site, all young freshly scrubbed young out-of-town professionals on the way up, housed temporarily in local apartments in the upscale area around the plant.
Just a few months into the project the client went ahead and bought a second of the original system at a cost of over $300,000 in hardware and software because business was booming and the old single system wasn't going to handle the load through the end of the project.
The original staff of 3-4 programmers swelled to about 20 with the addition of specialists in the new hardware and software. The model of AS/400 originally thought to be adequate for the new system was found to be far short of the mark, and another, one of the largest, had to be bought.
Avoiding the obvious at a cost of $10-20 million
Had they never embarked on the new project, and had they simply brought in the second machine as they did anyway, they would have been set to double their business over the next few years and their total outlay would have been a bit over $300,000. As it was I estimate they spent between $10 million and $20 million to replace a $300-600,000 system and quintuple their ongoing programming staff expense. Smart business minds at work there, eh?
All this outsourcing will continue until the first Pakistani nuke drops on Mumbai.
Well, yes, there is that. There are many dangers short of that, though. Large amounts of sensitive personal and corporate information are being sent overseas as part of offshoring. Trade secrets and other intellectual property are being placed in the hands of foreigners who may in the long term take a predatory view of the entire U.S. economy. Worst of all, perhaps, there is word that increasing amounts of defense work are going overseas, and corporate executives and government officials alike are brushing off concerns about risks to national security. Odd, eh?
You will need to form an association of IT people in the USA and hire some great lobbyists to encourage politicians that it is in the best interest of America to institute tarriffs on companies using outsourced labour rather than US IT association labor.
It's not just IT jobs that are being bled. It now includes engineering jobs of all descriptions, accounting, paralegal, legal, investment analysis, radiology... the list has exploded.
The foreign purveyors, the quasi-U.S. pimps and the pointy-haired U.S. managers and glazed-eyed U.S. executives who have lately been trying to drive a planet-size truck through this window of opportunity have been stupid enough to overdo it to the point at which virtually all Americans will feel it, directly or indirectly, and virtually all skilled workers and professionals are becoming sensitized to this issue.
In other words the "backlash" will increasingly be coming from voters across the spectrum. Large numbers of angry voters don't need highly developed and specialized lobbying organizations. All they need to do is vote, and make it crystal clear to the politicians that those who fail to see the handwriting on the wall will not be in office for long.
This issue cuts across all lines in the society. I don't recall having seen such an issue arise in my lifetime.
As a former H1B worker now settled happily back in India, would like to share my experience.
Way back in '97 I was working for a large telecom company's office...
That was before the linked problems of guest workers and offshoring became epidemic. That was before U.S. techies were being threatened with loss of severance to get them to train their low-paid foreign replacements before being laid off, which is one of the most disgusting, scum-sucking weasel practices to have been seen in the U.S. employment scene since we did away with company towns and private company police.
Personally, I hope you did well and benefitted from your tour here. The problem is not and never was the Indian worker willing to come here on an H1B. The problem now is gross and widespread abuse of the H1B and L1 by foreign and quasi-U.S. companies, and their weasel U.S. client companies. This seems to be condoned and even encouraged by some of our politicians -- politicians we will be working to put on the unemployment line.
From the postings, some common reasons why people think outsourcing is bad:
Code quality is bad
That's a disingenuous argument. It's like the railroad workers' unions trying to save the caboose positions because they claimed to be consumed by concern for the safety of passengers. Yeah. Sure.
Code quality may be bad, but that argument is going nowhere. If it's true, the marketplace will severely punish those who tread that path.
Problem of context. Developers don't get to interact with clients.
Again, its just plain silly for the complaining programmers to expect anyone to believe that they, the programmers, are altruistically concerned about what happens to clients after outsourcing and that they're not concerned first and foremost about their own jobs.
There are serious conextual problems in outsourcing... language, distance, culture, creativity, initiative, scope, dedication to making things work right, business practices, etc., but when the folks who are threatened try to hang their hats on those arguments, it rings false. These are the same people who regularly abandon their employers to move down the street for a few $K more, and they don't worry about what happens in their former environments when they do that. Why should anyone believe that they worry about what will happen to "clients" after their employers abandon them for outsourcing or offshoring?
They should compete on equal terms with respect to Health benefits, labor laws etc..
Maybe they should, but that argument is also without compelling force. If the offshore and local outsourcing players were competing on an equal footing, they wouldn't be doing much competing. They're only in this game because they have an unequal advantage -- tons of cheap, skilled labor.
One area where our gummint is completely falling down on the job, though, is in making sure that A) H1Bs are only granted for positions that truly can't be filled from U.S. labor pools, and B) that H1Bs are not used as indentured servants worked at long hours and at low pay to give their employers and clients undeserved advantages over U.S. workers.
Another is in ensuring that L1s cannot just be hired off the street in Bombay or Bangalore, shipped here as intra-company transfers, and then formed out to stupid, cost-cutting American pointy-haired employers.
I am losing my job to foriegn code-monkeys
Well, this is really what it's all about, isn't it? And there's nothing wrong with that. This is a legitimate concern because this is our country.
Unless and until the entire world is raised to the U.S. standard of living, it will never be possible to throw open the borders to foreign workers without dropping U.S. salaries and wages to the lowest common denominator, say the lowest that an equivalently skilled person in the backwoods of China may be willing to work for.
Until then, any developed nation that doesn't want to be completely gutted must exert sovereign control over its borders, not keeping all things out but jealously controlling those things that will destroy its economy.
IT is a unique industry, because it's in all markets and drives economies, it cannot be a good idea to let your corporations give away the one thing that makes your country a super power. Lets get some real economic and political arguments out there.
Quite so. The most effective arguments, though, are those of raw political power. The politicians of both stripes who have been in favor of this don't yet realize that they have kindled around themselves what may turn out to be the hottest political firestorm of their lives. Even more universal than IT is employment, and the combined guest worker / offshoring problem is affecting far more than just IT.
This problem will be addressed when U.S. policitians realize that they have to choose between campaign donations from promoters of H1B/L1 and offshoring on the one hand and votes on the other. Even the lowest, poorest, sorriest, out of work, former IT person can still.
As usual, the politicians are seriously lagging behind reality in this, still thinking that they can A) take the money and promote job loss with globalization and cost-saving mumbo-jumbo, B) take the money while talking like they care about jobs, or C) ignore the issue. As this heats up they will slowly come to realize that they have created a monster. The greatest danger will be in overreaction, both by the electorate and the politicians who will at some point be running very scared.
...introduce arguments that level the playing feild. (Enforce minimum work and pay conditions in India...
A sovereign nation doesn't solve its leaky border problem by making suggestions to another sovereign power to raise the standards in that country. Moreover, India likes its present ability to tap into the U.S. economy.
This is fundamentally a problem of lack of control of our borders, not of globalization. Go find out how an office secretary can afford to live and work in Zurich or Geneva and you'll realize that Switzerland preserves its standard of living by jealously controlling its borders, the entry, conduct and exit of guest workers, and the manner in which citizenship may be obtained. Children of foreigners who merely happen to be born in Switzerland do *not* gain Swiss citizenship, for example.
It's also essential to understand that the guest worker programs and offshoring are inextricably related. If H1Bs and L1s are abolished or severely curtailed and controlled, it will be much more difficult for companies to offshore significant areas of their work.
> IANAL, but as far as I know, in order to get
> an H1B you have to show that no American is
> able or willing to fill the job.
That's the theory, but in practice they appaterently don't have to assert that claim under penalties of perjury, and no one in the government *ever* checks to see if the claim was true. The purveyors of H1B and L1 guest workers are so confident that they can get away with anything at all that there have been job ads spotted that clearly discriminate against U.S. residents and citizens, with no consequences.
The H1B has nominal, lip-service protections written into the law but apparently with no penalties and zero oversight. The L1, though is the real racket, with no such requirements, no quotas, and renewability.
L1 is ostensibly for intra-company transfers. Say Mercedes was going to build an auto plant in the U.S. They'd have to bring over a cadre of engineers and managers to get the plant built, staffed and operating over the course of several years. It would be silly to expect the Mercedes personnel who would be here temporarily to have to apply for tourist/business visas and get max 6 month stays at the whim of the examiner at the port of arrival. THAT is what the L1 is for.
But here is how it really works: An Indian "consultancy" hires an Indian off the street in India, say for $6,000/year. Now the new guy is an employee of the company, and eligible for being transferred *within* the company to its U.S. office -- an intra-company transfer. He is sent to the U.S. and housed in a company dormitory to save even more money, and minimal out of pocket expenses are given to him. The U.S. office then FARMS HIM OUT to a U.S. client company for, say, $30/hour. So much for intra-company, eh? The guy never was and still isn't involved in the business of his employer. He's a body and they're body-shopping him out.
Worse, our Indian guest is not paid any salary or wage here at all. He continues to be paid in India. Neither he nor his employer pays any tax here. His salary never leaves India, while you can bet that the Indian company uses interesting and creative chargebacks to its U.S. office to shift profit either back to India or to some even more favorable place.
Slashdot Mirror
mabhatter654 wrote:
That's an interesting point. In my experience it is just one manifestation of a fundamental problem afflicting IT and, indeed, much of American business. The problem is one of wastefully misusing assets and technologies, then replacing them because they are not performing well. Eventually businesses may deal with large vendors who enforce a kind of sanity on them, but it may be too late, and not all of the large vendors are your friends.
A CASE HISTORY
I saw one case in which a company had a perfectly serviceable computer system. They had never sent anyone for training on the specialized software. They were a little pissed at the vendor after having been caught running the software on a much larger system than it was licensed for. The settlement involved buying a very complete, very expensive license to legitimize all that they were doing. They hired one of the vendor programmers and figured that they could then cut off all connection to the vendor and never pay another cent. The former vendor programmer didn't like the guys running the company, though, and stayed across the street at the parent company. No comprehensive training of users or system managers was ever done, and the software was somewhat underutilized.
Nonetheless, it did the job and the company ran perfectly well on it through several doublings of their business up to and beyond $200 million/year, except that reluctance to keep the mainframe system up to date caused the hardware to be pegged at 100% most of the day.
Making a very bad choice in the face of the obvious
The logical thing to do would have been to upgrade or cluster the main system. The brand was no longer fashionable, though, so they set about replacing the system. This led to a year-long project with a major vendor of the type of software they used. Naturally, the vendor shamed them into doing comprehensive user and programmer training on the new software, something the client had been too stupid to do with the original software. Onsite training began nearly a year before final cutover, and in the heat of the project there were about 30 vendor people on site, all young freshly scrubbed young out-of-town professionals on the way up, housed temporarily in local apartments in the upscale area around the plant.
Just a few months into the project the client went ahead and bought a second of the original system at a cost of over $300,000 in hardware and software because business was booming and the old single system wasn't going to handle the load through the end of the project.
The original staff of 3-4 programmers swelled to about 20 with the addition of specialists in the new hardware and software. The model of AS/400 originally thought to be adequate for the new system was found to be far short of the mark, and another, one of the largest, had to be bought.
Avoiding the obvious at a cost of $10-20 million
Had they never embarked on the new project, and had they simply brought in the second machine as they did anyway, they would have been set to double their business over the next few years and their total outlay would have been a bit over $300,000. As it was I estimate they spent between $10 million and $20 million to replace a $300-600,000 system and quintuple their ongoing programming staff expense. Smart business minds at work there, eh?
How to blow $6 million in one shot
It gets better. About $6 million of the total cos
RevSmiley wrote:
Well, yes, there is that. There are many dangers short of that, though. Large amounts of sensitive personal and corporate information are being sent overseas as part of offshoring. Trade secrets and other intellectual property are being placed in the hands of foreigners who may in the long term take a predatory view of the entire U.S. economy. Worst of all, perhaps, there is word that increasing amounts of defense work are going overseas, and corporate executives and government officials alike are brushing off concerns about risks to national security. Odd, eh?
ziaz wrote:
It's not just IT jobs that are being bled. It now includes engineering jobs of all descriptions, accounting, paralegal, legal, investment analysis, radiology... the list has exploded.
The foreign purveyors, the quasi-U.S. pimps and the pointy-haired U.S. managers and glazed-eyed U.S. executives who have lately been trying to drive a planet-size truck through this window of opportunity have been stupid enough to overdo it to the point at which virtually all Americans will feel it, directly or indirectly, and virtually all skilled workers and professionals are becoming sensitized to this issue.
In other words the "backlash" will increasingly be coming from voters across the spectrum. Large numbers of angry voters don't need highly developed and specialized lobbying organizations. All they need to do is vote, and make it crystal clear to the politicians that those who fail to see the handwriting on the wall will not be in office for long.
This issue cuts across all lines in the society. I don't recall having seen such an issue arise in my lifetime.
Anonymous Coward writes:
That was before the linked problems of guest workers and offshoring became epidemic. That was before U.S. techies were being threatened with loss of severance to get them to train their low-paid foreign replacements before being laid off, which is one of the most disgusting, scum-sucking weasel practices to have been seen in the U.S. employment scene since we did away with company towns and private company police.
Personally, I hope you did well and benefitted from your tour here. The problem is not and never was the Indian worker willing to come here on an H1B. The problem now is gross and widespread abuse of the H1B and L1 by foreign and quasi-U.S. companies, and their weasel U.S. client companies. This seems to be condoned and even encouraged by some of our politicians -- politicians we will be working to put on the unemployment line.
swapsn writes:
That's a disingenuous argument. It's like the railroad workers' unions trying to save the caboose positions because they claimed to be consumed by concern for the safety of passengers. Yeah. Sure.
Code quality may be bad, but that argument is going nowhere. If it's true, the marketplace will severely punish those who tread that path.
Again, its just plain silly for the complaining programmers to expect anyone to believe that they, the programmers, are altruistically concerned about what happens to clients after outsourcing and that they're not concerned first and foremost about their own jobs.
There are serious conextual problems in outsourcing... language, distance, culture, creativity, initiative, scope, dedication to making things work right, business practices, etc., but when the folks who are threatened try to hang their hats on those arguments, it rings false. These are the same people who regularly abandon their employers to move down the street for a few $K more, and they don't worry about what happens in their former environments when they do that. Why should anyone believe that they worry about what will happen to "clients" after their employers abandon them for outsourcing or offshoring?
Maybe they should, but that argument is also without compelling force. If the offshore and local outsourcing players were competing on an equal footing, they wouldn't be doing much competing. They're only in this game because they have an unequal advantage -- tons of cheap, skilled labor.
One area where our gummint is completely falling down on the job, though, is in making sure that A) H1Bs are only granted for positions that truly can't be filled from U.S. labor pools, and B) that H1Bs are not used as indentured servants worked at long hours and at low pay to give their employers and clients undeserved advantages over U.S. workers.
Another is in ensuring that L1s cannot just be hired off the street in Bombay or Bangalore, shipped here as intra-company transfers, and then formed out to stupid, cost-cutting American pointy-haired employers.
Well, this is really what it's all about, isn't it? And there's nothing wrong with that. This is a legitimate concern because this is our country.
Unless and until the entire world is raised to the U.S. standard of living, it will never be possible to throw open the borders to foreign workers without dropping U.S. salaries and wages to the lowest common denominator, say the lowest that an equivalently skilled person in the backwoods of China may be willing to work for.
Until then, any developed nation that doesn't want to be completely gutted must exert sovereign control over its borders, not keeping all things out but jealously controlling those things that will destroy its economy.
Anonymous Coward writes:
Quite so. The most effective arguments, though, are those of raw political power. The politicians of both stripes who have been in favor of this don't yet realize that they have kindled around themselves what may turn out to be the hottest political firestorm of their lives. Even more universal than IT is employment, and the combined guest worker / offshoring problem is affecting far more than just IT.
This problem will be addressed when U.S. policitians realize that they have to choose between campaign donations from promoters of H1B/L1 and offshoring on the one hand and votes on the other. Even the lowest, poorest, sorriest, out of work, former IT person can still .
As usual, the politicians are seriously lagging behind reality in this, still thinking that they can A) take the money and promote job loss with globalization and cost-saving mumbo-jumbo, B) take the money while talking like they care about jobs, or C) ignore the issue. As this heats up they will slowly come to realize that they have created a monster. The greatest danger will be in overreaction, both by the electorate and the politicians who will at some point be running very scared.
A sovereign nation doesn't solve its leaky border problem by making suggestions to another sovereign power to raise the standards in that country. Moreover, India likes its present ability to tap into the U.S. economy.
This is fundamentally a problem of lack of control of our borders, not of globalization. Go find out how an office secretary can afford to live and work in Zurich or Geneva and you'll realize that Switzerland preserves its standard of living by jealously controlling its borders, the entry, conduct and exit of guest workers, and the manner in which citizenship may be obtained. Children of foreigners who merely happen to be born in Switzerland do *not* gain Swiss citizenship, for example.
It's also essential to understand that the guest worker programs and offshoring are inextricably related. If H1Bs and L1s are abolished or severely curtailed and controlled, it will be much more difficult for companies to offshore significant areas of their work.
> IANAL, but as far as I know, in order to get > an H1B you have to show that no American is > able or willing to fill the job. That's the theory, but in practice they appaterently don't have to assert that claim under penalties of perjury, and no one in the government *ever* checks to see if the claim was true. The purveyors of H1B and L1 guest workers are so confident that they can get away with anything at all that there have been job ads spotted that clearly discriminate against U.S. residents and citizens, with no consequences. The H1B has nominal, lip-service protections written into the law but apparently with no penalties and zero oversight. The L1, though is the real racket, with no such requirements, no quotas, and renewability. L1 is ostensibly for intra-company transfers. Say Mercedes was going to build an auto plant in the U.S. They'd have to bring over a cadre of engineers and managers to get the plant built, staffed and operating over the course of several years. It would be silly to expect the Mercedes personnel who would be here temporarily to have to apply for tourist/business visas and get max 6 month stays at the whim of the examiner at the port of arrival. THAT is what the L1 is for. But here is how it really works: An Indian "consultancy" hires an Indian off the street in India, say for $6,000/year. Now the new guy is an employee of the company, and eligible for being transferred *within* the company to its U.S. office -- an intra-company transfer. He is sent to the U.S. and housed in a company dormitory to save even more money, and minimal out of pocket expenses are given to him. The U.S. office then FARMS HIM OUT to a U.S. client company for, say, $30/hour. So much for intra-company, eh? The guy never was and still isn't involved in the business of his employer. He's a body and they're body-shopping him out. Worse, our Indian guest is not paid any salary or wage here at all. He continues to be paid in India. Neither he nor his employer pays any tax here. His salary never leaves India, while you can bet that the Indian company uses interesting and creative chargebacks to its U.S. office to shift profit either back to India or to some even more favorable place.