It makes some sense that SCO would start with a user of both Unix and Linux, because the Unix license presents a target for their legal strategy. i.e. a contract that the user is breaking by using Linux as well.
When it comes to certain fields like call centers and software development, certain countries (like India) can use labor cost as a competitive advantage. The data to back this up lies in the number of large companies that are pursuing this specific cost savings through the use of offshore development houses. They can take the same body of work and get it done for less somewhere else. They really don't care if it takes 1 high-paid developer or 1,000 lower-paid ones, what matters is the overall cost.
That said, labor cost is of course only one component of such an initiative. The customer must be able to manage the relationship very carefully, which presumably adds to administrative costs, as well as exposing the company to a host of potential risks.
The US has long suffered from a shortage of low-skill labor, however. I don't see many US-born people who want to become farm laborers, maids, slaughterhouse workers, etc. We simply look down on those forms of "menial" labor (unjustly, in my view - there is no shame in any honest job).
That said, I don't think yesterday's proposal was primarily meant to benefit employers. It's not like these workers were about to be exported, anyway. It's pure election-year posturing to court the Hispanic vote in key states like California...
The real issue is what happens when everyone acts this way (outsourcing abroad). The US trade deficit goes up.
BZZZZZZZZZZZZZTTTTTT!!!! Wrong, try again.
The trade deficit is the result of a strong dollar (until recently very strong), healthy consumer demand, and a lack of domestic savings to fund investment. And when money gets "shipped out" for imported goods and services, it's not like those dollars just disappear - since by definition they aren't getting spent on US goods for export, instead they are invested back in the US. Currently, for example, the federal deficit is largely funded by Asian central banks which are buying US Treasuries by the truckload.
It will be interesting to see if the dollar's recent slide continues, and how that plays out in the goods and labor markets. I suspect that the level of offshoring might not live up to projections in the years ahead...
You're looking at the numbers across the entire economy - obviously when talking about tech offshoring, you would need to look at productivity within that field...
One of the few interesting notions that the fields of economics has come up with is that when you allow countries to compete freely, and shift employment to areas in which they can be their most productive, EVERYBODY wins. International trade is not a zero-sum game, and growth in international trade has helped lift tens of millions of people out of absolute poverty over the last couple decades (see South Korea, India, China, and Japan before that).
Go look at a few decades worth of US unemployment data. You'd think we'd have unemployment rates of 25% or more if folks like you and Ross Perot (remember Nafta?) were right.
But you're wrong.
As jobs get moved overseas, new ones get created here all the time. The US economy is incredibly good at reallocating capital and labor away from poor performing areas to higher-growth ones. Venture capitalists are constantly on the hunt to fund promising new enterprises. Entrepreneurship is a field open to just about anybody with the motivation to make it happen.
The continuing drive for efficiency and excellence is a STRENGTH of the US economy, not its bane. Self-pitying excuse makers who want society to pay for their lack of initiative are a greater threat.
Then why not move? Where you live, where you work, what you drive, etc. are all personal choices. Obviously you place a very high premium on where you live, since you're willing to commute so far and pay so much that you can't afford to have kids...
While I would agree with most of your post regarding overpayment, execs on each other's boards taking care of each other, etc., there is a big difference between CxO's and IT personnel.
There are very, very few people qualified to run major corporations, compared to the positions available. That's just an unpleasant fact. In IT, particularly after the job losses of recent years, the situation is more a buyer's market.
Oh, and given the fact that business is a highly competitive endeavor, it isn't possible for all execs to do a "good job". There will always be companies running into the ground as their competitors move forward. The trick, however, is to ensure that the chief doesn't earn $zillions unjustly along the way (see Gary Welch of Conseco, for example).
You can't expect every nuance of an argument to be packed into a single statement quoted in a news article.
I'm sure Ms. Fiorina understands the issue at hand, and the fact is that even when taking productivity differences into account, many other countries are able to beat the US on costs. Where IT workers in the US can compete is in terms of innovation, proximity and working relationship with the user base which is driving development, and other qualitative factors.
In terms of cost, any productivity advantage the US worker has is vastly overwhelmed by the wage differences across different countries.
By valuation, I was referring to market capitalization, which is the value placed on the company by the market (share price times outstanding shares). What you're referring to (assets minus liabilities) is more of an accounting measure like Book Value than anything else.
My point was that if you spent $12 billion for an asset that returns $200 million per year, you've waaaay overpaid compared to the return you could get elsewhere.
He is in the perfect position to complain, as a customer requesting technical support. He shouldn't have to learn a foreign language just to get help reviving an ailing system.
That said, I've had very good experiences in the past with "follow the sun" tech support from HP when I was a night-shift HP3000 operator. I suspect that widely used platforms requiring more support staff would be tougher to handle well.
I thought with a Dutch auction, everybody gets charged the same price, which is the highest price that ensures that all shares get sold. For instance, if you have 50 shares to sell, and the bids are:
10 @ $40 25 @ $35 15 @ $33 10 @ $30 15 @ $27
then the first 3 orders get filled, all at the $33 mark. In that scenario, there's still room for some opening-day "pop", and the company's owners still get a much better return than under a typical IPO.
$200 million profit on a $12 billion market cap in and of itself points to an absurdly overbought stock. The only thing that could possibly justify such a valuation would be an expectation of rapid earnings growth, of the kind that everybody knew was "right around the corner" in the late 90's...
The comparison of design/assembly splits between manufacturing and software development provided some useful insight, but it's not like companies don't realize this.
The hard part about realizing the gains from outsourcing is that most firms aren't up to managing such a long-term, strategic relationship in the manner that's required. When the work is done in-house, you can trust that the developers have your company's best interest in mind - when dealing with an outsourcer, their ultimate goal is to extract as much money from you as possible. If done right, it can be worth it, but as we've seen, many firms haven't been up to that challenge.
You have to remember, however, that the First Amendment doesn't refer to "politically expressive" speech, it just refers to speech in general. The problem we have here (and I'm pretty liberal as well) is that there is a mindset out there that if anything happens that you don't like, you can cry foul and find your just reward through the courts. What is sorely needed is some form of punitive measure for frivilous, stupid lawsuits such as this.
I would think that the hard part about offshore tech support is trying to support widely used platforms, requiring large amounts of staff. Back in my beginning IS days, I was the night operator for an HP3000 data center, and HP's "follow the sun" tech support never failed to deliver top-notch help, whether I was speaking to a native English speaker in Australia or someone with a very thick accent (I presumed Indian). When you have a specific, narrowly-focused product to support, it's easier to hire 10-20 techs rather than the hundreds that may be required to support something like a retail laptop or desktop...
You have to remember that Dell's competitive advantage lies in their elite-level supply chain. Unlike other computer manufacturers, they only keep a few days worth of inventory on-hand, as opposed to over a month for their competitors. This lowers their costs, and helps them adapt quicker to a changing marketplace.
When they find particular items that aren't flying off the shelves like they're supposed to, Dell is not shy about "creating demand" to move them out the door. I would bet good money that they have too many +R drives stacking up, and are simply bleeding off excess inventory.
Slashdot Mirror
Those aren't super glue commercials, they're for...
Crraaaaaazzzzzyyyyy Glue!
Strong enough to suspend this man in thin air!
(I guess thick air is outta the question)
It makes some sense that SCO would start with a user of both Unix and Linux, because the Unix license presents a target for their legal strategy. i.e. a contract that the user is breaking by using Linux as well.
Where's the booth girl review?
I'll state my claim for myself, thank you!
When it comes to certain fields like call centers and software development, certain countries (like India) can use labor cost as a competitive advantage. The data to back this up lies in the number of large companies that are pursuing this specific cost savings through the use of offshore development houses. They can take the same body of work and get it done for less somewhere else. They really don't care if it takes 1 high-paid developer or 1,000 lower-paid ones, what matters is the overall cost.
That said, labor cost is of course only one component of such an initiative. The customer must be able to manage the relationship very carefully, which presumably adds to administrative costs, as well as exposing the company to a host of potential risks.
The US has long suffered from a shortage of low-skill labor, however. I don't see many US-born people who want to become farm laborers, maids, slaughterhouse workers, etc. We simply look down on those forms of "menial" labor (unjustly, in my view - there is no shame in any honest job).
That said, I don't think yesterday's proposal was primarily meant to benefit employers. It's not like these workers were about to be exported, anyway. It's pure election-year posturing to court the Hispanic vote in key states like California...
The real issue is what happens when everyone acts this way (outsourcing abroad). The US trade deficit goes up.
BZZZZZZZZZZZZZTTTTTT!!!! Wrong, try again.
The trade deficit is the result of a strong dollar (until recently very strong), healthy consumer demand, and a lack of domestic savings to fund investment. And when money gets "shipped out" for imported goods and services, it's not like those dollars just disappear - since by definition they aren't getting spent on US goods for export, instead they are invested back in the US. Currently, for example, the federal deficit is largely funded by Asian central banks which are buying US Treasuries by the truckload.
It will be interesting to see if the dollar's recent slide continues, and how that plays out in the goods and labor markets. I suspect that the level of offshoring might not live up to projections in the years ahead...
You're looking at the numbers across the entire economy - obviously when talking about tech offshoring, you would need to look at productivity within that field...
Okay, Chicken Little, I'll bite -
One of the few interesting notions that the fields of economics has come up with is that when you allow countries to compete freely, and shift employment to areas in which they can be their most productive, EVERYBODY wins. International trade is not a zero-sum game, and growth in international trade has helped lift tens of millions of people out of absolute poverty over the last couple decades (see South Korea, India, China, and Japan before that).
Go look at a few decades worth of US unemployment data. You'd think we'd have unemployment rates of 25% or more if folks like you and Ross Perot (remember Nafta?) were right.
But you're wrong.
As jobs get moved overseas, new ones get created here all the time. The US economy is incredibly good at reallocating capital and labor away from poor performing areas to higher-growth ones. Venture capitalists are constantly on the hunt to fund promising new enterprises. Entrepreneurship is a field open to just about anybody with the motivation to make it happen.
The continuing drive for efficiency and excellence is a STRENGTH of the US economy, not its bane. Self-pitying excuse makers who want society to pay for their lack of initiative are a greater threat.
Then why not move? Where you live, where you work, what you drive, etc. are all personal choices. Obviously you place a very high premium on where you live, since you're willing to commute so far and pay so much that you can't afford to have kids...
While I would agree with most of your post regarding overpayment, execs on each other's boards taking care of each other, etc., there is a big difference between CxO's and IT personnel.
There are very, very few people qualified to run major corporations, compared to the positions available. That's just an unpleasant fact. In IT, particularly after the job losses of recent years, the situation is more a buyer's market.
Oh, and given the fact that business is a highly competitive endeavor, it isn't possible for all execs to do a "good job". There will always be companies running into the ground as their competitors move forward. The trick, however, is to ensure that the chief doesn't earn $zillions unjustly along the way (see Gary Welch of Conseco, for example).
I thought the quote was, "I say, let 'em crash"...
The quote about minimum wages isn't Carly's - go back and read it again. You're not the first one to have made that mistake in this discussion...
You can't expect every nuance of an argument to be packed into a single statement quoted in a news article.
I'm sure Ms. Fiorina understands the issue at hand, and the fact is that even when taking productivity differences into account, many other countries are able to beat the US on costs. Where IT workers in the US can compete is in terms of innovation, proximity and working relationship with the user base which is driving development, and other qualitative factors.
In terms of cost, any productivity advantage the US worker has is vastly overwhelmed by the wage differences across different countries.
Forget robot dogs, flys, and lobsters. Give the soldiers something they'd actually use, like robot women!
By valuation, I was referring to market capitalization, which is the value placed on the company by the market (share price times outstanding shares). What you're referring to (assets minus liabilities) is more of an accounting measure like Book Value than anything else.
My point was that if you spent $12 billion for an asset that returns $200 million per year, you've waaaay overpaid compared to the return you could get elsewhere.
He is in the perfect position to complain, as a customer requesting technical support. He shouldn't have to learn a foreign language just to get help reviving an ailing system.
That said, I've had very good experiences in the past with "follow the sun" tech support from HP when I was a night-shift HP3000 operator. I suspect that widely used platforms requiring more support staff would be tougher to handle well.
I thought it was just that the coffee killed them off so fast they didn't have time to develop the diabetes...
I thought with a Dutch auction, everybody gets charged the same price, which is the highest price that ensures that all shares get sold.
For instance, if you have 50 shares to sell, and the bids are:
10 @ $40
25 @ $35
15 @ $33
10 @ $30
15 @ $27
then the first 3 orders get filled, all at the $33 mark. In that scenario, there's still room for some opening-day "pop", and the company's owners still get a much better return than under a typical IPO.
$200 million profit on a $12 billion market cap in and of itself points to an absurdly overbought stock. The only thing that could possibly justify such a valuation would be an expectation of rapid earnings growth, of the kind that everybody knew was "right around the corner" in the late 90's...
The comparison of design/assembly splits between manufacturing and software development provided some useful insight, but it's not like companies don't realize this.
The hard part about realizing the gains from outsourcing is that most firms aren't up to managing such a long-term, strategic relationship in the manner that's required. When the work is done in-house, you can trust that the developers have your company's best interest in mind - when dealing with an outsourcer, their ultimate goal is to extract as much money from you as possible. If done right, it can be worth it, but as we've seen, many firms haven't been up to that challenge.
It coulda been worse, though - if he had been found guilty, they would have sent him out to sea in a burning ship...
You have to remember, however, that the First Amendment doesn't refer to "politically expressive" speech, it just refers to speech in general. The problem we have here (and I'm pretty liberal as well) is that there is a mindset out there that if anything happens that you don't like, you can cry foul and find your just reward through the courts. What is sorely needed is some form of punitive measure for frivilous, stupid lawsuits such as this.
I would think that the hard part about offshore tech support is trying to support widely used platforms, requiring large amounts of staff. Back in my beginning IS days, I was the night operator for an HP3000 data center, and HP's "follow the sun" tech support never failed to deliver top-notch help, whether I was speaking to a native English speaker in Australia or someone with a very thick accent (I presumed Indian). When you have a specific, narrowly-focused product to support, it's easier to hire 10-20 techs rather than the hundreds that may be required to support something like a retail laptop or desktop...
You have to remember that Dell's competitive advantage lies in their elite-level supply chain. Unlike other computer manufacturers, they only keep a few days worth of inventory on-hand, as opposed to over a month for their competitors. This lowers their costs, and helps them adapt quicker to a changing marketplace.
When they find particular items that aren't flying off the shelves like they're supposed to, Dell is not shy about "creating demand" to move them out the door. I would bet good money that they have too many +R drives stacking up, and are simply bleeding off excess inventory.
Hold her own? The whole point is that you don't want to have to hold your own...