Some eye opening statistics.
I have a note on the fact about IT worker salaries at the bottom.
Click on the image to make it larger.
Update: I am done with comments.
It’s my opinion and my blog.
It’s how I feel, it’s what I’ve experienced and it has been a hot topic of discussion among most of my consultant colleagues (most of whom agree) as well as CONFIRMED by outsourced consultants who end up moving here and working here.
If I told you: China outsourcing their work to England is really crap, because they don’t know their stuff, there’s a time difference, they don’t speak Mandarin, and don’t like to say NO all the time, would you be as angry?
If I worked in India, I’d learn how to shut up and work in that beehive mentality.
If I worked in China or even Japan, I’d learn pretty fast that women are not really appreciated as business women with ideas and opinions.
If I worked in France I’d surely be mocked for my awful accent.
I’d have to ADJUST my own attitude towards those cultural attitudes, and this is not what they do when they work with North American companies and it is FRUSTRATING.
Just think about it. Some of you are getting mad just because it’s India or Brazil that are the largest receivers of offshore IT consulting.
The amount of money makes people lie to get it, even if they haven’t earned it.
I’m really talking about liars in general, and outsourcing offshore seems to be rife with them, because of the amount of money they can earn in an hour compared to what they can earn in their own country.
And it happens at all levels, not just in this situation.
That was my only point. Remove “India and Brazil” from my notes below and see if you feel angry after.
So maybe in YOUR lines of work in IT, and the programming you deal with, they aren’t earning $60 – $80/hour for typing some code.
So yeah, maybe they know their stuff in other IT areas.
But not in mine, and it’s from MY perspective that I am writing from.
I have seen all evidence to the contrary BECAUSE they can generally earn triple the amount than in other programming areas.
On any given project, I noticed a ratio of about 4 offshore programmers trying to do the work of what ONE onshore programmer can do.
They simply don’t have the experience.
That comparison between American and Indian IT workers is taken out of context.
As an IT worker myself, in (North) America, I could regale you with stories about how clients thought they could cut corners and hire an Indian (or Brazilian, another top country) IT firm to do their work for much cheaper.
They thought they could just outsource all the coding and be done with it but ended up spending more money in the end just to finish the project, than if they had started and done it the correct way the first time.
It’s like buying a pair of cheap plastic shoes and then realizing your feet are blistered after a week of wearing them and the heel broke off, so you go back and buy the expensive pair of leather shoes to save your feet.
You just wish you had spent the money up front instead of wasting time and buying the plastic pair in the first place.
These are the most common problems with outsourcing:
Things take a long time to materialize from them. Or not at all. One client waited 3 months before realizing they were doomed, with 2 months left to complete the project.
They couldn’t understand simple and clear specifications and took them a week to understand and code, rather than the half day.
They don’t have the experience but they lie and say they do.
The trick is that they send Indian IT workers over to Canada or the U.S. for a week or two, and then when they go back, they claim their workers worked for the client on-site for the entire duration of the project.
They work in a beehive mentality, so nothing can get done independently with them, without explicit approval from their head project manager who knows jack about the system.
They work in a different time zone which screws both sides because you have to wait 24 hours before getting a response, which is not only frustrating, but holds up the project for the littlest changes.
They tell you it’s “on the way” and then we play the frustrating miscommunication game until we realize that they have no idea about what to do.
They do this instead of admitting that they don’t understand the first time around, and don’t want to ask for clarifications.
So those North American IT workers earning $0.13 to their $0.025 is WELL DESERVED in my opinion.
- Seriously? Did I just say "those people who learn another language are freaking morons"? I didn’t think so.
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@3270luddite
on Dec 22nd, 2009
@ 4:56 PM:
Absolutely spot-on. The beehive mentality is especially true – where everyone is responsible, then nobody is effectively responsible. And it's not just India – we outsource a lot of stuff to Latin America (Argentina especially) where the hive effect is made worse by machismo.
However, it's interesting when you deal with the time zones – due to the difference in working day, you get this cool ping-pong effect – give clear instructions, small achievable goals, go home, come in the next day, and stuff is usually done. Only effective with stable teams and long timelines, though – something else that you don't get with outsourced development.
StyckyWycket
on Dec 22nd, 2009
@ 4:58 PM:
I enjoyed your interpretation of the data particularly about this article. What I find the most frustrating about people quoting "horror" statistics is that there is no contextual basis for the numbers.
Lynx
on Dec 22nd, 2009
@ 5:06 PM:
Out sourcing is not always cheaper monetary wise either. We do some very specialized work at my company and its very hard to find workers who fit. We are located between 2 national labs in a county with the most PHDs per capita in the US and even with geniuses everywhere theres just not people with the right skillsets. We've tried recruiting from Bay Area, Silicon Valley, Redmond and Seattle types same thing.
We were forced to outsource because theres just not the workers in the US. To get the type of specialized programmers we need in India, Brazil and eastern Europe it was costing us slightly more per hour than our US workers for the same position for slightly less quality of work. You also have to add in the cost of additional QA to catch the extra bugs and mistakes as well.
With outsourcing you have to be exact in what you want, if you are going to go through and spell out all the steps one by one for them to follow you might as well just do it yourself. US workers are better at thinking for themselves and problem solving if they encounter some unexpected glitch to work around. If you add in all the additional cost for more QA, documentation and extra work to integrate with outsources the cost difference isnt that much and at least in our case it was significantly more but we have no choice with out finding more US based help.
Rachel @ It's a hero
on Dec 22nd, 2009
@ 6:51 PM:
I'm a big fan of this diagram, tho. It really shows some other crucial differences, don't you think?
CDE
on Dec 22nd, 2009
@ 10:12 PM:
As a person who lead teams on both sides, on and off shore, I would say the difference is not 1 to 5. It is more like 1 to 2. Unless, the off shore team, can act independently and run by an American manager, I don't see a success story.
Little House
on Dec 22nd, 2009
@ 5:30 PM:
I have to comment on the food thrown away. It's ridiculous to think that so much food is wasted in the US while others starve. Of course, we can't donate all of our left overs to starving populations. (Or can we?) But, we can compost a lot of that food instead of throwing into the dump where methane gas builds up. The compost can then be used in gardens instead of nitrate filled fertilizers. It's much healthier for the environment!
P.S. I hear you on clients outsourcing for a cheaper rate, then hobbling back once the project has been botched! (my husband designs websites, he's experienced this first hand!)
BalloonAnimal
on Dec 22nd, 2009
@ 11:20 PM:
It's a shame there's not a 'dislike' button in my google reader for this post.
The statistics are interesting but your comments about outsourcing to Indian workers are generalist and a little ignorant. Particularly this one:
"They don’t have the experience but they lie and say they do."
Actually, if you had any understanding of the indian culture at all you'd know that they think refusing or saying no is the height of rudeness. So they will agree to anything to avoid being rude. People with sensitivity to cultural differences will check and double check and ask them to repeat what they're agreeing to, and then gently correct any misunderstandings. And yes, there are language difficulties sometimes, and yes they do sometimes insist on getting approval from their manager- but a lot of the time that's down to the constraints of how the contract is set up.
But can you HONESTLY say there aren't problems with people lying about experience or misunderstanding specs with American companies?
Please, you're better than these sorts of ridiculous blanket statements.
Mrs. Money
on Dec 23rd, 2009
@ 2:55 AM:
FB- You are the best!
Indian Thoughts
on Dec 23rd, 2009
@ 5:07 AM:
I am an Indian and quite disappointed to see such a post. Thanks, now i'll have one less blog to read in the day.
Rina
on Dec 23rd, 2009
@ 6:52 AM:
Loved reading this. Great post. I agree a billion percent with you on the IT bit – I hate calling a customer support line and getting someone from another country, who seems to know less than I do and to top it all of, we can hardly understand eachother.
Wow, that sounded really bad.
But it really is true!
Ryan@PlantingDollars
on Dec 23rd, 2009
@ 9:12 AM:
68 out of 107 deaths are from starvation? If that's true… WOW, definitely an eye opener for me.
Thanks for sharing this, where did you find it?
I found something similar on youtube a while back, but with different stats… check it out:
http://www.youtube.com/watch?v=jpEnFwiqdx8
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 7:51 AM:
Sorry to see you leave, but I stand by my personal experience and opinion.
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 7:53 AM:
Look, I’m the one who has been friends with these Indian IT workers and they have ADMITTED TO ME THAT THEY’VE LIED
They claim they’ve worked for an Indian company doing systems work for 10 years before coming to North America, and then when I ask them a simple question they should know, they can’t answer it.
Point blank, I am not making a blanket statement — it’s true that it’s bullshit.
I even had one Indian colleague tell me that he started in one area of a systems section and then decided it wasn’t enough money, so changed all the words on his resume to reflect another, even though he had ZERO EXPERIENCE.
Say what you want — I know what I heard and what I experience on projects.
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 7:55 AM:
Thank goodness someone agrees.
Everyone might think I am some sort of racist writing that, but I know what happens on IT projects — I’ve experienced all of that bullshit and it’s kind of crap that no one knows how it really runs on a project, and just assumes price = cheaper = better.
And I didn’t just say Indian, I said Brazilian too — another country they love to outsource items to.
It could have also been China, Malaysia, or any other country that has cheaper labour and a workforce where 1 in 100 could actually know what they’re doing without proper training.
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 7:56 AM:
I mentioned Brazil in there.
They also have a beehive mentality, but it kind of depends who you end up working for.
The time zones kill me, when things have to be done on time so it can hit a training/testing schedule and it delays by a day or two each time there’s a problem… and then we get blamed
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 7:58 AM:
Ah but you are in a different industry no?
In IT, there are billions of available, FAKE IT workers who are screwing it up for the rest of their compatriots who actually know their job.
I am not saying that ALL outsourced countries — India, Brazil, China too I think — are all awful at their jobs, but on the whole, I groan when I hear “outsourced” or “you are going to be working with an offshore team”….
I just know that I am in for it, having to spend an extra hour each time just to deal with making sure what they did was right, and hounding them to give me the program on time so I can meet my own deadlines.
FB @ FabulouslyBroke.com
on Dec 23rd, 2009
@ 8:00 AM:
I agree that we don’t compost here. If we did have an area in apartment buildings to put in food and waste so that it could be turned and used as fertilizer then we’d cut down on a LOT of waste.
It’s something I really saw in Portugal.
As for outsourcing in general — it’s a chronic problem from what I can see. It’s easier if they’re here ON SITE but then the client doesn’t want to pay for hotel and food etc..
But it’s also that they just don’t have the experience but they lie and say they do. In almost all cases. And it’s not something where i can say: “You are lying here”….. but it’s more of ….”you don’t know this [simple thing]?? “…
And then you realize that they just haven’t done the work before even though they have 10+ years.
It’s frustrating because then when you DON’T lie on your resume and have actual, solid experience, you get burned at the stake for not having 10+ years experience.
A bit of a catch 22
Tntn
on Dec 23rd, 2009
@ 6:45 PM:
I've been reading your blog for some time now, and this is the first time I've forced myself to comment. I agree Outsourcing can be a disaster if not handled correctly. I also agree with you about a few, screwing it for the rest of us. (I have seen people with no relevant experience, having resumes with 10-12 years of experience, and info to back it up).
However, I work for a big 4 consulting firm in the US, and we've had extremely successful projects using an offshore model. The key factor was to have a US support team (people from Offshore, and led by US managers), and a supplemental off shore team. I've seen that outsourcing mostly fails when clients are trying to get away too cheap.. When you are looking to cut costs by 60-75%, you kinda know what you are getting into..
As one of the posts above said, by stereotyping, your comments come off as generalist and Ignorant. There are a lot of Indians, Chinese… people who I have studied/worked with who are great at what they do. With these comments, you are no different than a regular Joe, who criticizes outsourcing, but would enjoy the benefits of it, without a second thought. I would think you are better off than that…
Laura
on Dec 24th, 2009
@ 3:31 AM:
I love that any one can find statistics to support whatever oppinion one has. Maybe this was your experience, but the post sure came across as a generalization of an entire country. And you are entitled to your oppinion and I am not saying you should change it or not, but it did not sit well with me and makes me look differently at the rest of your posts.
FB @ FabulouslyBroke.com
on Dec 24th, 2009
@ 10:02 AM:
*shrug*
It’s what I feel and what I think. It’s why I have a blog.
FB @ FabulouslyBroke.com
on Dec 24th, 2009
@ 10:05 AM:
It was my experience not yours. I have never been on, or seen any other project to contradict what I’ve observed so far.
Plus, it was first-hand experience of these offshore folks TELLING US (bragging?) that they were lying on their resume just to get the job
Tell me now, what would you have done in a similar situation?
Said: “Oh you must be lying about THAT, I work for a Big 4 consulting firm that does a lot of offshore work successfully”?
Tntn
on Dec 25th, 2009
@ 4:19 PM:
I DID NOT DENY the fact about people lying in their resume.. I hate it as much as anyone else.. and would like for something to be done about it..
You are missing the point here.. I am just p***d about the way you have generalized the people of a few countries.. In fact, I think most of the commenters agree with you, except for this point.
Nita
on Dec 29th, 2009
@ 10:52 PM:
I rarely post but something about your thoughts on oursourcing and the blatant generalization you have made about workers from 'other' nations that you obviously consider inferior just hit a nerve.
What on earth could you have meant by the comment "It could have also been China, Malaysia, or any other country that has cheaper labour and a workforce where 1 in 100 could actually know what they're doing without proper training."
It's a convoluted sentence to begin with, but it seems to me that what you were trying to say was, any country with a workforce that might charge less than your rate for a service (IT or otherwise) is likely to be under-educated and untrained? That's a ridiculous generalization, and claiming to 'know someone personally who proves this point' is a poor excuse.
I worked as a Teaching Assistant at a top-20 rated University in the US for 3 years and was astounded by the number of American students who couldn't differentiate between 'your', 'you're'; 'its' and 'it's'. Does this mean I have the right to say that Americans cannot speak basic English, just because 'I know lots of people who have proven this point'?
I'm an occasional reader of this blog, and really have to agree with Balloon Animal above: come on, FB, you're better than this post.
FB @ FabulouslyBroke.com
on Dec 29th, 2009
@ 6:31 PM:
It is only by chance that India is on that list
if it was any other country, would you be as pissed off?
maybe not. If I said: Chinese outsourcing to Americans is effing BULLSHIT
would you be as angry?
Nope.
uberVU - social comments
on Jan 28th, 2010
@ 6:14 AM:
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