Outsourcing, defined simply, is hiring someone to do your work outside of your organization. This can be done within the same city, state or country or overseas. While outsourcing is a very broad term, many times it has become synonymous with work that is specifically contracted to India. This connection was magnified in the year 2000, when Indian programmers were called upon to fix a complicated issue that became known as Y2K. In the United States, countless companies panicked over the possibility that massive data loss and software failure were on the horizon, based on the need to switch from two-digit year entries, to four-digit year entries to account for the millennium. The United States based companies then turned to Indian outsourcing companies to resolve these issues in a timely manner as Indian programmers represent more than 1/3 of total global qualified human resources pool available.
After Y2K was resolved satisfactorily, many Indian programmers remained in the United States on H1B visa, and in their positions to continue to work within their outsourcing companies. Quickly Indian programmers from India infiltrated the fast growing market of the software industry when they began accepting jobs from overseas; in an effort to protect job availability in the US. This effort slowed down significantly when companies began sending more and more of their workload overseas, as a tactic to keep their costs low and their profits high to optimize shareholder’s values. This tactical approach for sourcing resources abroad became the present understanding of “Outsourcing.”
A number of difficult social, economical, political questions arose from this resource allocation conversion. Let’s take an in-depth look into what’s going on.
One of the implication of this outsourcing trend affected Government resource needs. During this transformation of extracting more values for an organization, many state government and some federal jobs went to H1B visa holders, or overseas. Many people under these hard economic times want to know why our own state is giving away jobs to overseas companies? It’s simple: to manage operating budget under highly competitive global environment. Every state needs to reduce costs and spending to satisfy their constituency. From a political angle, we tend to hear a lot of talk from different states boldly announcing their opposition to contracts with companies that outsource their labor overseas. At the same time, THEY ARE the ones giving away the jobs to foreign companies.
In reality, outsourcing isn’t the fundamental problem. The problem manifests when local private companies apply the same hypocrisy? Why do they do this?
Some customer service companies shut the doors on all their locations in the USA and outsourced their work to the Philippines or to companies who outsource to Philippine labor. Why the Philippine and not India or Mexico? In the Philippines, the laborers tends have better speaking accents to be better understood by US customers. However, when it comes to technical support… The Philippines fall short. Companies who need technical support then have to look to India to satisfy their labor needs. Do companies get complaints from customers on Indian accent? Of course they do. But when companies need to outsource to India, they have limited options.
Prior to India, in 1990’s, all work was sent to Ireland. When Ireland was handing all tech support there was no uproar – Why?
Isn’t Ireland a foreign country?
Aren’t jobs still going missing in the US?
Post your comments on why Ireland was never poked in 1990’s?
As we move forward, companies will inevitably continue to seek cheap labor globally, regardless of the country. This mega trend of globalization can’t be stopped unless we become a socialist/communist country with a closed-off economy. We all know this will not happen, or would it?
If the US really wanted to control outsourcing, why allow Indian corporations control the global fiber capacity? I am talking about TATA Communications purchasing of Tyco Fiber and Reliance buying up of FLAG. Why didn’t US government step in and stop the sale? Is the answer that an openly capitalistic country we never do that? Do we simply allow to be affected by foreign companies and turning to the government to bail us out?
Of course, there needs to be a fundamental paradigm shift in our process of controlling and keeping the assets that yield our national security. This is only possible when the companies who own our assets are US citizens, and allow federal agencies with enough power to be proactive in keeping them secure.
In summary, outsourcing is a very complex subject with little truth known with many opinions and misconceptions – What a messy subject!! So far, at socio-economic level it has generated a negative connotation. Very few individuals represent this most misunderstood subject in a balanced manner. , Some people think that its the gum under your shoe- not going anywhere, and it is better if it’s left alone. Outsourcing doesn’t have to be this necessary evil; it can be a welcomed benefit when managed and communicated properly. Would Mr. Henry Ford still have invented the automobile if he could foresee our dependence on foreign oil? YES- he would, he was a capitalist, and so are you. Continue to think in an opportunistic way in this wonderful land of opportunity and many great things will happen to all of us.