I couldn't read to the end because of the bad formatting. Let me fix some of it: This is true of outsourcing generally, not just outsourcing to lower cost offs

I couldn't read to the end because of the bad formatting. Let me fix some of it: This is true of outsourcing generally, not just outsourcing to lower cost offshore regions. Back in 2000 I left my secure dev job with a large US bank to join a startup and chase the dotcom boom with a startup. The crash happened, I got laid off, no one was hiring, so I ended up joining a boutique 'consultancy' doing dev for banks. Over the course of the next three years I learnt a brutal lesson in the consultancy development business model. As this post points out, there's a fundamental misalignment of interests. The client wants the project done, and the consultant resources gone. The consulting firm wants maximum headcount on the project for maximum duration, and therefore maximum billing. This misalignment means the consulting firm can't speak the truth to the client. The consulting firm can't speak the truth to their employees either, and will usually give them some flim flam about how consultancy is the best of all possible worlds as it combines the security of permanent employment with the variety of contracting. In fact it combines the worst of both - the insecurity of contracting with the lower pay of permie work. Consultancy firms run on one key benchmark - utilisation level. Most, like ThoughtWorks or IBM Global Services, will aim for 65 to 70%. That means 65-70% of employee hours must be billable to a client. If you drop below that rate you have to fire people. At the 'boutique' consultancy I worked for they ran at 95%. Folk would roll off a client assignment at 5pm on a Friday, and get a phone call firing them at 5.10pm! So far, so simple. As the original post made clear, it's all about margin. And, as the original post also made clear, the result of this business model is one disastrous project after another. So why does it keep happening? The fault there lies on the client side. The clients hiring the outsourcing and consultancy firms are usually large corporates looking to manage costs down. The project sponsors are senior managers with long term careers in these highly political organisations. When their projects fail they can't make a fuss about it as that would draw attention to their own management failures. Instead they have to pretend the project is a qualified success, and jump to another team or silo in the corporate environment so some other sucker is left clearing up the fallout. So the consequences of failure are repeatedly eluded, as Mr Pointy Headed Manager slips off to another team, and the consulting firm moves on to the next billing opportunity. I was a little shocked when all this became apparent to me, back in 2002/3, when I saw a $25,000,000 project get canned by a large US bank without ever getting into production. Now of course I understand that it's just how orgs like EDS and IBM Global Services make their money. And the upside is, as the article points out, that it enables wealth transfer from developed economies in North America and Western Europe, to developing regions like Eastern Europe and India, by means of rising developer salaries. The conclusion I draw is don't ever work for a 'consulting' firm like ThoughtWorks. Be a permie or a contractor...