7 ms·

The Real Reason Outsourcing Continues To Fail

102 points by gacba 17y ago

patio11 17y ago
I have mixed feelings on this, as somebody who does outsourcing from a country which is not known for failure to appreciate subtle social dynamics. (Korean has six different forms of address based on relative rank? I could actually use six before lunch on a typical day at the office.) On the one hand, we've had outsourcing projects suffer from cultural issues. However, they're not all related to the high PDI/low PDI distinction -- some of them you could shoehorn into that, to be true, but sometimes when any engineer swears that he absolutely will have a project ready by the end of the day he is just estimating poorly rather than being overly polite. The number one problem we have had in outsourcing to a particular country is pervasive competence issues, followed by communication issues (egads, no, Babelfish is not an acceptable way to translate engineering documents), followed by a poor mesh in management styles which is exacerbated by both of the other two. We outsource to another country, where we have not had the pervasive competence issues. Things tend to go much better there. I'm not going to name names, but suffice it to say they're both in that top 10 list and within a few points of each other.
wglb 17y ago
I don't put much credibility in Gladwell's arguments, particularly since Greenspun's analysis: http://philip.greenspun.com/flying/foreign-airline-safety http://philip.greenspun.com/flying/foreign-airline-safety in which, among other things, Greenspun notes that Gladwell did not talk to any pilots.
- mahmud 17y ago
  Gladwell is sloppy, but to be fair, in that essay, it seemed like Greenspun was out to avenge Pinker (MIT). It was more attack than criticism.
  - ynniv 17y ago
    Sloppy evidence is far more damaging than no evidence. The fact that this author even brings up Gladwell caused me to stop reading. In light of Greenspun's argument that domestic pilots have orders of magnitude more experience, Gladwell's argument is worthless at best. But clearly, Gladwell's argument is worse than worthless, because now people are using it as anecdotal evidence in other realms. Even worse, the OP picked this anecdote because it is the same as his own hypothesis.
    - mahmud 17y ago
      Yes, agreed. Gladwell is sloppy, it's just that Greenspun's essay was not where I discovered this fact. As far as Gladwell debunkings go, the philg attempt was the least convincing.
- gacba 17y ago
  Greenspun's arguments are bit a flippant, as noted here in the ending comments: "To see just how much of a factor this is, look at how mishap rates plummeted after the introduction of CRM training at US carriers in the late 1970s/early 1980s. Prior to widespread CRM training, the culture at major US carriers was largely as Gladwell describes current foreign carrier culture: the captain's word was final, and co-pilots didn't speak up or contradict the captain." Dismissing PDI out of hand as "already handled" is perhaps being disingenuous about the role it may play.
  - wisty 17y ago
    I haven't read Gladwell's book, but does it compare Korean and USA PDI and disaster rates, or disaster rates from a large number of countries? If Gladwell has looked at a few more countries (and perhaps even ploted PDI against crashes) then he's done a much better job than Greenspun's comparison of "Foriegn" and "US" pilots. If not, then the ball would be in Gladwell's court (so to speak). It's obvious that Greenspun knows US air safety better than Gladwell though.
jteo 17y ago
Outsourcing doesn't work because good software engineers are few and far in between.
- gvb 17y ago
  Beyond that, management and accountant types make the assumption that everyone with the same job title is interchangeable. The result is that they take the work of local engineers with a substantial amount of domain knowledge (experience, which maps to higher salaries) and try to offshore it to engineers with no domain knowledge (inexperienced in the field of the application, and often inexperienced period). Because of their assumption of interchangeability, they end up with a lose-lose model of costs. For illustration, assume a (local) domain expert takes 1 hour to do a job and costs $100/hour. Assume the outsourced inexperienced engineer only costs $33/hour, but takes 3 hours to do the same job because first they have to learn the problem domain. When you outsource this job, it takes three hours and costs $99. Doing the math, this means the company "saved" $201 because the assumption of interchangeability implies (incorrectly) that the domain expert would also have taken 3 hours. When you "insource" the job, it takes one our and costs $100. By the math, the accountants figure they left $67 on the table because the assumption of interchangeability implies (again, incorrectly) that the outsourced engineer would also have taken 1 hour. The only way to win this game is to not play it.
  - drac 17y ago
    actually, I feel you may have made the case for outsourcing. In your example - it was a single task. Working with the assumption that domain expertise can be acquired on the job, the costs of doing subsequent jobs will be lower for the outsourced engineer. The more times the same task needs to be performed by the engineer, the cheaper outsourcing becomes. Your example just accounted for the startup cost, which can be assumed to be a one-off* *Is it that way in practice? at least in some projects, it is.
    - gvb 17y ago
      As others in this discussion have noted, there is a lot of churn in engineers at outsourcing shops, so the "start up" costs are forever. The outsourcing engineers I have worked with have been smart, but inexperienced. [edit] The ones I didn't work with were smart, experienced, and substantially more expensive. My gross extrapolation from my limited experience with outsourcing is that the engineers gain experience, but that experience makes them more valuable. Since they are smart, they use the outsourcing shop experience as a springboard into a better job, probably not in the outsourcing business or in a "higher up the food chain" (and thus more expensive) outsourcing shop. Outsourcing is like having a perpetual intern program - all the training costs but never getting the benefit of that training with a long term employee.
GFischer 17y ago
I'm not sure if I agree with the article. However, I'm going to add some anecdotal evidence about the differences in cultures: when some coworkers interacted with Mexico, they would often say "ahorita mismo" (right now) when they meant "sometime in the future"... if you didn't know what they'd do, you'd have been very disappointed (stuff they said they'd do "right now" got delayed very often).
- mattm 17y ago
  Haha, reminds me of a time in Croatia. A friend told me about a guy I would be working with. He said, "If he tells you it will be done in five minutes, that means he isn't going to do it."
ynniv 17y ago
Here's my hypothesis on outsourcing: the best people (no matter where they live) are hired locally, so if you aren't hiring locally, you're not hiring the best people. If you have prolonged experience with outsourcing, you'll notice that the better performers disappear after a while - they are being hired by someone local to them. On top of hiring the people who cannot otherwise find a good job, they might not speak your language well or at all, they are awake different hours of the day, and you are limited to communicating via telephone and webcam. I find this idea of PDI particularly distasteful because (a) there is no hard evidence so far, and (b) it makes "us" look better. History shows that people believe a lot of dumb things when those things make them look morally superior.
- bena 17y ago
  I didn't find the PDI thing too bad. It's a relatively simple assessment of how people react to authority. Consider it a distance to autonomy. The lower the PDI, the closer the average person in that group would consider themselves autonomous. Some countries value individual drive and an equality along all of the power spectrum where those in managerial positions are more like guides than commanders. Other countries have different cultures and values where those in obviously higher positions are deferred to and deserve to be treated with all respect their title confers on to them. Neither is better than the other, just different. And in order to work better with these other cultures, each side must understand the values held by the other side and reach some sort of middle ground where we can communicate with each other effectively. I do like your 'hired locally' hypothesis. It makes sense.
- gvb 17y ago
  My take on why the best jobs and the best employees are local jobs and local employees[1] is modeled in terms of the bandwidth and latency issue of communications. I did a lightning talk at the 2009 Great Lakes Software Excellence Conference using that theme. I posted the text and slides of that talk on my blog: http://jerryjousting.blogspot.com/2009/11/joe-plumber-and-control-theory.html http://jerryjousting.blogspot.com/2009/11/joe-plumber-and-co... [1] Distributed companies do work, but it is a lot harder to make them work well.
deleted 17y ago
[deleted]
michael_h 17y ago
This sounds somewhat plausible, but it has a flavor of "I'm just making this up, but it sounds okay!" to it.
pmichaud 17y ago
This actually rings true to my experience. I've been responsible for several outsourced problems, and one common factor among them is trying to get Indian programmers and PMs to just be straight with me. I've tried being direct by telling them that it's okay to tell me if something is wrong or to give me a realistic picture of progress, and I get "Yes sir, I will certainly be very honest with you, sir," but nothing changes. It's a difficult barrier. I haven't figured it out yet.
- known 17y ago
  Perhaps you should tell them to mail you anonymously
- swombat 17y ago
  That's one reason I prefer outsourcing to eastern europe. There are fewer cultural differences - importantly, there's no cultural taboo about telling you you're wrong or that they don't understand.
  - ivenkys 17y ago
    I have real experience with this and my experience with Eastern Europe/Russia is not very good - with India it is abysmal. Yes the cultural differences are less but in most cases the masking of the problem is still practised, albeit a little more efficiently , which means you find out the problems a little later, that's all. As someone else pointed out - Good developers are few and far between , irrespective of country and/or culture.
- plinkplonk 17y ago
  "I've been responsible for several outsourced problems, and one common factor among them is trying to get Indian programmers and PMs to just be straight with me.It's a difficult barrier. I haven't figured it out yet." I might be able to help (I'll probably get downmodded into oblivion when some of my fellow Indians wake up but ... ). The thing is, even in India the best (or even half way decent) programmers don't work for Infosys/Wipro/TCS and other outsourcing companies, who are probably the folks you are dealing with. The second tier outsourcing companies are worse. The good people go work for Google, or Yahoo or Microsoft, (and increasingly these days on their own startups) same as in the USA. The numbers of the latter are on the increase. The number of really good programmers is as low here as anywhere else. I know maybe half a dozen after fifteen years of working in Bangalore that I would trust my project to. Yet another (and the most important) factor is that all these outsourcing companies are heavily bureaucratic to a degree a Westerner can't imagine. Most of it happens because the economics dictate overstaffing. If your revenue model is N people * m $/ hr, it makes sense to increase N as much as possible on every project. Anyone who survives for long in one of these places is by definition someone who practices CYA as an artform. Anyone outspoken and/or willing to admit mistakes will be ejected from the system very fast. So yes, when you outsource crappy work to India (and most of the work outsourced here is mountains of legacy crap code no one in the West wants to work on anymore, often outsourced without meeting or talking to any of the engineers staffing the project, often on the basis of what some slick salesman put on his PowerPoint deck, yes then you get bad people. And that is the truth. Your experience is valid and is the norm. Working on outsourced enterprise projects, without hope of ever working on a decent codebase, is soul killing and degrading. You can't expect decent developers or managers on such projects. When someone replies "Yes sir, I will certainly be very honest with you, sir," that is a good sign you've got one of the bureaucratic ass kissers. "Sir" is always a danger sign. When you hear something like "WTF made you say that Peter? What are you really worried about?" you have a chance. Yes there are sharp developers and managers here, but it is hardly likely they'll be working in bottom feeding enterprise outsourcing companies. (The director level people at Infosys etc are often very sharp people, which is how they conned you into outsourcing your project to them but that is another story for another day ;-) ) Please don't outsource to India (or anywhere else) before speaking to and attaining a comfort level with engineers and other team members who will be working on your codebase. By the time you encounter these "yes sir, I'll be honest sir" types, you are already lost. My 2 cents. fwiw.
Dilpil 17y ago
I wonder if this is why many foreign firms like to hire people who were educated in the US? Perhaps they have noticed that these people are, for reasons neither the employee nor the employer understand, better at dealing with western customers due to time spent with americans?
jbarciauskas 17y ago
I wish they had some data on Bulgaria and other Eastern European countries that are growing quickly in the outsourcing market. I find the conclusion dubious, but it is an interesting consideration anyway.
arohner 17y ago
The author doesn't test his hypothesis, by comparing the success rate of outsourcing to a low PDI country.
- gacba 17y ago
  An excellent point. As soon as I work for/with someone who outsources to one, I'll follow up. :)
  - rickmode 17y ago
    That bring up an excellent point: is there a strong correlation between high-PDI countries and cheap outsourcing? Even more un-PC: is there a correlation with low-PDI and high-GDP?
  - zb 17y ago
    No need. This kind of stuff happens even to people working for the same company, in the same building, in low PDI countries. Outsourced projects fail for exactly the same reasons that other projects fail. The difference, if there is one, is that outsourced projects are more often set up to copy the exact features that are practically guaranteed to lead to disaster.
vl 17y ago
This story reminded me of general situation in some software projects at large companies without any outsourcing. Clueless manager comes in and asks if this can be finished by Friday, developer already knows from previous experience that discussing realistic dates brings no good and just says "sure" and continues to develop at his own slow demotivated pace. This article describes failure of communication which is not unique for outsourcing and can plagues any software project if contious attempts to avoid it are not made.
- notauser 17y ago
  Absolutely. Projects fail all the time, outsourcing makes projects harder by requiring people to pick up a phone, so you would expect outsourced projects to fail at a spectacular rate. From his list... Buyer’s unclear expectations up front - This happens on every single project due to a lack of crystal balls. Poor governance - I was talking to a guy from a Big 3 US car maker today who was griping about this very topic related to their US ops. Poor communication - This is in every project failure report I read, US/UK or anywhere in the world. Poor cultural fit - Have seen this on contracts between large and small companies, although it's usually not that much of a big deal. Interests become misaligned over time - Apple/Google is a good example of this. Google/Mozilla will be soon. Plenty of All-American examples here. Not mutually beneficial - Don't think this is just an outsourcing complaint either.
bediger 17y ago
This article really, really rings true for my experience with outsourcing. It's also totally ignored by anyone above bottom-manager in Giant Immoral MegaCorps. And by "ignored" I mean "taboo to speak of". One problem with outsourcing maintenance to folks from societies that, ah, respect authority to a great deal is that doing maintenance on any large code base will mean deciding that whoever did this the first time around Just Wasn't Thinking, and that you have to rip out and replace large hunks of barely-working, or slowly-working, or maybe non-working code. You just can't have any respect for the egos of those fools who came before you and wrote this drek.
ig1 17y ago
The fundamental issue isn't that outsourcing doesn't work, it's that outsourcing is seen as a way to get cheap labour. And cheap labour isn't high quality labour. Software development talent is highly mobile, and thus the best people are expensive everywhere in the world. If you go to a cheap outsourcing company in India who can't afford talented staff, then why are you surprised when they produce poor quality code ? Let's look at a market where local outsourcing works well: Web development. A huge amount of web development work in outsourced to small web development shops, both by large companies and small companies, and by and large the companies that outsource are happy. Because companies aren't outsourcing to cut costs, they're outsourcing because they don't have the in-house talent and therefore are willing to pay for expensive outsourcing options. If they decided to go for a cheap local web development outsourcing option (plenty on gumtree/craigslist), they'd get worse quality and be unhappy about it. Countries like India and China may well have separate issues due to cultural or language barriers, but they'd matter a lot less if the people being employed were talented in the first place.
ntulip 17y ago
very good read.
deleted 17y ago
[deleted]
joshu 17y ago
gripe: pie chart fail
eplanit 17y ago
While I'm not entirely convinced by the 'PDI Theory', I find it very persuasive. That said, the article's thesis presentation of the state-of-the-industry with respect to outsourcing is very, very well and accurately described. I have seen precisely that sequence of events and communications.
ytinas 17y ago
I've always been dubious of the value of outsourcing software development. Things like production are easy because after someone has 15 years of experience, he can't come to some developed country and make 20 times the money doing the same job the way developers can.
maheshs 17y ago
"it’s going to be another 2 weeks because we need the new servers to arrive" Believe me, this is totally false. In India (at least around Delhi) you just call any medium size shop, place your order, your order will reach to your door within next couple of hour. Pay the person on your door by cash or credit card (through wireless credit card payment machine). I buy a HP laptop with the same way around 15 days back, where dell was asking for four days for delivery.

102 points by gacba 17y ago

I have mixed feelings on this, as somebody who does outsourcing from a country which is not known for failure to appreciate subtle social dynamics. (Korean has six different forms of address based on relative rank? I could actually use six before lunch on a typical day at the office.) On the one hand, we've had outsourcing projects suffer from cultural issues. However, they're not all related to the high PDI/low PDI distinction -- some of them you could shoehorn into that, to be true, but sometimes when any engineer swears that he absolutely will have a project ready by the end of the day he is just estimating poorly rather than being overly polite. The number one problem we have had in outsourcing to a particular country is pervasive competence issues, followed by communication issues (egads, no, Babelfish is not an acceptable way to translate engineering documents), followed by a poor mesh in management styles which is exacerbated by both of the other two. We outsource to another country, where we have not had the pervasive competence issues. Things tend to go much better there. I'm not going to name names, but suffice it to say they're both in that top 10 list and within a few points of each other.

wglb 17y ago

I don't put much credibility in Gladwell's arguments, particularly since Greenspun's analysis: http://philip.greenspun.com/flying/foreign-airline-safety http://philip.greenspun.com/flying/foreign-airline-safety in which, among other things, Greenspun notes that Gladwell did not talk to any pilots.

mahmud 17y ago
Gladwell is sloppy, but to be fair, in that essay, it seemed like Greenspun was out to avenge Pinker (MIT). It was more attack than criticism.
- ynniv 17y ago
  Sloppy evidence is far more damaging than no evidence. The fact that this author even brings up Gladwell caused me to stop reading. In light of Greenspun's argument that domestic pilots have orders of magnitude more experience, Gladwell's argument is worthless at best. But clearly, Gladwell's argument is worse than worthless, because now people are using it as anecdotal evidence in other realms. Even worse, the OP picked this anecdote because it is the same as his own hypothesis.
  - mahmud 17y ago
    Yes, agreed. Gladwell is sloppy, it's just that Greenspun's essay was not where I discovered this fact. As far as Gladwell debunkings go, the philg attempt was the least convincing.
gacba 17y ago
Greenspun's arguments are bit a flippant, as noted here in the ending comments: "To see just how much of a factor this is, look at how mishap rates plummeted after the introduction of CRM training at US carriers in the late 1970s/early 1980s. Prior to widespread CRM training, the culture at major US carriers was largely as Gladwell describes current foreign carrier culture: the captain's word was final, and co-pilots didn't speak up or contradict the captain." Dismissing PDI out of hand as "already handled" is perhaps being disingenuous about the role it may play.
- wisty 17y ago
  I haven't read Gladwell's book, but does it compare Korean and USA PDI and disaster rates, or disaster rates from a large number of countries? If Gladwell has looked at a few more countries (and perhaps even ploted PDI against crashes) then he's done a much better job than Greenspun's comparison of "Foriegn" and "US" pilots. If not, then the ball would be in Gladwell's court (so to speak). It's obvious that Greenspun knows US air safety better than Gladwell though.

jteo 17y ago

Outsourcing doesn't work because good software engineers are few and far in between.

gvb 17y ago
Beyond that, management and accountant types make the assumption that everyone with the same job title is interchangeable. The result is that they take the work of local engineers with a substantial amount of domain knowledge (experience, which maps to higher salaries) and try to offshore it to engineers with no domain knowledge (inexperienced in the field of the application, and often inexperienced period). Because of their assumption of interchangeability, they end up with a lose-lose model of costs. For illustration, assume a (local) domain expert takes 1 hour to do a job and costs $100/hour. Assume the outsourced inexperienced engineer only costs $33/hour, but takes 3 hours to do the same job because first they have to learn the problem domain. When you outsource this job, it takes three hours and costs $99. Doing the math, this means the company "saved" $201 because the assumption of interchangeability implies (incorrectly) that the domain expert would also have taken 3 hours. When you "insource" the job, it takes one our and costs $100. By the math, the accountants figure they left $67 on the table because the assumption of interchangeability implies (again, incorrectly) that the outsourced engineer would also have taken 1 hour. The only way to win this game is to not play it.
- drac 17y ago
  actually, I feel you may have made the case for outsourcing. In your example - it was a single task. Working with the assumption that domain expertise can be acquired on the job, the costs of doing subsequent jobs will be lower for the outsourced engineer. The more times the same task needs to be performed by the engineer, the cheaper outsourcing becomes. Your example just accounted for the startup cost, which can be assumed to be a one-off* *Is it that way in practice? at least in some projects, it is.
  - gvb 17y ago
    As others in this discussion have noted, there is a lot of churn in engineers at outsourcing shops, so the "start up" costs are forever. The outsourcing engineers I have worked with have been smart, but inexperienced. [edit] The ones I didn't work with were smart, experienced, and substantially more expensive. My gross extrapolation from my limited experience with outsourcing is that the engineers gain experience, but that experience makes them more valuable. Since they are smart, they use the outsourcing shop experience as a springboard into a better job, probably not in the outsourcing business or in a "higher up the food chain" (and thus more expensive) outsourcing shop. Outsourcing is like having a perpetual intern program - all the training costs but never getting the benefit of that training with a long term employee.

GFischer 17y ago

I'm not sure if I agree with the article. However, I'm going to add some anecdotal evidence about the differences in cultures: when some coworkers interacted with Mexico, they would often say "ahorita mismo" (right now) when they meant "sometime in the future"... if you didn't know what they'd do, you'd have been very disappointed (stuff they said they'd do "right now" got delayed very often).

mattm 17y ago
Haha, reminds me of a time in Croatia. A friend told me about a guy I would be working with. He said, "If he tells you it will be done in five minutes, that means he isn't going to do it."

ynniv 17y ago

Here's my hypothesis on outsourcing: the best people (no matter where they live) are hired locally, so if you aren't hiring locally, you're not hiring the best people. If you have prolonged experience with outsourcing, you'll notice that the better performers disappear after a while - they are being hired by someone local to them. On top of hiring the people who cannot otherwise find a good job, they might not speak your language well or at all, they are awake different hours of the day, and you are limited to communicating via telephone and webcam. I find this idea of PDI particularly distasteful because (a) there is no hard evidence so far, and (b) it makes "us" look better. History shows that people believe a lot of dumb things when those things make them look morally superior.

bena 17y ago
I didn't find the PDI thing too bad. It's a relatively simple assessment of how people react to authority. Consider it a distance to autonomy. The lower the PDI, the closer the average person in that group would consider themselves autonomous. Some countries value individual drive and an equality along all of the power spectrum where those in managerial positions are more like guides than commanders. Other countries have different cultures and values where those in obviously higher positions are deferred to and deserve to be treated with all respect their title confers on to them. Neither is better than the other, just different. And in order to work better with these other cultures, each side must understand the values held by the other side and reach some sort of middle ground where we can communicate with each other effectively. I do like your 'hired locally' hypothesis. It makes sense.
gvb 17y ago
My take on why the best jobs and the best employees are local jobs and local employees[1] is modeled in terms of the bandwidth and latency issue of communications. I did a lightning talk at the 2009 Great Lakes Software Excellence Conference using that theme. I posted the text and slides of that talk on my blog: http://jerryjousting.blogspot.com/2009/11/joe-plumber-and-control-theory.html http://jerryjousting.blogspot.com/2009/11/joe-plumber-and-co... [1] Distributed companies do work, but it is a lot harder to make them work well.

deleted 17y ago

[deleted]

michael_h 17y ago

This sounds somewhat plausible, but it has a flavor of "I'm just making this up, but it sounds okay!" to it.

pmichaud 17y ago

This actually rings true to my experience. I've been responsible for several outsourced problems, and one common factor among them is trying to get Indian programmers and PMs to just be straight with me. I've tried being direct by telling them that it's okay to tell me if something is wrong or to give me a realistic picture of progress, and I get "Yes sir, I will certainly be very honest with you, sir," but nothing changes. It's a difficult barrier. I haven't figured it out yet.

known 17y ago
Perhaps you should tell them to mail you anonymously
swombat 17y ago
That's one reason I prefer outsourcing to eastern europe. There are fewer cultural differences - importantly, there's no cultural taboo about telling you you're wrong or that they don't understand.
- ivenkys 17y ago
  I have real experience with this and my experience with Eastern Europe/Russia is not very good - with India it is abysmal. Yes the cultural differences are less but in most cases the masking of the problem is still practised, albeit a little more efficiently , which means you find out the problems a little later, that's all. As someone else pointed out - Good developers are few and far between , irrespective of country and/or culture.
plinkplonk 17y ago
"I've been responsible for several outsourced problems, and one common factor among them is trying to get Indian programmers and PMs to just be straight with me.It's a difficult barrier. I haven't figured it out yet." I might be able to help (I'll probably get downmodded into oblivion when some of my fellow Indians wake up but ... ). The thing is, even in India the best (or even half way decent) programmers don't work for Infosys/Wipro/TCS and other outsourcing companies, who are probably the folks you are dealing with. The second tier outsourcing companies are worse. The good people go work for Google, or Yahoo or Microsoft, (and increasingly these days on their own startups) same as in the USA. The numbers of the latter are on the increase. The number of really good programmers is as low here as anywhere else. I know maybe half a dozen after fifteen years of working in Bangalore that I would trust my project to. Yet another (and the most important) factor is that all these outsourcing companies are heavily bureaucratic to a degree a Westerner can't imagine. Most of it happens because the economics dictate overstaffing. If your revenue model is N people * m $/ hr, it makes sense to increase N as much as possible on every project. Anyone who survives for long in one of these places is by definition someone who practices CYA as an artform. Anyone outspoken and/or willing to admit mistakes will be ejected from the system very fast. So yes, when you outsource crappy work to India (and most of the work outsourced here is mountains of legacy crap code no one in the West wants to work on anymore, often outsourced without meeting or talking to any of the engineers staffing the project, often on the basis of what some slick salesman put on his PowerPoint deck, yes then you get bad people. And that is the truth. Your experience is valid and is the norm. Working on outsourced enterprise projects, without hope of ever working on a decent codebase, is soul killing and degrading. You can't expect decent developers or managers on such projects. When someone replies "Yes sir, I will certainly be very honest with you, sir," that is a good sign you've got one of the bureaucratic ass kissers. "Sir" is always a danger sign. When you hear something like "WTF made you say that Peter? What are you really worried about?" you have a chance. Yes there are sharp developers and managers here, but it is hardly likely they'll be working in bottom feeding enterprise outsourcing companies. (The director level people at Infosys etc are often very sharp people, which is how they conned you into outsourcing your project to them but that is another story for another day ;-) ) Please don't outsource to India (or anywhere else) before speaking to and attaining a comfort level with engineers and other team members who will be working on your codebase. By the time you encounter these "yes sir, I'll be honest sir" types, you are already lost. My 2 cents. fwiw.

Dilpil 17y ago

I wonder if this is why many foreign firms like to hire people who were educated in the US? Perhaps they have noticed that these people are, for reasons neither the employee nor the employer understand, better at dealing with western customers due to time spent with americans?

jbarciauskas 17y ago

I wish they had some data on Bulgaria and other Eastern European countries that are growing quickly in the outsourcing market. I find the conclusion dubious, but it is an interesting consideration anyway.

arohner 17y ago

The author doesn't test his hypothesis, by comparing the success rate of outsourcing to a low PDI country.

gacba 17y ago
An excellent point. As soon as I work for/with someone who outsources to one, I'll follow up. :)
- rickmode 17y ago
  That bring up an excellent point: is there a strong correlation between high-PDI countries and cheap outsourcing? Even more un-PC: is there a correlation with low-PDI and high-GDP?
- zb 17y ago
  No need. This kind of stuff happens even to people working for the same company, in the same building, in low PDI countries. Outsourced projects fail for exactly the same reasons that other projects fail. The difference, if there is one, is that outsourced projects are more often set up to copy the exact features that are practically guaranteed to lead to disaster.

vl 17y ago

This story reminded me of general situation in some software projects at large companies without any outsourcing. Clueless manager comes in and asks if this can be finished by Friday, developer already knows from previous experience that discussing realistic dates brings no good and just says "sure" and continues to develop at his own slow demotivated pace. This article describes failure of communication which is not unique for outsourcing and can plagues any software project if contious attempts to avoid it are not made.

notauser 17y ago
Absolutely. Projects fail all the time, outsourcing makes projects harder by requiring people to pick up a phone, so you would expect outsourced projects to fail at a spectacular rate. From his list... Buyer’s unclear expectations up front - This happens on every single project due to a lack of crystal balls. Poor governance - I was talking to a guy from a Big 3 US car maker today who was griping about this very topic related to their US ops. Poor communication - This is in every project failure report I read, US/UK or anywhere in the world. Poor cultural fit - Have seen this on contracts between large and small companies, although it's usually not that much of a big deal. Interests become misaligned over time - Apple/Google is a good example of this. Google/Mozilla will be soon. Plenty of All-American examples here. Not mutually beneficial - Don't think this is just an outsourcing complaint either.

bediger 17y ago

This article really, really rings true for my experience with outsourcing. It's also totally ignored by anyone above bottom-manager in Giant Immoral MegaCorps. And by "ignored" I mean "taboo to speak of". One problem with outsourcing maintenance to folks from societies that, ah, respect authority to a great deal is that doing maintenance on any large code base will mean deciding that whoever did this the first time around Just Wasn't Thinking, and that you have to rip out and replace large hunks of barely-working, or slowly-working, or maybe non-working code. You just can't have any respect for the egos of those fools who came before you and wrote this drek.

ig1 17y ago

The fundamental issue isn't that outsourcing doesn't work, it's that outsourcing is seen as a way to get cheap labour. And cheap labour isn't high quality labour. Software development talent is highly mobile, and thus the best people are expensive everywhere in the world. If you go to a cheap outsourcing company in India who can't afford talented staff, then why are you surprised when they produce poor quality code ? Let's look at a market where local outsourcing works well: Web development. A huge amount of web development work in outsourced to small web development shops, both by large companies and small companies, and by and large the companies that outsource are happy. Because companies aren't outsourcing to cut costs, they're outsourcing because they don't have the in-house talent and therefore are willing to pay for expensive outsourcing options. If they decided to go for a cheap local web development outsourcing option (plenty on gumtree/craigslist), they'd get worse quality and be unhappy about it. Countries like India and China may well have separate issues due to cultural or language barriers, but they'd matter a lot less if the people being employed were talented in the first place.

ntulip 17y ago

very good read.

deleted 17y ago

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joshu 17y ago

gripe: pie chart fail

eplanit 17y ago

While I'm not entirely convinced by the 'PDI Theory', I find it very persuasive. That said, the article's thesis presentation of the state-of-the-industry with respect to outsourcing is very, very well and accurately described. I have seen precisely that sequence of events and communications.

ytinas 17y ago

I've always been dubious of the value of outsourcing software development. Things like production are easy because after someone has 15 years of experience, he can't come to some developed country and make 20 times the money doing the same job the way developers can.

maheshs 17y ago

"it’s going to be another 2 weeks because we need the new servers to arrive" Believe me, this is totally false. In India (at least around Delhi) you just call any medium size shop, place your order, your order will reach to your door within next couple of hour. Pay the person on your door by cash or credit card (through wireless credit card payment machine). I buy a HP laptop with the same way around 15 days back, where dell was asking for four days for delivery.