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Indian IT consultancies struggle against technological obsolescence

299 points by one_electron 6y ago

deadalus 6y ago
https://archive.is/j7xRa https://archive.is/j7xRa
- abrolhos 6y ago
  Thank you!
ETHisso2017 6y ago
I wonder what GPT-3 will do to their business models
- yourapostasy 6y ago
  Not sure about the business models, but it might generate pseudo-translations of the same article, like this: https://www.news98.info/indian-it-consultancies-wrestle-towards-technological-obsolescence/ https://www.news98.info/indian-it-consultancies-wrestle-towa... My eyes bled trying to read that hash.
the-dude 6y ago
There is little substance in the article. Biggest point made is that enterprise software is easier to administer and use. I feel they entirely missed the elephant in the room : SaaS.
- pwarner 6y ago
  Yes, SaaS and even IaaS and PaaS are the ultimate outsourcing. Outsourcing that actually works since it's not simply swapping a US based high paid human for a low paid off shore human. Instead it's swapping a human for automation, that's real savings for customers, even after margin for the automation creator.
- nmstoker 6y ago
  I certainly feel the article could have made more of their central points, which were mainly anecdotal / common sense. This is the part I'd like to have seen more proof and analysis around: "the Indian giants have also been unable to keep pace with technological change. Corporate software is becoming easier to use, reducing demand for their services. The lucrative legacy business of running mainframes is evaporating. Helping clients shift to the cloud makes money but not nearly as much."
- pm90 6y ago
  Yep, SaaS is the real outsourcing killer. And the future seems to be one where even more infrastructure is abstracted away i.e. Serverless/PaaS. This is changing the way software is built and tested. Its empowering people who have been through coding bootcamps to start delivering value.* * please note that I have nothing against coding bootcamps, the point is that most graduates of these bootcamps are by definition very new and green to Software Development.
- JAlexoid 6y ago
  They haven't. What do you think "cloud" is? (I'm a subscriber, I read the full article)
mjohn 6y ago
I recently joined a company where my main task is to modernise a business critical application built and supported by Wipro over ten years ago. Everything is still on .Net 3.0 (first released in 2007), and despite hundreds of pages of documentation the developers seem to have little understanding of what the application actually does for the business. The impression I have is that their business model is geared towards building one thing, learning one technology, and then exploiting it for as long as possible with minimal evolution. This is fine if you don't need the software to evolve, but most business applications do need to evolve even if slower than at a start-up or FAANG. At least where I work there has been the recent realisation that outsourcing all your technology means you will struggle to iterate and improve that technology.
- runawaybottle 6y ago
  Here’s the thing, I honestly think these consultancies are going to be feasting for decades to come with all these enterprise companies shifting to the cloud. That is the very definition of ‘their business model is geared towards building one thing, learning one technology, and then exploiting it for as long as possible with minimal evolution.’. This kind of lock-in at the enterprise level is a dream come true for them. They can marshal armies of AWS certified architects, and tie themselves to every corporation in the world, forever.
  - yourapostasy 6y ago
    I dunno, it could go either way. AWS is not cheap, unless you really understand the business domain, or someone else has done the hard work of understanding the business and re-architecting the design to leverage AWS' value propositions. It is painful to watch a team that doesn't understand what is really going on blindly rip and replace on-prem VM's with EC2's that only need to for example, run a script once a day to perform an extract and load operation in a few minutes. Even when you run pico instances, applying the same design culture across the enterprise adds up in a big hurry. This isn't Indian or non-Indian, this is "whether they deeply care about the customer enough to look for innovation on your own". You can't agile your way to nor bottle up and sell by the caseload innovation. I wish like hell we could, I'd buy a Panamax-load of that and mainline it into the fusion and AGI problems. What jrumbut said in this thread has some validity in certain scenarios, "Outsourcing turns an investment opportunity into an expense." And like the-dude said, the initial innovation is the automation behind aaS. It is up to those who build on top of aaS to carry that innovation momentum forward by adding their own innovation, the innovation isn't transitive nor inheritable by just using *aaS, which seems to be happening a lot currently though that is changing at an accelerating pace.
MattGaiser 6y ago
Isn't this also true of IBM? All these consulting firms have an expensive business model which is increasingly no longer useful.
- raverbashing 6y ago
  I'm sure IBM and other companies get a non trivial amount of checks with a lot of zeros each year for supporting legacy applications/systems/etc with barely any work involved on their part besides maybe running Make again once in a while. And to be fair, some companies are not even wrong because rewriting is still more expensive than just paying for maintenance.
geogra4 6y ago
Well, at least from where I sit they're still getting plenty of business as with the apparent sun-setting of the H1-B program companies are just hiring offshoring firms instead.
- dominotw 6y ago
  > with the apparent sun-setting of the H1-B program companies are just hiring offshoring firms instead. Are you speculating here or have seen an actual trend out there?
  - deleted 6y ago
    [deleted]
  - JAlexoid 6y ago
    The article mentions that big corporate tech departments are just moving their operations to Indie - like Walmart has Walmart Labs in India, despite having no retail business there.
    - dominotw 6y ago
      That has nothing to do with pandemic. Article clearly lists walmart labs specifically under "Before the pandemic.."
hogFeast 6y ago
This is still very shallow thinking. Every company that views tech as a cost rather than a way to generate revenue will invest in these contracts/offshore centres, and that is the noose round their neck. In most cases, but not all, hiring consultants suggests you don't understand enough about your own business to manage it yourself (insert image of senior executive trying to work out the Zoom so they can check their staff aren't slacking off like their damn nephew, useless kid, thinks he knows everything). The cost advantages really aren't that large either...sure, the staff cost less but they hire 10x more staff, they are slower, and when the requirements change you are done for. Btw, some places are very good for outsourcing (Russia, Ukraine, Poland, Belarus) but India is definitely not one of them imo...which is bizarre given how many engineers, prevalence of English, etc.
- learc83 6y ago
  >Btw, some places are very good for outsourcing (Russia, Ukraine, Poland, Belarus) I've had just as many problems working with outsourcing firms in Russia and Ukraine as I have with Indian firms. And I've had the same problems working for companies that tried to hire very cheap US based developers in house. I think the problem occurs whenever developer cost is your primary metric.
  - coldcode 6y ago
    It's not where you outsource to its the mere fact of paying people who don't work for you or care for more than billable hours (at least the leadership if not the consultants too). You can get that down the street too, though it's easier to check up on what's going on. Having employees you vetted/hired overseas is way different than hiring some firm to provide bodies who are unknown to you and come/go all the time.
  - hogFeast 6y ago
    True. My point was more to highlight that I don't actually have a problem with work being outsourced to another location. You are correct, when cost is the issue that creates incentives that tend not to work.
- 6y ago
deleted 6y ago
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_the_inflator 6y ago
It boils down to the Business Model. Having worked extensively with the major Indian vendors, with people from India in different settings, onsite and offshore, I observed that they simply focus on labor costs in Europe and elsewhere. Salespeople tried to sell us dozens of teams with “cheap” developers of every skillset we wanted. But that is not how software is done. I want outcomes not masses. I need creativity to work on tools expressed through software not cheaper developers. I felt sorry for my Indian dev friends that the true value of these folks was left off the board. Salespeople always tried to solve a problem with another “cheap team”. Enter SaaS...
- oneplane 6y ago
  I've talked with a lot of different Indian and similar 'offshore' engineers, developers and managers and most of them ended up in the place they did due to choices between being a farmer or being an IT person, being in a poor province vs. being in a less-poor province, and being able to support your parents. Almost none of them had an upbringing, background or base passion for technology or IT in general. While you can in theory do your IT things with no passion at all, and kill all creativity and still be productive, it often ends up being just 'mass' like you describe, a transformed version of the classical western 'consultants' that usually end up being companies that focus on sales and billable hours and never really deliver what the people needed (referring to earlier HN posts about accenture and deloitte). I get that at some point all companies converge on the same generic point of being in the business of making money at all costs, and making it 'measurable' via sales, hours and contracts. It doesn't matter if it's software, financial, legal etc. At least not to them at that point. The bigger problem with this is that the IT systems are not as well defined or a closed system as the other examples might be. A ledger would be simple to verify in comparison: you apply a fixed set of rules to a fixed period of data and it must result in something within a known range. With software you can do a little bit of determining that the 'borders' of your 'box' of functionality would be, but to do an exhaustive verification is so far from profitable that it's only done in a few highly regulated systems like flight controllers. So now we have a system where a lot of money and power vectors are involved that would (somewhat) work for legal and finance and the likes (i.e. the classical big ones that existed long before software did) and a constant attempt to apply it to IT and hide everything they don't like about getting the wrong results. It still eats resources like the other kinds of work, but doesn't produce the results you would expect for the resources that went in to it. Software doesn't operate in a vacuum, disconnecting users, buyers, sellers, or stakeholders in general is bad for everyone and because of endless change and interaction the whole model of 'buying a product' hasn't been realistic since 2000, and with connected OT (think SCADA and the likes) it won't even apply to embedded systems anymore.
zabil 6y ago
Major IT companies in India get a lot of revenue from maintainence projects and there is usually no scope for making major changes or innovating there. The time and material billing for these make it quite attractive from a revenue point vs fixed bid greenfield projects. I don't think that situation will change anytime time soon as along as these companies stick to services.
- baybal2 6y ago
  Yes, one word to say — JAVA. It's pretty much, the one and only thing that keeps enterprisey software maintainance people occupied. Thought, the Java is finally on decline on the backend. Android is pulling Java devs from enterprise, and cheaper to use languages displace Java there.
  - dclusin 6y ago
    Java’s still going to be in use long after we’re both dead.
    - kbrisso 6y ago
      This is so very true. I just migrated a 17 year old Struts 1.* app with most of my team in India from Weblogic to Tomee. It's a mission critical application with 400 users during business hours. It's not going anywhere anytime soon.
  - noble_pleb 6y ago
    Not just Java, there is a lot of old Microsoft tech floating around too. VB6 and old versions of .NET and MSSQL are still common in many enterprises.
  - jen20 6y ago
    > Thought, the Java is finally on decline on the back Is there any evidence this is actually the case?
  - deleted 6y ago
    [deleted]
Trias11 6y ago
These obese sweatshops are getting what they deserve.
- Proven 6y ago
  Except that people who work there (like anywhere else) can't find a better job. And like everywhere else most of them do their best. What does your wishing them to be worse off say about you?
entha_saava 6y ago
As an Indian there are reasons you can point out for this. Education: Engineering syllabi are pretty outdated. And due to a work-just-enough-for-month-end-salary mindset, professors are against being up-to-date. As a result, everywhere but in top notch colleges, quality of teaching is piss poor. The "Rat Race": There is no better word to describe this. 90% of people who enter computer science / engineering courses don't have any interest in computers. They enter because they scored well in entrance exam (which can be games by studying some books relentlessly for some years), and since Software is still one of the highest paying fields. And quite some of them continue their relentless pursuit for a good "package" by grinding Hackerrank / leetcode. It is literally a rat race. The same mindset will create an impression that being a manager is superior to being a programmer. Because you are "managing" people. These people do all kind of office politics to become manager, and spend rest of their life ruining someone else's life. You can't expect these kind of people to love their job or even do it properly. Hierarchy: Related to above point, in India, you don't oppose or even question an upper officer or elder's decision, because ELDERS ARE ALWAYS RIGHT HERE IN INDIA. That's why so many people want to be manager. Lack of interest in improving education: In many Indian engineering colleges, one year is wasted teaching theoretical subjects like chemistry and physics. No computer science related subject except basic C Programming (Lol not even malloc() and free()) are taught. This appears to be purely done in order to provide jobs for people who had studied these subjects. While teaching these subjects may have marginal benefits, they are outweighed by pure rote learning oriented assesment sysem and wasting one year of CSE programme. That's a bad trade-off for someone interested in CS. All entrance exams are based on Math/Physics/Chemistry and we have learnt enough of that. STOP the old age tradition. If the chemistry they teach in last two years of high school (called pre university here), which is quite high level, qualifies for entrance exams, Computer Science should too. No I am not telling this because it is a programmers forum. But CS taught in pre-uni (optional subject) is more essential and often more helpful than chemistry and half of physics taught to these grades. But chemistry is compulsory for some legacy reasons. There is no interest to change that.
- blocked_again 6y ago
  Your generalization of Indian colleges is not right. India has a lot of Engineering students. There are around 60k students joining Tier 1 colleges every year in India (IITs, NITs, etc funded by the Central Government alongside some private colleges like BITS). Very few students from Tier 1 colleges join these consultancy companies. Most of them studying CS from these colleges join product companies like Flipkart, Swiggy, Paytm, Amazon, Microsoft, Uber etc. Consultancy companies get students mostly from 2nd and 3rd tier (mostly private) colleges. Pretty much all these colleges are in a very bad shape. I think there are over half a million students enrolled in these colleges every year. Students still go to these engineering colleges since the education is not as expensive as in the USA and it's what pretty much everyone do after high school. If it was USA they would have just left college altogether instead of wasting money on a terrible college. Sure, the quality of education of Tier 1 colleges can be improved a lot as well. But generalizing the entire Indian engineering education as the reason why these consultancy companies are doing poor is not correct either.
kumarski 6y ago
I have a team of 14 engineers in Pakistan. It wasn't always easy to do this and now I always feel at odds with hiring where everyone else is hiring or paying a premium for a western passport developer when I know I can get killer talent elsewhere. I feel the talent we have now has the ability to crush, kill, and destroy the talent in Silicon Valley "engineers" at a fraction of the price in terms of output to input ratio. We've done work on crazy levels of core infrastructure and are scaling. The "catch" is that we have to do over-documentation, lots of screenshots, and consistent routine communications. My CTO and cofounder speaks 4 languages. The talent has to be managed. Within 12 months of being with us, a Pakistani developer has massively increased their value. We also don't bring anyone into core leadership team onshore unless they speak at least 2 languages or more or they have a serious edge in terms of talent. The developers who complain about Indian and Pakistani developers are usually: - Unilingual - have been over-resourced in every position they've ever been in - poorly travelled - are used to working with onshore talent that has context - find the time difference to be abhorrent Right now, our core "mission critical" team speaks 4 languages. I fully hope to add 10-20 languages as we expand. I'm hoping for Turkish, Arabic, Georgian, Russian, Ukrainian, Polish, Spanish, and Portuguese in that order... You cannot expect someone who has 10-14 times less electricity/capita to suddenly have the context of an American. It takes time. We pay for the entire floor of a building in Pakistan, have cameras, etc... remote now is a core part of our tech biz.
- kirubakaran 6y ago
  > We pay for the entire floor of a building in Pakistan, have cameras, etc Good post, upvoted, but why the cameras?
  - kumarski 6y ago
    Oh for video conference calls so the video resolution is high/kosher. Not for "surveillance."
- danpalmer 6y ago
  Thanks for this, it's a great counter to the common thinking here. It seems that most of the market just does it wrong when they outsource. They either assume that the outsourced resource is a black box that produces finished products/closed tickets/etc, or they assume that the people on the other end are like a western developer in terms of background/education/culture/language/career path/goals. What it seems you've done is treat these engineers as first-class employees in your company. For a new starter you'd provide training, context, you'd have ways to get them up to speed, you'd invest in processes and communication to make a separate office or timezone difference work. Congrats, well done. I'm not surprised that you're finding the results to be so good! It's a shame more companies who outsource don't recognise that this level of effort is necessary.
josephjrobison 6y ago
As a marketing person, I've learned the hard way over the years that I'm not qualified to hire outsourced development. I've hired about a dozen over the years, and only 1-2 have been a good experience. I probably gave myself too much credit for knowing HTML/CSS/WordPress and not more, thinking I was qualified enough. Only a good to great web developer has the expertise to spot high quality outsourced talent, and ignore the other 90%. The fault is mine for thinking I had the skillset to hire in a field in which I'm not an expert. It's the same with any field, actually. Marketers bemoan all the time when companies hire a cheap, bad SEO, but you have to feel sorry for the hiring party that was making what they thought was a value decision, even though they were not a practitioner expert. Zooming out, you can see how decisions are made at a massive scale based on the hiring party making the decision based on the sales team or personal business relationships, while not being the subject matter expert.
deleted 6y ago
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azpekt 6y ago
I was (and currently still) working for such a company in US. Their business model is to sell you bodies. That’s it.
ilikerashers 6y ago
I'm not sure I'm bought into this. I consulted at a big bank and am currently at a government department where I can see the in-house trend reversing. 10 years ago there was a big backlash against outsourcers and tech moved to "Agile" delivery and shiny AWS. Companies started investing believing they were being left behind. We're going through a low point in the hype cycle right now. Blockchain/AI/Data science have all been a bit disappointing for Enterprise. Much of the mobile revolution passed them by too! Cloud is a bit pricier than expected and keeping on top of trends (CloudFoundry/K8S) has been exhausting for in-house staff. Outsourcing is great for handle-crank, cheap IT and that's not going away. Also, why is Saas being frequently mentioned as a solution here? Enterprise system complexity is not very Saas friendly.
- heisenbit 6y ago
  Yes, if enterprise systems were easy SAP would have cornered the market long ago. Or Oracle for that matter. One of the most valuable experience in my education was being forced to write a review and discuss in class ‚There is no silver bullet‘. Better tools will not stop the flow of new requirements. And being good enough for todays business does not stop your competitor trying to outmaneuver you. The dynamic may change once silicon progress has slowed down but until then it will be risky to stop innovating.
ThePadawan 6y ago
I have been keeping my ear to the ground in the local job market (Switzerland) and personally haven't encountered any company that outsourced to India specifically. Most popular are Eastern Europe (Serbia, Ukraine, Romania) and Asia (Vietnam). The """savings""" multiplier is still in the order of 3-4x, but time zones work out better. I am however, still baffled how this happened after seemingly every company made the discovery that outsourcing too much of your business doesn't tend to work out (20 years ago, during the last boom). I also talked to several companies that were willing to trust their outsourced teams to work remotely, but not the staff located in Switzerland (who once again have to come to the office during the pandemic).
burntoutfire 6y ago
These consultancies may also finally reap what they sow re: quality of work. I work in a major bank and some senior managers say they'd rather get the plague than a team of those guys. The managers need to deliver what they promised to their higher ups, and they've learned that these teams, however cheap they are, in practice will not help them with that. Btw these companies still manage to get some business with us, which I suspect is to some degree helped with bribes.
afrojack123 6y ago
Indian IT consultancies have been struggling against technological obsolescence for 30 years. And they will continue to struggle for many more. This is an idiotic hit piece hit written by a journalist who needs to meet his quota. This journalist has never worked for one of these consultancies, a tech company, or been in C-suite of any org. I have worked in these "consultancies" so here is my take. There is a wide range of talent in these consultancies. Some examples are web app developers/software engineers, website people, implementation engineers/enterprise app software, supply chain, cybersecurity, etc. Yes, unfortunately, some of this talent is not familiar with basic software tooling like basic linux commands or git or setting up a path variable. This sounds really bad until you work with a Georgia Tech computer engineering grad and realize he doesn't know this either. Many methods of sales. A sale can be considered a billion dollar deal or having a director hiring a contractor. The billion dollar deal is closer to consulting. The director hiring a contractor is closer to professional services firm. Prior to these consultancies, the orgs would hire their own employees and train them. What changed? Contractors easier to layoff than W-2 employees. Maybe their own employees didn't have the expertise. The truth of the matter is for most organizations, IT is a cost center along with legal and finance. It is not their money maker. They have no interest in innovative IT/software "technology" until their competitor in the same industry as them has it. Price matters. Laying off people easily matter. "Consultancies" exist for that reason. Look past their marketing/branding and their official classification is a professional services firm.
- rafiki6 6y ago
  > The truth of the matter is for most organizations, IT is a cost center along with legal and finance. It is not their money maker. They have no interest in innovative IT/software "technology" until their competitor in the same industry as them has it. Price matters. Laying off people easily matter. Accurate and poignant. Having lived in the banks for a while, this will always be the case in industries. They don't give a shit if you have a passion or about your career. They want you to be a "xyz developer with 50 years of experience". Sometimes I think we forget how the real world works when we are enamored with the cool things computers can do.
  - 6y ago
Brajeshwar 6y ago
To set context, I'm Indian. I used to work for Razorfish for about 2 years, working with our counterparts in London, Austin, and San Francisco. I ended up building a team of 50-odd Products Designers and Front-end Engineers in about a years time. So, We used to work with lots of "engineers" from well-known other Indian Outsourcing firms. Here are few anecdotes; Even amongst themselves, they don't respect each other individuals and teams. The Indian team in Singapore/Bangalore/San Francisco will called the Chennai/Other-Locale team as their outsource partner/team and are mis-treated. I was like, "I thought you guys were team!" In another incident, I once lambasted a "tech-team" of a really well known India company for not even knowing how to push codes to git. I patiently explained to the team on how to work collaboratively and to push codes, send in pull request and not to email us zip files of their codes. Their head of something-something (too many senseless designations/titles) was not happy and in his mistake, sent a "Reply All" to the tune of, "Any email from Brajeshwar should not be replied immediately, call a meeting with the tech heads." Well, I was kinda referred to someone who should be sent in when shits stars hitting the fan. ;-)
- yawaramin 6y ago
  Can confirm, I worked for Publicis Sapient (formerly SapientRazorfish) for a bit and heard some horror stories about consultant firm software devs. (Ironically enough, SR/PS is a consulting firm too...)
  - ajo_mathew 6y ago
    Depends on managers and who pulls for what work. Western companies take all the great work and push down to Indian firms not interesting work, some dumb enough managers will bow to client( bootlicker ) without much of know how take that job and come to us. I worked in MNC and Startups seen my fair share of so called types of projects/managers.
- rememberlenny 6y ago
  I had the same experience in Shanghai with a similar top tier agency. I was hired by a Fortune 500 apparel brand to be their digital project manager to handle the agency and Q/C deliverables. It was 2013, but even then I was blown away by the extent to which the engineers on their end didn't use any modern version control. All of the deliverables were send over FTP updates, and zipped file directories.
la6471 6y ago
This feeble attempts to generalize a whole nation or group of people will not succeed. Individuals differ from one another and Indians are the most diverse group in the world. Some of the engineers are good some are bad , just like everywhere else. The sooner humanity realizes the truth about individuality and discard the stereotypes attached to groups and aggregates the better it will be for the whole world. Amen.
- goatforce5 6y ago
  > and Indians are the most diverse group in the world What metric(s) are you using to measure that diversity? I live in Toronto, Canada, and approximately 50% of residents here were born overseas. Toronto likes to boast it is one of the most diverse cities in the world (based on that metric, at least).
  - throwaway0648 6y ago
    They're probably using this list https://en.wikipedia.org/wiki/List_of_countries_ranked_by_ethnic_and_cultural_diversity_level https://en.wikipedia.org/wiki/List_of_countries_ranked_by_et... And you are probably using this one https://en.wikipedia.org/wiki/List_of_sovereign_states_and_dependent_territories_by_immigrant_population https://en.wikipedia.org/wiki/List_of_sovereign_states_and_d... So it depends what you mean by diversity
  - elongatedMusku 6y ago
    Well we have more than a hundred languages in India. A lot of them look very different to each other if you are looking for skin color. There are east Indians as well who look Asians.
  - mahastore 6y ago
    Diverse in terms of religion food habits culture race and of course language. Over the course of human history India has been a melting pot of people coming from all over the world.
- 0pranav 6y ago
  As far as I read the article, it seems to address the Indian consultancy companies rather than Indians as people.
ramshanker 6y ago
TLDR of the article is American / European companies creating in-house Indian offices and moving away from "consultancies". I whole heartedly agree to the huge advantages you get doing this. You have better control over hiring quality talent, more focused developers who develop institutional knowledge over time, much easier to scale up/down than the contracts with these consultancies and so on..... Outside IT, I can confirm the same tree has been happening from my industry of Oil & Gas consultancy. Many American / European oil & gas consultancies now have Indian engineering centres employing chemical / mechanical / civil / electrical / instrumentation engineers. It is easy to setup this over here. Everyone is welcome.
- aszen 6y ago
  Being a part of one of these, I agree most companies have realised have a dedicated offshore team is much better than assigning work via third party consultancies. If anyone is struggling to hire in their local market definitely try to get in touch with talented people offshore and see if they can bootstrap a small development team to help your business. Also it's not always about cost cutting, sometimes businesses struggle to find developers working on their technology platforms or just lack the pull to attract local talent. In these cases if you invest in an offshore team and help them learn about your business needs it will pay off in the long run.
jorblumesea 6y ago
Pretty much what everyone in the tech industry has been doing for years. Better to have your own overseas office where you can control the hiring bar and talent vs making consultancies rich. The big consultancies are more concerned with draining value from clients and treating them like cash cows instead of delivering value. That being said, probably the real solution is SAAS.
Abishek_Muthian 6y ago
It was far much worse, now the major consultancies are on rapid re-skilling drive, also they have made significant changes to their pricing strategy to their clients and are not just based on head count. But the criticism of technological obsolescence cannot be just levelled against these consultancies alone, much like how almost every electronics hardware was(is) is manufactured in China due to cheap labour costs, so was the reason behind extraordinary growth of Indian IT services and so it all comes down to 'What the client wants'. But when their client suddenly wanted to catch up on the AI/ML/Analytics bandwagon, these consultancies understood the need to revamp their skilling strategy. That said, it's not like these consultancies never innovate they have dabbled with large in-house products ranging from cloud to automation and some have been fairly successful e.g. TCS ignio, their (AI in air-quotes) automation product[1]. End of the day, they get the job done for their clients which includes almost every major Bank, Retail, Pharmacy to even Aerospace industry like Boeing (Only green card holders/US citizens are employed), Automobile - Ferrari, Cyber Security etc. also saving huge amount of money for them in the process. [1]https://digitate.com/ignio-aiops/ https://digitate.com/ignio-aiops/ (Warning: Marketing fluff).
random314 6y ago
Thanks. Grammar check - its note "codes"; it is "code".
- klodolph 6y ago
  Wrong—“codes” is correct in the Indian dialect of English. This is akin to arguing over whether “color” or “colour” is the correct spelling.
  - krapht 6y ago
    It's also, for some reason, what people say in scientific computing.
  - senkora 6y ago
    Is it like fish and fishes? fish = plural for many of a single kind of fish fishes = plural for multiple kinds of fish So by analogy: code = any amount of code from a single project codes = plural for code from multiple projects I'm American and this is how I use code/codes, so I'm curious whether you make the same distinction, or if you always use codes.
    - andybak 6y ago
      Brit here. It's always "code" and "codes" sounds like something a non-technical middle manager would say and get sniggered about behind his back.
    - eloisius 6y ago
      Sounds like saying “the sands from beaches around Florida” to pluralize code to me. How much is a single code?
    - klodolph 6y ago
      I’m American, this is just my take on it. I don’t think fish / fishes is quite right. Look up “code” in the dictionary and you get at least two different senses of the word: 1. System of substituting letters/words/symbols/etc. for letters/words/symbols/etc, e.g. “morse code”. Countable noun. 2. Computing program instructions. Uncountable noun. This is not like fish / fishes, because “fish” is countable—I can have one fish or two fish. When talking about computer programming instructions, I cannot have one code or two codes, but I can have one line of code or two lines of code. Just like I cannot have a bowl of one thousand rice, but I can have a bowl of one thousand grains of rice. Rice is “uncountable” in the grammatical sense even though it seems like you should be able to count it. In Indian english, my understanding is that for the second sense above, “codes” is correct and “code” is incorrect. In that sense it is probably similar to “data”, in the historical usage where “data” was plural (in modern usage, “data” is often considered singular). So, “The codes are on my hard drive.” makes sense to Indian english speakers, and “The data are on my hard drive.” makes sense in historical (say, early 20th-century) English. There is a singular version of data, “datum”, but rarely used.
neonate 6y ago
https://archive.is/yNKSj https://archive.is/yNKSj
- rramadass 6y ago
  Thank you!
ktrl 6y ago
They should have seen this coming. The big Indian IT consultancies have existed since the 1980s and they have been swimming in billions since the early 2000s. They should have invested into actual product development at least a decade ago.
alexpotato 6y ago
I forget where I heard this quote but I think it summarizes the whole "outsourcing as a boondogle" scenario: 1. A good development team in the US/Europe costs $X 2. An equivalent team in not the US/Europe costs 75% of $X 3. A terrible team in not the US/Europe costs 25% of $X Most outsourcing decisions instead of stopping at Option 2 and enjoying the 25% savings, got greedy and went full bore to Option 3 and thought themselves geniuses.
naruvimama 6y ago
Just judging from the title it sounds silly. Last I remember while working at one of the companies between 2006-2008, COBOL & mainframes was a good chunk of their work. Obsolescence is their bread and butter. I do agree they do have a lot of wrong and toxic people running middle management along with short term thinking. But that is partly due to their business model, a business model that gave the best returns.
- Cthulhu_ 6y ago
  Nail / head I think; a lot of western devs, especially the HN crowd, has the luxury of moving to the next 'cool' thing every couple of years. But they did write code, they laid the groundwork, and it has to be developed further on. Billions of LOC of Java are lying around and there is a need for an army of developers to look after it.
naruvimama 6y ago
You can get very good developers from these companies, and you can get it in volume, you just need to insist on it. When you ask for Sr.managers, 2xmanagers, 2x Asst. Managers, 2x Business Analyst (with MBAs). You are quickly adding up costs for non-functional heads. The only way to remedy that is to go cheap on developers and bloat their numbers to match the overhead.
marjann 6y ago
I believe there is a bias towards the outsourcing, at least judging by the comments. Let me tell you my side of the story. We are a software development company based in Macedonia - Emit Knowledge From personal experience, we've refactored/rewritten code that was developed by development teams from USA, Canada, Sweden, Denmark, UK where the hourly rate is sky high compared to ours. According to me the problem is not in the outsourcing itself, but rather in the company size and culture. Bigger companies tend to have stronger sales teams, getting whatever is in their way, closing deals without having expertise and know-how. The only driving factor is how to maximize profit. Hire less experience devs, leave the SRS so you can charge CRs and that kind of doctrine. On the other hand, I can tell that we as a company have better processes than bigger companies: - having our own framework: https://signals.emitknowledge.com/ https://signals.emitknowledge.com/ soon to be open sourced; - having multiple products, which you will find as rarity when it comes to agencies; - having an research and development; - before we start working with a client, the agreement is that it is a two sides stick, the client needs to be part of the development if success is expected; - regular communication is a must; - we discuss with the clients to reduce scopes if we identify that it will increase costs without providing a business value at the end; The difference is in the culture. As a CEO I would like my client's business to succeed so we can work together as partners, long terms, instead of getting money from CRs and playing "you haven't specified this". Be transparent guys. Stop playing games with your clients. You need to give in order to get.
- hashhar 6y ago
  > The difference is in the culture. As a CEO I would like my client's business to succeed so we can work together as partners, long terms, instead of getting money from CRs and playing "you haven't specified this". I think this is the part that's most important and similar to how orgs like RedHat operate.
ycombonator 6y ago
https://www.tcs.com/business-4-0/report/behaviors-digital-transformation https://www.tcs.com/business-4-0/report/behaviors-digital-tr... Just read this and tell me if any of this makes sense. I read it 10 times and couldn’t figure out what is the value they are bringing.
api 6y ago
From what I've heard, programmers that are as good as domestic (US/EU) programmers can absolutely be hired in India and lots of other places. Problem is they are not significantly cheaper than domestic programmers once you add management overhead and then compare the result against equally skilled domestic programmers in lower cost of living places in the US/EU. It's more practical and may be no more expensive to hire someone good in West Virginia, Kentucky, or Michigan where rent or mortgage payments and many other expenses are quite a bit lower than they are in big coastal cities.
babaganooj 6y ago
Cisco's IT is almost 100% Indian, and by almost 100% I mean I've only seen one or two out of thousands who weren't Indian. Cisco's Indian IT department managers having exclusive preference for Indian companies. It's so against the law for Cisco to have their IT department almost fully staffed by H1B visa holders who work for some Indian outsourcer and are themselves all Indian. The work they do is only half decent (well, not really, it's purely best effort, and depends on the individual or team doing the work it can vary dramatically) The CEOs of many of the Indian outsourcers are so incompetent and focused so exclusively on relationship based selling that it's pointless to even bring up the topic of them falling behind the tech adoption curve. It's a giant heap of incompetence and corruption.
opportune 6y ago
I think you can be successful outsourcing to WITCH or other consultancies IF you have an in-house, full-context software engineer managing the project and keeping people accountable. You have to be careful because if you ask for someone who is "an expert in X technology", you'll definitely get someone, and they might be able to describe it at a high level, but may not even know how to compile a program or how to copy a file (yes I have literally seen this firsthand). You need to give people explicit instructions and be willing to help, and the in-house software developer almost definitely needs to provide things like architecture/spec. And you need to actively fight the need to increase the staffing for the project and prevent dumb/churn processes from taking over (example: writing 40 different scripts (separately!) to do something that could just as easily be done by one script with three parameters). And you need to manage the project into a position where maintenance/ownership can be transferred. You also need to set them up for success by having a clearly defined scope and playing towards their skills (which means, don't give them work that needs a ML PhD math genius, do give them work like "write a PHP website that does this and looks kinda like that"). This is part of what I think the article is missing but also not really a fair expectation of what an outsourcing firm is. Consultancies are not meant to come up with 'killer apps', and you can try to pay them to do so and they'll be happy to take your money, but you shouldn't.
shash 6y ago
It’s easy to tar the entire Indian IT industry with the same brush, but it’s a much richer ecosystem than just the Big Five. For example, I work in a small product based company in a niche segment where we’re among the very few people who can provide the solutions we can, and I’d happily pit my colleagues’ skills against the best of SV. Keep in mind that this article is only about the Big Five. They have a certain business model, a value proposition and a set of clients whom they service. A particular niche that’s been very lucrative and productive for them. This, as the article says, may be drying up. But that doesn’t mean that Indian IT as a whole, or even most of Indian IT is in trouble.
- ntsplnkv2 6y ago
  It won't dry up that quickly. As long as customers still use SAP and Oracle it will be a long while. The problem with enterprise software was never the technical details - it was getting archaic, inefficient business processes in systems that didn't support those processes. This doesn't change with SaaS. Extension tools have gotten better but the core problem still exists. So many customers still use on-prem SAP hosted in the cloud. The end result is the same requirement for everything but sysops.
known 6y ago
Indian IT consultancies make money by selling Software Engineers, not Software to US/EU;
known 6y ago
https://archive.is/yNKSj https://archive.is/yNKSj
desaiguddu 6y ago
I run a boutique consulting studio in India. Indian outsourcing /offshore teams are beyond Infosys, TCS, Tech Mahindra, Wipro etc. There are design & engineering teams who deliver amazing value to their clients. These teams are nimble & specialised.

299 points by one_electron 6y ago

deadalus 6y ago

https://archive.is/j7xRa https://archive.is/j7xRa

abrolhos 6y ago
Thank you!

ETHisso2017 6y ago

I wonder what GPT-3 will do to their business models

yourapostasy 6y ago
Not sure about the business models, but it might generate pseudo-translations of the same article, like this: https://www.news98.info/indian-it-consultancies-wrestle-towards-technological-obsolescence/ https://www.news98.info/indian-it-consultancies-wrestle-towa... My eyes bled trying to read that hash.

the-dude 6y ago

There is little substance in the article. Biggest point made is that enterprise software is easier to administer and use. I feel they entirely missed the elephant in the room : SaaS.

pwarner 6y ago
Yes, SaaS and even IaaS and PaaS are the ultimate outsourcing. Outsourcing that actually works since it's not simply swapping a US based high paid human for a low paid off shore human. Instead it's swapping a human for automation, that's real savings for customers, even after margin for the automation creator.
nmstoker 6y ago
I certainly feel the article could have made more of their central points, which were mainly anecdotal / common sense. This is the part I'd like to have seen more proof and analysis around: "the Indian giants have also been unable to keep pace with technological change. Corporate software is becoming easier to use, reducing demand for their services. The lucrative legacy business of running mainframes is evaporating. Helping clients shift to the cloud makes money but not nearly as much."
pm90 6y ago
Yep, SaaS is the real outsourcing killer. And the future seems to be one where even more infrastructure is abstracted away i.e. Serverless/PaaS. This is changing the way software is built and tested. Its empowering people who have been through coding bootcamps to start delivering value.* * please note that I have nothing against coding bootcamps, the point is that most graduates of these bootcamps are by definition very new and green to Software Development.
JAlexoid 6y ago
They haven't. What do you think "cloud" is? (I'm a subscriber, I read the full article)

mjohn 6y ago

I recently joined a company where my main task is to modernise a business critical application built and supported by Wipro over ten years ago. Everything is still on .Net 3.0 (first released in 2007), and despite hundreds of pages of documentation the developers seem to have little understanding of what the application actually does for the business. The impression I have is that their business model is geared towards building one thing, learning one technology, and then exploiting it for as long as possible with minimal evolution. This is fine if you don't need the software to evolve, but most business applications do need to evolve even if slower than at a start-up or FAANG. At least where I work there has been the recent realisation that outsourcing all your technology means you will struggle to iterate and improve that technology.

runawaybottle 6y ago
Here’s the thing, I honestly think these consultancies are going to be feasting for decades to come with all these enterprise companies shifting to the cloud. That is the very definition of ‘their business model is geared towards building one thing, learning one technology, and then exploiting it for as long as possible with minimal evolution.’. This kind of lock-in at the enterprise level is a dream come true for them. They can marshal armies of AWS certified architects, and tie themselves to every corporation in the world, forever.
- yourapostasy 6y ago
  I dunno, it could go either way. AWS is not cheap, unless you really understand the business domain, or someone else has done the hard work of understanding the business and re-architecting the design to leverage AWS' value propositions. It is painful to watch a team that doesn't understand what is really going on blindly rip and replace on-prem VM's with EC2's that only need to for example, run a script once a day to perform an extract and load operation in a few minutes. Even when you run pico instances, applying the same design culture across the enterprise adds up in a big hurry. This isn't Indian or non-Indian, this is "whether they deeply care about the customer enough to look for innovation on your own". You can't agile your way to nor bottle up and sell by the caseload innovation. I wish like hell we could, I'd buy a Panamax-load of that and mainline it into the fusion and AGI problems. What jrumbut said in this thread has some validity in certain scenarios, "Outsourcing turns an investment opportunity into an expense." And like the-dude said, the initial innovation is the automation behind aaS. It is up to those who build on top of aaS to carry that innovation momentum forward by adding their own innovation, the innovation isn't transitive nor inheritable by just using *aaS, which seems to be happening a lot currently though that is changing at an accelerating pace.

MattGaiser 6y ago

Isn't this also true of IBM? All these consulting firms have an expensive business model which is increasingly no longer useful.

raverbashing 6y ago
I'm sure IBM and other companies get a non trivial amount of checks with a lot of zeros each year for supporting legacy applications/systems/etc with barely any work involved on their part besides maybe running Make again once in a while. And to be fair, some companies are not even wrong because rewriting is still more expensive than just paying for maintenance.

geogra4 6y ago

Well, at least from where I sit they're still getting plenty of business as with the apparent sun-setting of the H1-B program companies are just hiring offshoring firms instead.

dominotw 6y ago
> with the apparent sun-setting of the H1-B program companies are just hiring offshoring firms instead. Are you speculating here or have seen an actual trend out there?
- deleted 6y ago
  [deleted]
- JAlexoid 6y ago
  The article mentions that big corporate tech departments are just moving their operations to Indie - like Walmart has Walmart Labs in India, despite having no retail business there.
  - dominotw 6y ago
    That has nothing to do with pandemic. Article clearly lists walmart labs specifically under "Before the pandemic.."

hogFeast 6y ago

This is still very shallow thinking. Every company that views tech as a cost rather than a way to generate revenue will invest in these contracts/offshore centres, and that is the noose round their neck. In most cases, but not all, hiring consultants suggests you don't understand enough about your own business to manage it yourself (insert image of senior executive trying to work out the Zoom so they can check their staff aren't slacking off like their damn nephew, useless kid, thinks he knows everything). The cost advantages really aren't that large either...sure, the staff cost less but they hire 10x more staff, they are slower, and when the requirements change you are done for. Btw, some places are very good for outsourcing (Russia, Ukraine, Poland, Belarus) but India is definitely not one of them imo...which is bizarre given how many engineers, prevalence of English, etc.

learc83 6y ago
>Btw, some places are very good for outsourcing (Russia, Ukraine, Poland, Belarus) I've had just as many problems working with outsourcing firms in Russia and Ukraine as I have with Indian firms. And I've had the same problems working for companies that tried to hire very cheap US based developers in house. I think the problem occurs whenever developer cost is your primary metric.
- coldcode 6y ago
  It's not where you outsource to its the mere fact of paying people who don't work for you or care for more than billable hours (at least the leadership if not the consultants too). You can get that down the street too, though it's easier to check up on what's going on. Having employees you vetted/hired overseas is way different than hiring some firm to provide bodies who are unknown to you and come/go all the time.
- hogFeast 6y ago
  True. My point was more to highlight that I don't actually have a problem with work being outsourced to another location. You are correct, when cost is the issue that creates incentives that tend not to work.
6y ago

deleted 6y ago

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_the_inflator 6y ago

It boils down to the Business Model. Having worked extensively with the major Indian vendors, with people from India in different settings, onsite and offshore, I observed that they simply focus on labor costs in Europe and elsewhere. Salespeople tried to sell us dozens of teams with “cheap” developers of every skillset we wanted. But that is not how software is done. I want outcomes not masses. I need creativity to work on tools expressed through software not cheaper developers. I felt sorry for my Indian dev friends that the true value of these folks was left off the board. Salespeople always tried to solve a problem with another “cheap team”. Enter SaaS...

oneplane 6y ago
I've talked with a lot of different Indian and similar 'offshore' engineers, developers and managers and most of them ended up in the place they did due to choices between being a farmer or being an IT person, being in a poor province vs. being in a less-poor province, and being able to support your parents. Almost none of them had an upbringing, background or base passion for technology or IT in general. While you can in theory do your IT things with no passion at all, and kill all creativity and still be productive, it often ends up being just 'mass' like you describe, a transformed version of the classical western 'consultants' that usually end up being companies that focus on sales and billable hours and never really deliver what the people needed (referring to earlier HN posts about accenture and deloitte). I get that at some point all companies converge on the same generic point of being in the business of making money at all costs, and making it 'measurable' via sales, hours and contracts. It doesn't matter if it's software, financial, legal etc. At least not to them at that point. The bigger problem with this is that the IT systems are not as well defined or a closed system as the other examples might be. A ledger would be simple to verify in comparison: you apply a fixed set of rules to a fixed period of data and it must result in something within a known range. With software you can do a little bit of determining that the 'borders' of your 'box' of functionality would be, but to do an exhaustive verification is so far from profitable that it's only done in a few highly regulated systems like flight controllers. So now we have a system where a lot of money and power vectors are involved that would (somewhat) work for legal and finance and the likes (i.e. the classical big ones that existed long before software did) and a constant attempt to apply it to IT and hide everything they don't like about getting the wrong results. It still eats resources like the other kinds of work, but doesn't produce the results you would expect for the resources that went in to it. Software doesn't operate in a vacuum, disconnecting users, buyers, sellers, or stakeholders in general is bad for everyone and because of endless change and interaction the whole model of 'buying a product' hasn't been realistic since 2000, and with connected OT (think SCADA and the likes) it won't even apply to embedded systems anymore.

zabil 6y ago

Major IT companies in India get a lot of revenue from maintainence projects and there is usually no scope for making major changes or innovating there. The time and material billing for these make it quite attractive from a revenue point vs fixed bid greenfield projects. I don't think that situation will change anytime time soon as along as these companies stick to services.

baybal2 6y ago
Yes, one word to say — JAVA. It's pretty much, the one and only thing that keeps enterprisey software maintainance people occupied. Thought, the Java is finally on decline on the backend. Android is pulling Java devs from enterprise, and cheaper to use languages displace Java there.
- dclusin 6y ago
  Java’s still going to be in use long after we’re both dead.
  - kbrisso 6y ago
    This is so very true. I just migrated a 17 year old Struts 1.* app with most of my team in India from Weblogic to Tomee. It's a mission critical application with 400 users during business hours. It's not going anywhere anytime soon.
- noble_pleb 6y ago
  Not just Java, there is a lot of old Microsoft tech floating around too. VB6 and old versions of .NET and MSSQL are still common in many enterprises.
- jen20 6y ago
  > Thought, the Java is finally on decline on the back Is there any evidence this is actually the case?
- deleted 6y ago
  [deleted]

Trias11 6y ago

These obese sweatshops are getting what they deserve.

Proven 6y ago
Except that people who work there (like anywhere else) can't find a better job. And like everywhere else most of them do their best. What does your wishing them to be worse off say about you?

entha_saava 6y ago

As an Indian there are reasons you can point out for this. Education: Engineering syllabi are pretty outdated. And due to a work-just-enough-for-month-end-salary mindset, professors are against being up-to-date. As a result, everywhere but in top notch colleges, quality of teaching is piss poor. The "Rat Race": There is no better word to describe this. 90% of people who enter computer science / engineering courses don't have any interest in computers. They enter because they scored well in entrance exam (which can be games by studying some books relentlessly for some years), and since Software is still one of the highest paying fields. And quite some of them continue their relentless pursuit for a good "package" by grinding Hackerrank / leetcode. It is literally a rat race. The same mindset will create an impression that being a manager is superior to being a programmer. Because you are "managing" people. These people do all kind of office politics to become manager, and spend rest of their life ruining someone else's life. You can't expect these kind of people to love their job or even do it properly. Hierarchy: Related to above point, in India, you don't oppose or even question an upper officer or elder's decision, because ELDERS ARE ALWAYS RIGHT HERE IN INDIA. That's why so many people want to be manager. Lack of interest in improving education: In many Indian engineering colleges, one year is wasted teaching theoretical subjects like chemistry and physics. No computer science related subject except basic C Programming (Lol not even malloc() and free()) are taught. This appears to be purely done in order to provide jobs for people who had studied these subjects. While teaching these subjects may have marginal benefits, they are outweighed by pure rote learning oriented assesment sysem and wasting one year of CSE programme. That's a bad trade-off for someone interested in CS. All entrance exams are based on Math/Physics/Chemistry and we have learnt enough of that. STOP the old age tradition. If the chemistry they teach in last two years of high school (called pre university here), which is quite high level, qualifies for entrance exams, Computer Science should too. No I am not telling this because it is a programmers forum. But CS taught in pre-uni (optional subject) is more essential and often more helpful than chemistry and half of physics taught to these grades. But chemistry is compulsory for some legacy reasons. There is no interest to change that.

blocked_again 6y ago
Your generalization of Indian colleges is not right. India has a lot of Engineering students. There are around 60k students joining Tier 1 colleges every year in India (IITs, NITs, etc funded by the Central Government alongside some private colleges like BITS). Very few students from Tier 1 colleges join these consultancy companies. Most of them studying CS from these colleges join product companies like Flipkart, Swiggy, Paytm, Amazon, Microsoft, Uber etc. Consultancy companies get students mostly from 2nd and 3rd tier (mostly private) colleges. Pretty much all these colleges are in a very bad shape. I think there are over half a million students enrolled in these colleges every year. Students still go to these engineering colleges since the education is not as expensive as in the USA and it's what pretty much everyone do after high school. If it was USA they would have just left college altogether instead of wasting money on a terrible college. Sure, the quality of education of Tier 1 colleges can be improved a lot as well. But generalizing the entire Indian engineering education as the reason why these consultancy companies are doing poor is not correct either.

kumarski 6y ago

I have a team of 14 engineers in Pakistan. It wasn't always easy to do this and now I always feel at odds with hiring where everyone else is hiring or paying a premium for a western passport developer when I know I can get killer talent elsewhere. I feel the talent we have now has the ability to crush, kill, and destroy the talent in Silicon Valley "engineers" at a fraction of the price in terms of output to input ratio. We've done work on crazy levels of core infrastructure and are scaling. The "catch" is that we have to do over-documentation, lots of screenshots, and consistent routine communications. My CTO and cofounder speaks 4 languages. The talent has to be managed. Within 12 months of being with us, a Pakistani developer has massively increased their value. We also don't bring anyone into core leadership team onshore unless they speak at least 2 languages or more or they have a serious edge in terms of talent. The developers who complain about Indian and Pakistani developers are usually: - Unilingual - have been over-resourced in every position they've ever been in - poorly travelled - are used to working with onshore talent that has context - find the time difference to be abhorrent Right now, our core "mission critical" team speaks 4 languages. I fully hope to add 10-20 languages as we expand. I'm hoping for Turkish, Arabic, Georgian, Russian, Ukrainian, Polish, Spanish, and Portuguese in that order... You cannot expect someone who has 10-14 times less electricity/capita to suddenly have the context of an American. It takes time. We pay for the entire floor of a building in Pakistan, have cameras, etc... remote now is a core part of our tech biz.

kirubakaran 6y ago
> We pay for the entire floor of a building in Pakistan, have cameras, etc Good post, upvoted, but why the cameras?
- kumarski 6y ago
  Oh for video conference calls so the video resolution is high/kosher. Not for "surveillance."
danpalmer 6y ago
Thanks for this, it's a great counter to the common thinking here. It seems that most of the market just does it wrong when they outsource. They either assume that the outsourced resource is a black box that produces finished products/closed tickets/etc, or they assume that the people on the other end are like a western developer in terms of background/education/culture/language/career path/goals. What it seems you've done is treat these engineers as first-class employees in your company. For a new starter you'd provide training, context, you'd have ways to get them up to speed, you'd invest in processes and communication to make a separate office or timezone difference work. Congrats, well done. I'm not surprised that you're finding the results to be so good! It's a shame more companies who outsource don't recognise that this level of effort is necessary.

josephjrobison 6y ago

As a marketing person, I've learned the hard way over the years that I'm not qualified to hire outsourced development. I've hired about a dozen over the years, and only 1-2 have been a good experience. I probably gave myself too much credit for knowing HTML/CSS/WordPress and not more, thinking I was qualified enough. Only a good to great web developer has the expertise to spot high quality outsourced talent, and ignore the other 90%. The fault is mine for thinking I had the skillset to hire in a field in which I'm not an expert. It's the same with any field, actually. Marketers bemoan all the time when companies hire a cheap, bad SEO, but you have to feel sorry for the hiring party that was making what they thought was a value decision, even though they were not a practitioner expert. Zooming out, you can see how decisions are made at a massive scale based on the hiring party making the decision based on the sales team or personal business relationships, while not being the subject matter expert.

deleted 6y ago

[deleted]

azpekt 6y ago

I was (and currently still) working for such a company in US. Their business model is to sell you bodies. That’s it.

ilikerashers 6y ago

I'm not sure I'm bought into this. I consulted at a big bank and am currently at a government department where I can see the in-house trend reversing. 10 years ago there was a big backlash against outsourcers and tech moved to "Agile" delivery and shiny AWS. Companies started investing believing they were being left behind. We're going through a low point in the hype cycle right now. Blockchain/AI/Data science have all been a bit disappointing for Enterprise. Much of the mobile revolution passed them by too! Cloud is a bit pricier than expected and keeping on top of trends (CloudFoundry/K8S) has been exhausting for in-house staff. Outsourcing is great for handle-crank, cheap IT and that's not going away. Also, why is Saas being frequently mentioned as a solution here? Enterprise system complexity is not very Saas friendly.

heisenbit 6y ago
Yes, if enterprise systems were easy SAP would have cornered the market long ago. Or Oracle for that matter. One of the most valuable experience in my education was being forced to write a review and discuss in class ‚There is no silver bullet‘. Better tools will not stop the flow of new requirements. And being good enough for todays business does not stop your competitor trying to outmaneuver you. The dynamic may change once silicon progress has slowed down but until then it will be risky to stop innovating.

ThePadawan 6y ago

I have been keeping my ear to the ground in the local job market (Switzerland) and personally haven't encountered any company that outsourced to India specifically. Most popular are Eastern Europe (Serbia, Ukraine, Romania) and Asia (Vietnam). The """savings""" multiplier is still in the order of 3-4x, but time zones work out better. I am however, still baffled how this happened after seemingly every company made the discovery that outsourcing too much of your business doesn't tend to work out (20 years ago, during the last boom). I also talked to several companies that were willing to trust their outsourced teams to work remotely, but not the staff located in Switzerland (who once again have to come to the office during the pandemic).

burntoutfire 6y ago

These consultancies may also finally reap what they sow re: quality of work. I work in a major bank and some senior managers say they'd rather get the plague than a team of those guys. The managers need to deliver what they promised to their higher ups, and they've learned that these teams, however cheap they are, in practice will not help them with that. Btw these companies still manage to get some business with us, which I suspect is to some degree helped with bribes.

afrojack123 6y ago

Indian IT consultancies have been struggling against technological obsolescence for 30 years. And they will continue to struggle for many more. This is an idiotic hit piece hit written by a journalist who needs to meet his quota. This journalist has never worked for one of these consultancies, a tech company, or been in C-suite of any org. I have worked in these "consultancies" so here is my take. There is a wide range of talent in these consultancies. Some examples are web app developers/software engineers, website people, implementation engineers/enterprise app software, supply chain, cybersecurity, etc. Yes, unfortunately, some of this talent is not familiar with basic software tooling like basic linux commands or git or setting up a path variable. This sounds really bad until you work with a Georgia Tech computer engineering grad and realize he doesn't know this either. Many methods of sales. A sale can be considered a billion dollar deal or having a director hiring a contractor. The billion dollar deal is closer to consulting. The director hiring a contractor is closer to professional services firm. Prior to these consultancies, the orgs would hire their own employees and train them. What changed? Contractors easier to layoff than W-2 employees. Maybe their own employees didn't have the expertise. The truth of the matter is for most organizations, IT is a cost center along with legal and finance. It is not their money maker. They have no interest in innovative IT/software "technology" until their competitor in the same industry as them has it. Price matters. Laying off people easily matter. "Consultancies" exist for that reason. Look past their marketing/branding and their official classification is a professional services firm.

rafiki6 6y ago
> The truth of the matter is for most organizations, IT is a cost center along with legal and finance. It is not their money maker. They have no interest in innovative IT/software "technology" until their competitor in the same industry as them has it. Price matters. Laying off people easily matter. Accurate and poignant. Having lived in the banks for a while, this will always be the case in industries. They don't give a shit if you have a passion or about your career. They want you to be a "xyz developer with 50 years of experience". Sometimes I think we forget how the real world works when we are enamored with the cool things computers can do.
- 6y ago

Brajeshwar 6y ago

To set context, I'm Indian. I used to work for Razorfish for about 2 years, working with our counterparts in London, Austin, and San Francisco. I ended up building a team of 50-odd Products Designers and Front-end Engineers in about a years time. So, We used to work with lots of "engineers" from well-known other Indian Outsourcing firms. Here are few anecdotes; Even amongst themselves, they don't respect each other individuals and teams. The Indian team in Singapore/Bangalore/San Francisco will called the Chennai/Other-Locale team as their outsource partner/team and are mis-treated. I was like, "I thought you guys were team!" In another incident, I once lambasted a "tech-team" of a really well known India company for not even knowing how to push codes to git. I patiently explained to the team on how to work collaboratively and to push codes, send in pull request and not to email us zip files of their codes. Their head of something-something (too many senseless designations/titles) was not happy and in his mistake, sent a "Reply All" to the tune of, "Any email from Brajeshwar should not be replied immediately, call a meeting with the tech heads." Well, I was kinda referred to someone who should be sent in when shits stars hitting the fan. ;-)

yawaramin 6y ago
Can confirm, I worked for Publicis Sapient (formerly SapientRazorfish) for a bit and heard some horror stories about consultant firm software devs. (Ironically enough, SR/PS is a consulting firm too...)
- ajo_mathew 6y ago
  Depends on managers and who pulls for what work. Western companies take all the great work and push down to Indian firms not interesting work, some dumb enough managers will bow to client( bootlicker ) without much of know how take that job and come to us. I worked in MNC and Startups seen my fair share of so called types of projects/managers.
rememberlenny 6y ago
I had the same experience in Shanghai with a similar top tier agency. I was hired by a Fortune 500 apparel brand to be their digital project manager to handle the agency and Q/C deliverables. It was 2013, but even then I was blown away by the extent to which the engineers on their end didn't use any modern version control. All of the deliverables were send over FTP updates, and zipped file directories.

la6471 6y ago

This feeble attempts to generalize a whole nation or group of people will not succeed. Individuals differ from one another and Indians are the most diverse group in the world. Some of the engineers are good some are bad , just like everywhere else. The sooner humanity realizes the truth about individuality and discard the stereotypes attached to groups and aggregates the better it will be for the whole world. Amen.

goatforce5 6y ago
> and Indians are the most diverse group in the world What metric(s) are you using to measure that diversity? I live in Toronto, Canada, and approximately 50% of residents here were born overseas. Toronto likes to boast it is one of the most diverse cities in the world (based on that metric, at least).
- throwaway0648 6y ago
  They're probably using this list https://en.wikipedia.org/wiki/List_of_countries_ranked_by_ethnic_and_cultural_diversity_level https://en.wikipedia.org/wiki/List_of_countries_ranked_by_et... And you are probably using this one https://en.wikipedia.org/wiki/List_of_sovereign_states_and_dependent_territories_by_immigrant_population https://en.wikipedia.org/wiki/List_of_sovereign_states_and_d... So it depends what you mean by diversity
- elongatedMusku 6y ago
  Well we have more than a hundred languages in India. A lot of them look very different to each other if you are looking for skin color. There are east Indians as well who look Asians.
- mahastore 6y ago
  Diverse in terms of religion food habits culture race and of course language. Over the course of human history India has been a melting pot of people coming from all over the world.
0pranav 6y ago
As far as I read the article, it seems to address the Indian consultancy companies rather than Indians as people.

ramshanker 6y ago

TLDR of the article is American / European companies creating in-house Indian offices and moving away from "consultancies". I whole heartedly agree to the huge advantages you get doing this. You have better control over hiring quality talent, more focused developers who develop institutional knowledge over time, much easier to scale up/down than the contracts with these consultancies and so on..... Outside IT, I can confirm the same tree has been happening from my industry of Oil & Gas consultancy. Many American / European oil & gas consultancies now have Indian engineering centres employing chemical / mechanical / civil / electrical / instrumentation engineers. It is easy to setup this over here. Everyone is welcome.

aszen 6y ago
Being a part of one of these, I agree most companies have realised have a dedicated offshore team is much better than assigning work via third party consultancies. If anyone is struggling to hire in their local market definitely try to get in touch with talented people offshore and see if they can bootstrap a small development team to help your business. Also it's not always about cost cutting, sometimes businesses struggle to find developers working on their technology platforms or just lack the pull to attract local talent. In these cases if you invest in an offshore team and help them learn about your business needs it will pay off in the long run.

jorblumesea 6y ago

Pretty much what everyone in the tech industry has been doing for years. Better to have your own overseas office where you can control the hiring bar and talent vs making consultancies rich. The big consultancies are more concerned with draining value from clients and treating them like cash cows instead of delivering value. That being said, probably the real solution is SAAS.

Abishek_Muthian 6y ago

It was far much worse, now the major consultancies are on rapid re-skilling drive, also they have made significant changes to their pricing strategy to their clients and are not just based on head count. But the criticism of technological obsolescence cannot be just levelled against these consultancies alone, much like how almost every electronics hardware was(is) is manufactured in China due to cheap labour costs, so was the reason behind extraordinary growth of Indian IT services and so it all comes down to 'What the client wants'. But when their client suddenly wanted to catch up on the AI/ML/Analytics bandwagon, these consultancies understood the need to revamp their skilling strategy. That said, it's not like these consultancies never innovate they have dabbled with large in-house products ranging from cloud to automation and some have been fairly successful e.g. TCS ignio, their (AI in air-quotes) automation product[1]. End of the day, they get the job done for their clients which includes almost every major Bank, Retail, Pharmacy to even Aerospace industry like Boeing (Only green card holders/US citizens are employed), Automobile - Ferrari, Cyber Security etc. also saving huge amount of money for them in the process. [1]https://digitate.com/ignio-aiops/ https://digitate.com/ignio-aiops/ (Warning: Marketing fluff).

random314 6y ago

Thanks. Grammar check - its note "codes"; it is "code".

klodolph 6y ago
Wrong—“codes” is correct in the Indian dialect of English. This is akin to arguing over whether “color” or “colour” is the correct spelling.
- krapht 6y ago
  It's also, for some reason, what people say in scientific computing.
- senkora 6y ago
  Is it like fish and fishes? fish = plural for many of a single kind of fish fishes = plural for multiple kinds of fish So by analogy: code = any amount of code from a single project codes = plural for code from multiple projects I'm American and this is how I use code/codes, so I'm curious whether you make the same distinction, or if you always use codes.
  - andybak 6y ago
    Brit here. It's always "code" and "codes" sounds like something a non-technical middle manager would say and get sniggered about behind his back.
  - eloisius 6y ago
    Sounds like saying “the sands from beaches around Florida” to pluralize code to me. How much is a single code?
  - klodolph 6y ago
    I’m American, this is just my take on it. I don’t think fish / fishes is quite right. Look up “code” in the dictionary and you get at least two different senses of the word: 1. System of substituting letters/words/symbols/etc. for letters/words/symbols/etc, e.g. “morse code”. Countable noun. 2. Computing program instructions. Uncountable noun. This is not like fish / fishes, because “fish” is countable—I can have one fish or two fish. When talking about computer programming instructions, I cannot have one code or two codes, but I can have one line of code or two lines of code. Just like I cannot have a bowl of one thousand rice, but I can have a bowl of one thousand grains of rice. Rice is “uncountable” in the grammatical sense even though it seems like you should be able to count it. In Indian english, my understanding is that for the second sense above, “codes” is correct and “code” is incorrect. In that sense it is probably similar to “data”, in the historical usage where “data” was plural (in modern usage, “data” is often considered singular). So, “The codes are on my hard drive.” makes sense to Indian english speakers, and “The data are on my hard drive.” makes sense in historical (say, early 20th-century) English. There is a singular version of data, “datum”, but rarely used.

neonate 6y ago

https://archive.is/yNKSj https://archive.is/yNKSj

rramadass 6y ago
Thank you!

ktrl 6y ago

They should have seen this coming. The big Indian IT consultancies have existed since the 1980s and they have been swimming in billions since the early 2000s. They should have invested into actual product development at least a decade ago.

alexpotato 6y ago

I forget where I heard this quote but I think it summarizes the whole "outsourcing as a boondogle" scenario: 1. A good development team in the US/Europe costs $X 2. An equivalent team in not the US/Europe costs 75% of $X 3. A terrible team in not the US/Europe costs 25% of $X Most outsourcing decisions instead of stopping at Option 2 and enjoying the 25% savings, got greedy and went full bore to Option 3 and thought themselves geniuses.

naruvimama 6y ago

Just judging from the title it sounds silly. Last I remember while working at one of the companies between 2006-2008, COBOL & mainframes was a good chunk of their work. Obsolescence is their bread and butter. I do agree they do have a lot of wrong and toxic people running middle management along with short term thinking. But that is partly due to their business model, a business model that gave the best returns.

Cthulhu_ 6y ago
Nail / head I think; a lot of western devs, especially the HN crowd, has the luxury of moving to the next 'cool' thing every couple of years. But they did write code, they laid the groundwork, and it has to be developed further on. Billions of LOC of Java are lying around and there is a need for an army of developers to look after it.

naruvimama 6y ago

You can get very good developers from these companies, and you can get it in volume, you just need to insist on it. When you ask for Sr.managers, 2xmanagers, 2x Asst. Managers, 2x Business Analyst (with MBAs). You are quickly adding up costs for non-functional heads. The only way to remedy that is to go cheap on developers and bloat their numbers to match the overhead.

marjann 6y ago

I believe there is a bias towards the outsourcing, at least judging by the comments. Let me tell you my side of the story. We are a software development company based in Macedonia - Emit Knowledge From personal experience, we've refactored/rewritten code that was developed by development teams from USA, Canada, Sweden, Denmark, UK where the hourly rate is sky high compared to ours. According to me the problem is not in the outsourcing itself, but rather in the company size and culture. Bigger companies tend to have stronger sales teams, getting whatever is in their way, closing deals without having expertise and know-how. The only driving factor is how to maximize profit. Hire less experience devs, leave the SRS so you can charge CRs and that kind of doctrine. On the other hand, I can tell that we as a company have better processes than bigger companies: - having our own framework: https://signals.emitknowledge.com/ https://signals.emitknowledge.com/ soon to be open sourced; - having multiple products, which you will find as rarity when it comes to agencies; - having an research and development; - before we start working with a client, the agreement is that it is a two sides stick, the client needs to be part of the development if success is expected; - regular communication is a must; - we discuss with the clients to reduce scopes if we identify that it will increase costs without providing a business value at the end; The difference is in the culture. As a CEO I would like my client's business to succeed so we can work together as partners, long terms, instead of getting money from CRs and playing "you haven't specified this". Be transparent guys. Stop playing games with your clients. You need to give in order to get.

hashhar 6y ago
> The difference is in the culture. As a CEO I would like my client's business to succeed so we can work together as partners, long terms, instead of getting money from CRs and playing "you haven't specified this". I think this is the part that's most important and similar to how orgs like RedHat operate.

ycombonator 6y ago

https://www.tcs.com/business-4-0/report/behaviors-digital-transformation https://www.tcs.com/business-4-0/report/behaviors-digital-tr... Just read this and tell me if any of this makes sense. I read it 10 times and couldn’t figure out what is the value they are bringing.

api 6y ago

From what I've heard, programmers that are as good as domestic (US/EU) programmers can absolutely be hired in India and lots of other places. Problem is they are not significantly cheaper than domestic programmers once you add management overhead and then compare the result against equally skilled domestic programmers in lower cost of living places in the US/EU. It's more practical and may be no more expensive to hire someone good in West Virginia, Kentucky, or Michigan where rent or mortgage payments and many other expenses are quite a bit lower than they are in big coastal cities.

babaganooj 6y ago

Cisco's IT is almost 100% Indian, and by almost 100% I mean I've only seen one or two out of thousands who weren't Indian. Cisco's Indian IT department managers having exclusive preference for Indian companies. It's so against the law for Cisco to have their IT department almost fully staffed by H1B visa holders who work for some Indian outsourcer and are themselves all Indian. The work they do is only half decent (well, not really, it's purely best effort, and depends on the individual or team doing the work it can vary dramatically) The CEOs of many of the Indian outsourcers are so incompetent and focused so exclusively on relationship based selling that it's pointless to even bring up the topic of them falling behind the tech adoption curve. It's a giant heap of incompetence and corruption.

opportune 6y ago

I think you can be successful outsourcing to WITCH or other consultancies IF you have an in-house, full-context software engineer managing the project and keeping people accountable. You have to be careful because if you ask for someone who is "an expert in X technology", you'll definitely get someone, and they might be able to describe it at a high level, but may not even know how to compile a program or how to copy a file (yes I have literally seen this firsthand). You need to give people explicit instructions and be willing to help, and the in-house software developer almost definitely needs to provide things like architecture/spec. And you need to actively fight the need to increase the staffing for the project and prevent dumb/churn processes from taking over (example: writing 40 different scripts (separately!) to do something that could just as easily be done by one script with three parameters). And you need to manage the project into a position where maintenance/ownership can be transferred. You also need to set them up for success by having a clearly defined scope and playing towards their skills (which means, don't give them work that needs a ML PhD math genius, do give them work like "write a PHP website that does this and looks kinda like that"). This is part of what I think the article is missing but also not really a fair expectation of what an outsourcing firm is. Consultancies are not meant to come up with 'killer apps', and you can try to pay them to do so and they'll be happy to take your money, but you shouldn't.

shash 6y ago

It’s easy to tar the entire Indian IT industry with the same brush, but it’s a much richer ecosystem than just the Big Five. For example, I work in a small product based company in a niche segment where we’re among the very few people who can provide the solutions we can, and I’d happily pit my colleagues’ skills against the best of SV. Keep in mind that this article is only about the Big Five. They have a certain business model, a value proposition and a set of clients whom they service. A particular niche that’s been very lucrative and productive for them. This, as the article says, may be drying up. But that doesn’t mean that Indian IT as a whole, or even most of Indian IT is in trouble.

ntsplnkv2 6y ago
It won't dry up that quickly. As long as customers still use SAP and Oracle it will be a long while. The problem with enterprise software was never the technical details - it was getting archaic, inefficient business processes in systems that didn't support those processes. This doesn't change with SaaS. Extension tools have gotten better but the core problem still exists. So many customers still use on-prem SAP hosted in the cloud. The end result is the same requirement for everything but sysops.

known 6y ago

Indian IT consultancies make money by selling Software Engineers, not Software to US/EU;

known 6y ago

https://archive.is/yNKSj https://archive.is/yNKSj

desaiguddu 6y ago

I run a boutique consulting studio in India. Indian outsourcing /offshore teams are beyond Infosys, TCS, Tech Mahindra, Wipro etc. There are design & engineering teams who deliver amazing value to their clients. These teams are nimble & specialised.