4 ms·
All this outsourcing talk is so 2005. If it worked so easily, FAANG would've outsourced everything to India 10 years ago and tripled their profit. In reality a
by foepys 5y ago
All this outsourcing talk is so 2005. If it worked so easily, FAANG would've outsourced everything to India 10 years ago and tripled their profit.
In reality a common cultural background (i.e. how to approach some kind of work) is a lot more important than a lot of managers want you to believe. Outsourcing also requires extensive planning and management, which increases the number of managers required and thus increases the costs of outsourcing.
E.g. VW tried outsourcing over the last 10 years and is now recruiting developers en masse in Germany because it failed to make it work.
- pjmlp 5y agoGiven how much companies like CapGemini, TCS and Infosys grew in Germany during the last 15 years, I bet VW still has plenty of business units going at it.
- thrower123 5y agoI have never talked to anybody who used those outfits that were happy about the results. It must be an incredible cost savings.
- pjmlp 5y agoWhen problems in such projects escalate they are sorted out during business lunches or golf matches. What the crews on the machine room think about the deal hardly matters.
- unmole 5y ago> All this outsourcing talk is so 2005. Except for the fact that it's not outsourcing to the lowest bidder like companies tried back then. Pretty much every major American tech company has a development center in India. The developers working here are employees of the parent company. They have the same or functionally similar culture as the HQ. And the cost advantage has significantly shrunk because of the booming local startup scene.
- pridkett 5y agoThe first part is true - almost every major American tech company has a development center in India. The second part, well, I’m not so sure about that. There’s tensions about different cultures including things like different holidays that aren’t always well advertised. Tension about the perception that American jobs are being outsourced, or at the very least not-replaced, because of overseas development. Tension about quality. Tension about lack of overlapping work hours. Tension about poor connectivity at home (which has become less of an issue as the pandemic has worn on). No matter how you slice it, it’s very hard to get people to feel like they’re all on the same team. It can happen, but it take tremendous time and effort. If you’re ever interviewing and someone insists that using an outsourced development firm or Indian development center will only cost 30% as much as those close to the HQ - I’d recommend walking out. Because it’s clear they don’t understand (or perhaps care) about the true economics.
- thrower123 5y agoIt's a cycle that keeps going. One VP will try cutting things over to the Indian teams to save some money. This generally works temporarily, and they go up and out. Then efficiency dies the death of a thousand cuts, and the next VP brings that function back in house, to great satisfaction albeit higher costs. Rinse and repeat.
- ambrozk 5y agoI have worked with people in such a development center, and the quality of their work is very noticeably worse than that of their equivalents in the US.
- ithkuil 5y agoThen hire managers from Hyderabad EDIT: by which I mean that the issue is more deep than just how to manage people. Managing an existing talent pool seems to part of the picture.
- UncleMeat 5y agoIt isn't outsourcing. If I moved to London, my pay would be adjusted down by like 45%.