The outsourcing of America’s jobs

The article discusses the effects of outsourcing on the American Middle Class. Many people in USA are now becoming 'India-aware' but are they not aware how developed nations and their coporations have been exploiting developing nations from years. But again we cannot blame them, cause almost all developing nations are headed by fully corrupt politicians.

The outsourcing of America’s jobs


Today, consistent with economic globalization policies, corporate America is either importing less-costly immigrant labor or shipping jobs out of America and into underdeveloped countries, where profits can be maximized. Jobs are being taken out of the U.S., while President Bush is busy telling Americans that they will see more jobs.

At the same time, he is pushing to reduce regulations on industry to increase overseas trade. And who do you really think is going to reap the benefits of any proposed tax relief? Government is coerced into fostering legislation that allows corporations to carry out their plans (i.e. The North America Trade Agreement, etc.). Hence, major corporations are downsizing their American workforce and at the same time exporting jobs into Mexico, Latin America, Taiwan, China, India, Russia and other parts of the world.

Hyping the Outsourcing to India

According to Tom Drury, managing director of Vertex, a major customer services operation set up in 1996, more British jobs might be relocated to India, but he believed that 'the situation is over-hyped'."

Anti-India Anti- Outsourcing

Article :
The Pitfalls of International Outsourcing

Controversial Outsourcing

Subir Roy of Business Standards interviews of Harris N Miller who is president of the Information Technology Association of America (ITAA), which represents over 500 leading IT-related companies in the US.

"What is your role in the US?
Ans.
The role of IT in the US is to stop bad things from happening. We want to stop governments from imposing restrictions on work going offshore, stop there being additional restrictions on immigration. If the opponents define the debate as a win-lose situation, that if the Indian industry grows, the US industry falls, then we, the US and the Indian industry, are all in trouble. If we define the debate in the US and in India as a win-win and be mutually together then the opponents are going to fall by the wayside.


It has been said that it is necessary to seek a far higher level of political support on the issue in the US than available so far.

Ans.
Even the strongest supporter of globalisation in the US Congress is not a strong supporter when unemployment is 7 or 8 per cent in his Congressional district. The ITAA and its member companies who support globalisation don’t support offshoring. We don’t support losing jobs to India. My membership [of ITAA] is US-based.
We support fair global competition, we oppose restrictions on it and we have to convince our elected officials day in and day out. My lobbying message is: that’s a better model than the restrictionist and protectionist one. And we can give them things to do, like promoting education and training in the US. We’ve been falling behind in the US on this. "

- Business Standard .. ‘Outsourcing to India is a controversial issue’:

EU-India Business Summit

India and the European Union begin one of their biggest-ever trade facilitation talks on Friday as the fourth EU-India Business Summit kicks off with opening session address by External Affairs Minister Yashwant Sinha and EU Commissioner for External Relations Chris Patten.But the talks on WTO issue are unlikely to take place during the summit.

HIT Venture Funding

At a time when venture capitalists are shying away from funding start-up IT companies, Hyderabad Information Technology Venture Enterprises Ltd (HITVEL), the first venture fund floated by the state government, is not thinking of exiting from the funded companies and is rather looking at a Rs 40 crore fund for start-ups. : : Finacial Express: :

Virgin to move jobs to India

Virgin Atlantic group has decided to move the entire group’s back office and call centre service jobs to India and has has entered into a tie-up with Bangalore-based leading business process outsourcing (BPO) company ICICI Onesource recently for outsourcing the jobs initially on a pilot basis.

Dell Affirms its committment

In response to a number of complaints about customer service calls, Dell Computer (Quote, Chart) is bringing some of its overseas business customer service back to the U.S., but stressed that it remains committed to its call centers in India.

Tit for Tat : Arun Shourie

The US of A is getting very protective and anti-india anti-outsourcing sentiments are rising sharply with legislation in eight states in the US now, compared with five states just three months ago. Shourie hits back by saying that if they will close the services market , we also have the option of closing the goods market.

We should co-operate with our competitors. But at the same time, we should not open up in goods, if walls are set up to block access to services,” Communications, IT and disinvestment minister Arun Shourie said, while speaking at the India Economic Summit

Economic Pressure & Outsourcing

U.N. Conference on Trade and Development (UNCTAD) reports says that for developed nation the Economic pressures is pushing outsourcing.Companies in the United States and Europe are looking for competitive advantages and cost-cutting measures when they look to developing countries for IT outsourcing.

Cognizant to add 3,000 people

The $365-million turnover Cognizant Technology Solutions has chalked out a major expansion plan that envisages adding 3,000 people to its Indian off-shore development operations by the end of 2004.

Business Standard .. Foreign students prefer own business to corporate job: Students from the London Business School (LBS) prefer setting up own company and testing the skills learned to high-paid corporate jobs. However, for many students of the Indian Institute of Management, Ahmedabad, the corporate sector jobs still hold the charm"

Premji's maxims

Premji's maxims for IIT students:

*A rupee earned is of far more value than five found.
*Learn to lose and also to enjoy winning. And when you do lose, do not lose the lesson.
*Have faith in your own ideas even if everyone tells you they are wrong. Have enduring faith in yourself because then you will always have enduring faith in others.
*Life's battle does not always go to the person who is stronger and faster. But the person who wins is the person who thinks he can.
*Strive for excellence. We are what we repeatedly do. Remember, excellence is not an act but a habit.
*Always keep in mind that it is only the test of fire that makes fine steel.
*Open your arms to change, but don't let go of your values. Your values are your foundation for life.

BPO Baacklash !

A $15.2-million contract between a subsidiary of India-based Tata Consultancy Services and an American state agency has been cancelled, falling victim to politics in view of elections in the US next year.
Indiana state's Governor Joe Kernan, a Democratic candidate for elections due in November next year, has ordered the State Department of Workforceto cancel its contract with Tata America International Corp, a subsidiary of TCS, to upgrade state computers processing unemployment claims.BPO backlash! US state nixes TCS deal:

The India Fad

India with is growing BPO, Outsourcing and IT growth is becoming a great attraction in US campuses.
BPO to India a big fad on US campuses - The Economic Times

India : The voice of the developing nations

Business Standard .. US tech body says India should be voice of the Third World: "“When you talk about China, they (Americans) say it is a huge market with 1.3 billion population whereas India’s image is as a good software producer. They don’t know that India has one billion population and growing middle class consumers"

30 million Jobs through Outsourcing

"Right now less than one-third of fortune companies are going for outsourcing and less than one-twentyfourth of that was coming to India... So there is huge potential for job creation from outsourcing in the country,"
- K James Abraham , VP - Boston Consulting Group (BSG)
Outsourcing can create 30 million jobs in India by 2020: Study : HindustanTimes.com

28% Growth in Indian IT, but still insufficient

According to NASSCOM president Kiran Karnik, the Indian IT industry will see a export growth between 26 and 28 percent over last year's figure and the annual revenues are expected to soar to around US$80 billion by 2008.

On the other hand Rajat Gupta, a management consultant and a former McKinsey CEO isn't convinced and points the insufficiency
"True, we’ve made an impact in software services on the world stage, but it’s only a tiny segment of the global business opportunity and can induce a false sense of complacency"

Outsourcing with a Smile :-)

Julia Finch writes on Gaurdian UK - In India, it's service with a compulsory smile

"Mr Armishaw is keen to distance himself from comments by the bank's former chief executive Sir Keith Whitson, who caused a furore when he said that Indian and Chinese workers were better dressed, more numerate, enthusiastic and efficient than their UK counterparts. Mr Armishaw's arguments in favour of outsourcing start and end with cost, so long as there is no compromise in quality. "There isn't. The error rate is seven in every 10,000 calls in the UK and India."

Youngest CEO

Suhas Gopinath (17), born and based in the southern city of Bangalore is believed to be the world's youngest chief executive officer (CEO) of a software consultancy founded by him
Globals Inc. This minor aims to become the next Bill Gates and has some major contracts in his credits.

Nortel's Outsourcing Plan Back on Track

Nortel Networks, the Canadian manufacturer of equipment that route voice and data traffic through networks, has put its software outsourcing programme to India back on track. The programme had suffered a serious setback in the last two years due the global telecom meltdown.

Patentism or Protectionism

George Monbiot a well known trade theorist and widely-read columnist with 'Guardian', shares his vision of future with Tanu Thomas in Times of India's Q&A section last thursday. He discusses how the rich nations of this world are bullying poor and third world nations in the name of 'free markets' and how for the first time the developing nations showed their unity at the recent Cancum convention. His sites the example of Intellectual Property Rights and Patentism.
" The rich world has used its bargaining position to demand extraordinary concessions for its corporations. The classic example is the agreement on trade-related Intellectual Porperty Rights. 97% of patents are owned by coporations in the rich world, and it will cost poor nations $40 billion a year in licence fees, half of which will be payable to companies based in US. In return, it is very hard to see what the poorer nations have gained."

C. K . Prahlad on Indian Entrepreneurs

CKP, a professor with University of Michigan Business School makes these statements while addressing at the TiECon conference being held as part of IT.com 2003.

"There is a feeling that the poor are not a concern of the industry, but are the wards of the state. The industry should instead look at the poor as a source of innovation. I don't care if you do it because of a deep moral obligation or because it's a good opportunity or even just for greed."

"Don't worry too much about the resource shortages, poor infrastructure, labor laws, cost of power etc. Entrepreneurs don't sit and complain, they go and do something about those complaints. It takes a lot of imagination to be an entrepreneur. It's the ability to see a theme park in a swamp."

[ Source - CIOL]

Datamatics Invest $10 million

Outsourcing startup White Label LLC of Billerica has closed a funding round from Datamatics Limited of Mumbai, India, at $10 million. With combined revenues of Rs150 crore, DTL emerges as the largest third-party pure-play BPO player in India. Datamatics News Flash about more such aquisitions.

The Human Network

A Technology Review article informs how Human Body Network Gets Fast. The Human Body Network a.k.a ElectAura-Net developed by Researchers from NTT Docomo Multimedia Labs and NTT Microsystem Integration Labs the ElectAura-Netis wireless, but instead of using radio waves, infrared light, or microwaves to transmit information it uses a combination of the electric field that emanates from humans and a similar field emanating from special floor tiles.

Microsoft's BPO Cluster

Microsoft is planning a Microsoft Global Product Support Centre (GPSC) and one of the largest BPO cluster in India with 9,000 people.Microsoft planning huge BPO cluster in India - The Economic Times

Coming to India, the BPO nation

Foreigners attracted to India's BPO culture: With more and more British and American outsourcing jobs coming to India, many Europeans are looking at India as a potential employment opportunity.

Outlanding Outsourcing

Scorp writes Outlandish outsourcing: What are its long-term effects? | TechRepublic. A wonderful article on protectionism, outsourcing and free market. The ultimate question raised by author is what would happen if US Govt or any govt for that matter would try to fix it. A must read

And they call this "protectionism"…why??

It doesn't protect the rights of the workers if the company is forced to lay off employees, or, worst case, to close its doors. Yet there are plenty of people who would call that company "unpatriotic" (or worse—if in fact there IS a worse insult, these days!) for contracting out the job to a foreign-based concern. The point is, though, that the Law of Supply and Demand, with its inexorable corollaries of Price and Cost, is not mocked lightly nor for long. It's also an historical fact that legislating "protective" trade laws never really works on a long-term basis. It also quickly creates an underground market for smuggled goods. In the case of application code, that smuggling may be done rather undetectably—a few .zip files e-mailed nonchalantly over the wire, and delivery is a fact.

US$1.2 trillion Outsourcing Market

India has had recent success in outsourcing with the sector making around a quarter of India's total software revenues of US$9.5 billion last year. Outsourcing to grow to US$1.2 trillion | CNetAsia