A few years ago, I coined the following statement to encapsulate one of the many things I love about virtual work:

You work. They sleep. Reverse. Repeat.

When global teams work efficiently, they can move with a speed that is impossible for a single-office team to match, no matter how much Blue Bottle coffee is involved.   After cost, it is the single biggest advantage of global work.

Yet, for the past decade, most literature on global collaboration has focused on the negative aspects of 24-hour work cycles.  The party line has been that time zones are a handicap we must overcome, and global teams will always struggle to manage communication, iterate quickly, handle disconnects, and clarify scope.

This is with good reason.  Few global firms have reached a level of efficiency where they reap the advantages of 24-hour work cycles.  Inevitably, the baton is  fumbled, dropped, and stabbed into the hearts of unwitting customers.

Passing the baton is a discipline and an art form.  It is what separates talented teams from stellar performers.  It is a ninja-level skill, and after 10 years, many teams are beginning to show us what is possible when the baton is passed smoothly, day ‘n’ nite.

Because of how important the baton-passing process is, my statement actually needs to be revised:

You work. They sleep.  Everyone talks.  Reverse. Repeat.

Over the next few weeks, I’ll be demonstrating how Monsoon handles baton-passing for design and development.  

Until then, our India office is almost awake, which means it’s time for everyone to talk.

Over the last 5 years, IT wages have been rising in India.  And for good reason!  Indian programmers are now some of the most experienced IT professionals in the world.

However, if alarmist blog posts are to be believed, this signals the beginning of the end for the still-nascent IT industry in India.   When Indian salaries are higher than American salaries, the incentive to offshore is gone.

Although I disagree with this premise for several reasons (the subject of future blog posts, I guess), I thought it would be interesting to try to figure out when the (cue horror film music) ‘Death Of Outsourcing’ is gonna go down.

So I channeled my undergraduate economics degree (ceteris paribus!!!) to figure this out.

Figuring out salary rates is easy.  But, if people are acting rationally (which economic professors are beginning to realize is a rare occurrence), they will consider more than just cost. Value must be factored into our equation.

Now, value is a subjective thing, but thanks to online marketplaces like oDesk, we can use ratings to understand the general value that customers are getting from the US and India.  We’ll use numbers from oDesk as our example.

For a variety of reasons, this is an admittedly flawed example,  but it serves our thought experiment just fine.

[For those who don't know, oDesk is an online marketplace that connects people looking for IT work with those providing it, like an eBay for IT.]

According to oDesk, Indian workers are paid an average of $11/hour, whereas American workers are paid $17.50.  There is a similar differential in value.  Indians received an average rating of 4.12 (out of 5), while Americans received an average rating of 4.48.

So, using these figures, you get a couple of simple insights:

In the oDesk marketplace, offshoring still makes rational sense, and the difference in value is surprisingly low.

Okay, okay, okay, there are several reasons this is flawed:

But, this example of one marketplace is still useful, and if you allow for a greater difference in value, the implications of the equation are clear:

If salaries are going up, value better go up even more.

More importantly, salaries ARE going up.  It’s inevitable, and demand for Indian IT will continue to push them up further.   And, other IT destinations such as Vietnam are now offering reasonable alternatives for low-level work.

Indian companies will be beaten on price, but they can continue to differentiate themselves by providing stronger experience, niche specialization, and seasoned communication/management.

It will be the companies that fight the urge to cut corners and compete on price who will succeed. Focus on improving value, and the long-term view is rosy.

(image via ultrabrown.com)

Taking on the free trade bogeyman

Nothing, after all, will bring back labour-intensive manufacturing to the US. But to be effective, action would entail higher taxes. With the US in the grip of an economic downturn, such policies are unlikely to be vote-winners. That is why we can expect Mr Obama and Hillary Clinton to continue their attacks. As long as they remain rhetorical, they are cost free. At some point, though, America will need to have the debate its politicians have avoided.

Khosla’s Conspiracy

Like other green venture “capitalists,” Mr. Khosla now claims that corn ethanol is merely a springboard for the cellulosic varieties, which don’t draw on food stocks. Of course, his investments in such fuels also come with their own handsome subsidies. As long as he’s on the federal dole, perhaps Mr. Khosla should take a vow of embarrassed silence.

We should celebrate rising divorce rates

Rising divorce rates (in India) tell us one thing for sure: that more and more women are finding the means, and the independence, to walk out of bad marriages and live life on their own terms. If we judge ourselves as a society on the state of our women – and surely that must be a parameter – then this is good news. We do not need to credit either feminism or Western culture for this – the emancipation of women in real terms, across the world, has been enabled by technology, and can be explained most easily with economics.

The smartest unknown Indian Entrepreneur

“We hire young professionals whom others disregard,” Vembu says. “We don’t look at colleges, degrees or grades. Not everyone in India comes from a socio-economic background to get the opportunity to go to a top-ranking engineering school, but many are really smart regardless.

India/Brazil have most eco-friendly consumers, US least

The findings show that consumers in Brazil and India tie for the highest Greendex score for environmentally sustainable consumption at 60 points each. They are followed by consumers in China (56.1), Mexico (54.3), Hungary (53.2) and Russia (52.4). Among consumers in wealthy countries, those in Great Britain, Germany and Australia each have a Greendex score of 50.2, those in Spain register a score of 50.0 and Japanese respondents, 49.1. U.S. consumers have the lowest Greendex score at 44.9. The other lowest-scoring consumers are Canadians with 48.5 and the French with 48.7.

Making Long Distance Partnerships Work

The subject of planning comes up often in talks with long-distance partners. “If you are a mature business person, you understand that a detailed communication structure is required for success in any partnership, whether across the hall, across the room, or across the country,” said Richard Sloan, who runs the small- business radio show and Web site, StartupNation, with his brother, Jeff. The Sloan brothers themselves are now putting that observation to a test.

Leading Indian Telecom Seeking Deal in South Africa

Bharti’s overture is just the latest international foray by an Indian company. Primed by domestic economic growth that has exceeded 8 percent in recent years, some of the country’s largest companies have been looking to grow overseas, just as economies in the United States and Europe slow.

Fareed Zakaria’s Latest: “The Post-American World”

Zakaria’s latest big concept is The Post-American World, a just-released book whose argument he summarizes in a substantial essay in this week’s Newsweek. The basic idea is, the world is becoming a place where the U.S. is not a solo superpower, but rather a complex competitive environment with multiple sites of power and influence. Even as China and India (“Chindia”?) rise, it’s not clear that the U.S. or Europe will fall; rather, everyone can, potentially, rise together — or at least, compete together.

Math Prodigy & Call Girl

One and a half months ago, 23-year-old math prodigy Sufiah Yusof was exposed by a British tabloid earning a living as a call girl. She entered Oxford as a 13-year-old, dropped out after a year and demanded to be placed with a foster family because of her tyrannical father.

iPhone in India

So, we eat humble pie. Vodafone confirms a month old Business Standard story, it will launch the iPhone in India along with Australia, the Czech Republic, Egypt, Greece, Italy, Portugal, New Zealand, South Africa and Turkey, later this year. What will be the price? According to the BS story, the 8GB was slated to cost Rs 27 – 28k. Assuming custom duties on cellphones is 5%, at the current retail price in the US of Rs 16k (8GB) and Rs 20k (16GB), a very conservative estimate taking into account allied taxes and duties should be around Rs 21k (8GB) and around 25k (16GB), which would be needed to put it on par with the current rates in the greymarket.

YouTube Launches Site for India

The new site has all the content from the YouTube global site, but videos of relevance to Indian audiences have been given greater prominence, the company said in a blog on the new site.

One Night @ The Call Center

I read One Night @ The Call Center a few months ago, when the American  

publisher sent me a review copy. Some parts were so bad, they made me  cry. I was particularly bored by the chapters detailing the protagonist’s unrequited romance, which are set off in bold type for some reason a(though the fact that they are set off in bold is actually useful — the font makes it easier to identify the chapters to skip!).

Topless Meetings are more Productive

“In this age of wireless Internet and mobile e-mail devices, having an effective meeting or working session is becoming more and more difficult. Laptops, Blackberries, Sidekicks, iPhones, and the like keep people from being fully present,” he wrote in November 2007.  ”Aside from just being rude, partial attention generally leads to partial results.”

Wanted: Indian Chefs

Finding them is increasingly difficult due to the second issue – that  of the growing demand for chefs in India itself.  

27 Billion in Remittances to India Annually

There are about 200 million migrants worldwide, supporting as many if  not more people at home. That suggests that remittances may reach almost a tenth of the world’s population. 

Nano, Jaguar, and Land Rover

There is, however, another possibility: that Ratan Tata, Tata Group’s  modest but surprisingly bold patriarch, has got himself an extraordinary deal.

Desi 7-Eleven owners forced to mock themselves
Desi 7-Eleven owners, among others, are being asked to greet their customers with a banner mocking their ethnicity and accent as a promo for the Simpsons movie. Next they’ll be asked to don turbans and bow to customers while lisping.

Caste Away (complete with cheesy caste comic)
But India’s rapid economic expansion — and its booming high-techsector — are beginning to chip away at the historical system that reserved well-paying jobs for upper castes and menial jobs for Dalits.

Process or Service
Process standards are supposed to create confidence in the effectiveness of the end result. They aren’t there as the sole criteria for selecting a service provider. It’s the services that really matter, and those services are distinct by virtue of the way in which they are delivered.

Wipro makes a green PC
India’s Wipro has introduced new PCs that are compliant with the European Restriction of Hazardous Substances (RoHS) directive.

India jumps on web 2.0
So marketers love this Web 2.0 shit. I have heard some of them ask us -
“There is no Orkut or YouTube for ‘India’- We want to build one. But first, we want you to sign an NDA.”

Friends are the new family
While the TRP obsessed saas-bahu serials still revolve primarily around the family, in urban India amongst the upper middle class, friends are the new hub of life!

The ugly duckling
As they say, sometimes a dog’s so ugly, it’s actually cute and perhaps when a car is & remains this backwards, it’s easy to wax nostalgic. Whatever the case, the humble Ambassador turns 50 this year and given the transience of modern life, it’s hard not to take notice… It’s hard to be desi and have spent anytime in da homeland without a stories like this“…police in north India once stopped an Ambassador with 27 people on board”.

The Moor’s 4th Sigh
The 3-year marriage of author Salman Rushdie and TV’s Top Chef host Padma Lakshmi has ended, according to his rep….In a statement from her rep, Lakshmi said she: “After an 8 year relationship including over 3 years of marriage, Lakshmi regrets that their mutual efforts failed to make the marriage work.”

Electricity Hobbles India
Look up at the tops of buildings, and on any given day, you are likely to find three, four or six smokestacks poking out of each, blowing gray-black plumes into the clouds. If the smokestacks are being used, it means the power is off and the building — whether bright new mall, condominium or office — is probably being powered by diesel-fed generators.

Bring on the Web 2.0 Bust
It’s no longer about beautiful products and genius developers. It’s about the money and the status, and hot PR chicks and marketing departments.

Paris Patel
The owner of Park Avenue Peerage, who wrote with such authority about the New York social scene, was no insider. In fact, he was an 18-year-old Indian American college student—from Illinois.

Muslim-Americans
The USA’s estimated 2.4 million Muslims hold more moderate political views than Muslims elsewhere in the world and are mostly middle class and willing to adopt the American way of life, according to one of the most comprehensive surveys of this segment of the nation’s population.

India, 10 Years Later
In the two weeks I spent in traffic, cars would constantly come within inches of each other, but never a harsh word. If you tried in the US some of the maneuvers routinely done in Mumbai traffic, you would be lynched by an angry mob of motorists that would feel their space and rights were violated. Not in India.

Outsourcing Gets Personal
So what’s PPO? It consists of those services that are offshored by individual entrepreneurs who are trying to bootstrap their new organisation as efficiently as possible. With technology advances and the growth of the Net, small offices, home businesses and freelancers can utilise PPO services and generate business.

newsstands of the upper west side
The brown guys behind the counter probably don’t care precisely what they sell as long as it moves. But it’s fascinating how good they are at matching the area’s demographic. Had only Nehru in the ’50s seen the
newssellers of Manhattan, he’d have abandoned the centrally-planned economy then and there.

outsourcing local news reporting
it can be done from afar now that weekly Pasadena City Council meetings can be watched over the Internet. And he said the idea makes business sense because of India’s lower labor costs.

web 2.0 in germany
Germany is buzzed right now and the biggest question for the startup scene is how the many look-alikes will develop over the next year. You’ll often hear that investors are hesitant to invest in ideas that “haven’t been proven in the US yet” but there are several other factors at work here…

rhinos fund terrorism
According to India’s security services, police, intelligence analysts, local traders and forestry officials, Islamic militants affiliated to al-Qaida are sponsoring poaching in the reserve for profit.

shetty fights the moral police
Shetty, meanwhile, has blamed a “lunatic fringe” for creating the uproar over her allegedly “obscene” behaviour.

Calcutta Cracking
Satya Paul saris and Giorgio Armani jackets float in shop windows, and
in today’s India, people actually have the money to afford such luxury.

India invented kissing
Auntieji, I am referring to kissing. Snogging. Mouth Mashing. Tonsil
Field Hockeying. Two desis each kissing the apple sequentially in a
Bollywood movie, except there is no apple and there was no Bollywood.

V-I-S-A
Kunal Sah, a 13-year-old eighth-grader, is an angry speller.

Give Martha Stewart a recipe for samosa
Oprah is searching for the Next Big Idea —and guess what? Aneela Rajusth of Schaumburg, Illinois, is the one who wowed the daytime queen and her judges on today’s show.

Privatizing Memorization in India
Imagine for a bit what it would be like if education were provided by private sector firms. Can it be done?

Our papaya goes down:

A haiku from Anna at Sepia Mutiny: Don’t cry, little one | We heart you, dear Sanjaya. | May your haters rot.

The N Word (and some advice on customer service):

You may have heard that recently a desi furniture retailer in Toronto got into a bit of hot water for selling a sofa with the tag shown below to a black family (Candians of Ghanaian origin). As paragons of racial sensitivity and spin, we thought Sepia Mutiny should offer some public relations advice to our Canadian brethren.

Wipro’s revenue up 41%:

The continuing boom in outsourcing to India has helped the country’s top outsourcers post strong revenue and profit growth for their fiscal year ended March 31.

India makes Adobe sweet:

And, it was Adobe’s Indian R&D centre that contributed significantly to the launch of its star product, which signifies the increasing trend of strategic R&D work that is being delegated to India. Spread across two campuses, one each in Noida and Bangalore, the centre has approximately 1,000 people working for it.