August 30, 2007
Outsourcing is dead (long live outsourcing)
You do it every day and never think twice: buy something that was made in another country.
Maybe you make a big purchase, like a Honda or a BMW. Do you then refer to your car as your ‘outsourced’ ride? When you drink with your friends, do you get uncomfortable knowing that your champagne has been ‘outsourced’ to the French? How about when you eat a mango or a banana?
Of course not. Germans make better cars. The French know their wine. And produce comes from where it grows (or where people can pick it cheaply…California).
So why think of software that way? Global IT teams support cost advantages and time efficiencies that domestic teams simply cannot compete with. Done right, software can be developed more quickly and efficiently this way. From cars to wine to software, the principle is the same. It will inevitably get done where it can get done best.
As long as we refer to our work as outsourcing, we are stigmatizing something that is as old as civilization. What the monsoon winds did for the spice trade, the Internet does for software development.
So, let’s agree. Outsourcing is dead (long live outsourcing).
[and yes, this blog will soon have a new name]
January 9, 2008
at 4:27 am
One of the main reasons that software development out-sourcing has such a bad reputation is that it’s very different to buying a German car or French wine.
In both those situations the company is generally based there, so it draws upon existing expertise, while retaining nearby control of the production process. It is then shipped as a completed product.
In a common software development outsourcing situation, the general form of the product, if not the full specification and design is handled by a company in one country, and then the work is done by another company in another country.
The situation is more akin to Royal Enfield motorcycles - the product is made at a low cost abroad (India, for Royal Enfield), and then more effort has to be put in to ensure that the resulting product meets the desired standards. The resulting cost of the product is not significantly cheaper than other production methods, but avoids setting up a significant production team in this country.
Outsourced development gets a bad name for getting rid of established teams in the hope of saving money, dispensing with the local quality control.
Aside from that common mistake in dispensing with quality control, it’s not really that different to other manufacturing - whenever a car maker or other manufacturer decided that it’s going to stop producing its product locally and instead make it abroad and ship it across, unions are up in arms about the loss of jobs, and negative publicity is generated about the change. It’s not then as much about whether the quality will be poor quality (although with IT it’s generally seen as the equivalent of shipping your manufacturing to a random chinese plant, quality-wise), but about protectionism and hurting the local economy.
January 10, 2008
at 7:35 am
There is not complaints of outsourcing. Everything you named works. The cars, the drinks and the food - Rides really nice, goes down smooth and taste really good. Outsourcing software would be good too, if it didn’t have the poor quality and didn’t require 2-3 times the amount of effort to get it completed!
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