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H1-B will be a history soon. Any comments??

Sirisha Reddy
Ranch Hand

Joined: Jun 09, 2003
Posts: 75
Hi to folks in usa,
wht do u think abt the abolishion of H1-B visas alltogether.Dont keep saying that america can not survive with out H1's as that is not an option this time. Companies found better option UTSOURCING. Unlike previous occasions big corps are not putting any fight to stop the bill. There is a heavy lobbying and pressure from labor groups in support of the bill.(Source: http://www.rediff.com/money/2003/jul/16bpo.htm
My Question:
Now do you know how long does it take for a bill from a proposal stage to acceptance stage. How much time do you think is at our hands?
[ July 16, 2003: Message edited by: Greg Valenti ]
[ July 16, 2003: Message edited by: Greg Valenti ]

SCJP 1.4
Mark Herschberg
Sheriff

Joined: Dec 04, 2000
Posts: 6037
Originally posted by Greg Valenti:
Hi to folks in usa,
wht do u think abt the abolishion of H1-B visas alltogether.Dont keep saying that america can not survive with out H1's as that is not an option this time.

It's always an option. Outsourcing will not be the panacea companies think it is. Whether they will need H1-Bs after it fails is anybody's guess.
Originally posted by Greg Valenti:

My Question:
Now do you know how long does it take for a bill from a proposal stage to acceptance stage.

Anywhere from 1 day (e.g. useless bills doing no more then denouncing the invasion of a country) to never. I don't even know if anyone's been able to model bill passage time (but it would be an interesting project).
--Mark
Bear Bibeault
Author and ninkuma
Marshal

Joined: Jan 10, 2002
Posts: 61010
    
  65

Outsourcing will not be the panacea companies think it is.

I'm hearing more and more horror stories about companies that bet their bottom line by outsourcing to 'cheap' overseas labor and are just now discovering that the quality of what they got isn't even worth the pittance they paid. Many are having to start from scratch at huge costs.
Oops.
bear


[Asking smart questions] [Bear's FrontMan] [About Bear] [Books by Bear]
Tim Holloway
Saloon Keeper

Joined: Jun 25, 2001
Posts: 16014
    
  20

I know that this sounds anal, but I really do prefer to make the distinction between outsourcing and offshoring. When you outsource, you're sending the job to someone who's competing at the same cost of living as you have and who's probably paying taxes into your tax system. When you offshore, the work is going to someplace where you can't make a competitive bid and the money, once gone is lost from the local economy.
I realized with some horror just this morning that at the most recent rates I've seen, an Indian computer programmer would have to have 3-4 years of experience (assuming no taxes, rent, etc.) just to have enough income to cover my household grocery bill. That's me, my wife and my cat. And I consider food to be CHEAP in this country!
A lot of offshoring projects will fail. For that matter, a lot of LOCAL projects, fail, but some of the offshoring projects will fail big because the logistics were more expensive than the bidders realized. However, this learning curve was also encountered - and passed - in the process of outsourcing manufacturing, so don't get your hopes up. The Gartner Group is predicting that 1 out of 10 IT jobs will be gone from the US by December 2004 (the word for that is "decimation"). I sincerely hope they're wrong.
Over the last month, I've seen about 6000 new job openings come up in India (which I consider an indication that the recession is finally coming to a close). During that same period, the only mass employment figures I've seen for the U.S. were losses: Estimated -800 offshored from Microsoft Washington, Texas, and North Carolina (this is a union estimate, so interpret as you wish). -250 tech documentation staff offshored from Boeing in Washington (Boeing's own figure), and today's -50 Netscape announcement (not offshored, just dead project).
We're bleeding. I just hope that as the economy improves and some of the offshore failures have to be brought back onshore that we'll finally see some U.S. hiring numbers, but that day isn't yet. Right now it's so bad that when one of the larger California Mortgage Industry companies pulled up roots and moved into town, not one "help wanted" ad ever appeared. They're simply using the existing infrastructure of a local acquisition.
H1-B never hurt me. In its heyday I was fully-employed and making quite decent money. When the bubble burst and I landed on the street, I quickly discovered that my most serious competition wasn't people in THIS country - who, after all have the same expenses as I do - but offshore firms bidding $25/hr to do contract work.


Customer surveys are for companies who didn't pay proper attention to begin with.
Derek Grey
Ranch Hand

Joined: Feb 09, 2002
Posts: 204
I realized with some horror just this morning that at the most recent rates I've seen, an Indian computer programmer would have to have 3-4 years of experience (assuming no taxes, rent, etc.) just to have enough income to cover my household grocery bill. That's me, my wife and my cat. And I consider food to be CHEAP in this country!


Now consider this:
Many engineers and programmers in Kuwait who make $200,000 per year would've gone mad seeing their projects being sent to United States where CHEAP programmers here do the same job for $60,000 per year.
Guess what, with 60,000 USD in Kuwait you can't do many routine things either.
It's all RELATIVE my friend.
Consider yourself lucky to have been born in a country where food is cheaper than most places. Don't abuse that privilege.
Just because people in India don't earn as much as you do RELATIVELY (yes, don't believe the media coz we arent' a developing nation anymore, we are a developed nation), doesn't make them or their work any smaller than yours.
Infact they say "Success of a person should be measured by the resources he has used to achieve it".

About programmers in India not doing a good job it is nothing but the usual tendency of a person to "generalize" while speaking. There are WORST, BAD, AVERAGE, GOOD and EXCELLENT programmers in every race, religion, region and community.
Sorry if I went overboard, I am just sick of people accusing us.
Natalie Kopple
Ranch Hand

Joined: May 06, 2003
Posts: 325
India does not want to send troops to Iraq. All India wants is U.S. jobs.
The more Americans are laid off and the more Americans die in Iraq, the more U.S. jobs can be filled by Indians.
Indians are poised for all jobs created when the U.S. economy turns around.
Sirisha Reddy
Ranch Hand

Joined: Jun 09, 2003
Posts: 75
Here is the status of the bill.
http://thomas.loc.gov/cgi-bin/bdquery/z?d108:HR02688:@@@X
STATUS:
Referred to the House Committee on the Judiciary.

Can anyone tell me what exactly it means? How long will the judiciary will take to decide on anything
Matt Cao
Ranch Hand

Joined: Apr 03, 2003
Posts: 715
Hi San,
Originally posted by San Tiruvan:
Many engineers and programmers in Kuwait who make $200,000 per year would've gone mad seeing their projects being sent to United States where CHEAP programmers here do the same job for $60,000 per year.
Guess what, with 60,000 USD in Kuwait you can't do many routine things either.
It's all RELATIVE my friend.

Kwaiti political system is a blanket system whereas American is not. In addition, Kwaiti core product happen to control the world economy. Wannabe Kwaiti?

Consider yourself lucky to have been born in a country where food is cheaper than most places. Don't abuse that privilege.

No, American fought for it and their government used to be smart too. They saw benefits in aiding the core price of produce.

Just because people in India don't earn as much as you do RELATIVELY (yes, don't believe the media coz we arent' a developing nation anymore, we are a developed nation), doesn't make them or their work any smaller than yours.

If India is a developed country, why her gray matters keep wandering the world for better opportunities. I have not seen any useful product from India neither except for extreme low-tech products like candle, broom, etc.

Infact they say "Success of a person should be measured by the resources he has used to achieve it".

That is so true.


About programmers in India not doing a good job it is nothing but the usual tendency of a person to "generalize" while speaking. There are WORST, BAD, AVERAGE, GOOD and EXCELLENT programmers in every race, religion, region and community.

It is part of human basic flaws. If the minor group do the bad things, the major group share the blame.

Sorry if I went overboard, I am just sick of people accusing us.

I have seen H1-B from every decent educated countries. But the majority still is Indians.
Regards,
MCao
[ July 16, 2003: Message edited by: Matt Cao ]
[ July 16, 2003: Message edited by: Matt Cao ]
Paul Pullman
Greenhorn

Joined: Jun 28, 2003
Posts: 19
Five years ago if you bought a Korea-made automobiles, you were buying basically a piece of junk. Now they are offering the most generous warranty for their products. Twenty-something years ago, Japanese automobiles just landed on American soil, now if you are buying an American model and thinking to keep it for a while instead of buying the Japanese you are buying yourself trouble. I can go on and on.
My point is that I would not count on the failure or poor quality of products generated by the Indians to keep my career going. I have been thinking that I would be lucky to keep my CS career going and income keeping up the inflation for the next 5 years even though I am doing work using the most current technologies, like J2EE and XML and so on. After that, the only jobs with some sort of security I can see would be from mowing laws to fixing air conditioners. We may even send patients to India to get their open heart surgeries done, I would be too old to become a surgeon anyway, so I do not care.
I am mentally prepared and try to get myself physically prepared also to do whatever to make a living 5 years later. However, I hope many of you are right and the CS job is promising on their way crossing the ocean to India, like so many of you are predicting, "I'll be back!".
Mark Herschberg
Sheriff

Joined: Dec 04, 2000
Posts: 6037
Originally posted by Paul Pullman:
My point is that I would not count on the failure or poor quality of products generated by the Indians to keep my career going.

I don't think anyone is claiming that Indian products are inherently inferior (well, I suppose I can only speak for myself). My claim is that any software project done overseas that isn't off-the-shelf is asking for trouble.
NB: it's not quite so black and white. But the more tied in the project is to a particular company or US-industry-specific need, the less its chances of success ones it crosses the ocean, irrespective of the shores on which it is produced.
--Mark
Sara Jahan
Ranch Hand

Joined: Apr 20, 2003
Posts: 120
I have a couple of questions:
1. What makes a job American? Are all the Microsoft jobs American because Microsoft was formed in the US? Then why does Microsoft has these Training Centres in India. People and companies paid money to learn these technologies. What about Pepsi bottling plants in India? I guess they should be going back to the US as well. The only difference between Pepsi and Microsoft in this scenario is that Pepsi has local consmers but Microsoft has global consumers. Isn't India part of the globe? India is good only for selling American products but not for making American products.
2. Where is all the money? What is the cause for this non-ending economic recession in the US? The economic health of a nation to a major extent depends on the economic health of its major companies. The companies say they have to resort to "off-shoring/outsourcing" to survive or even to remain leaders in their areas.
3. Why is this tendency to blame other nations for your own miseries? The Indian companies were there when IT was booming and it is there when IT is in a slump. But now all across Javaranch, you just hear one thing "India is bad". Did you do the same when IT sector was in its previous healthy state?
/Sara
Paul Pullman
Greenhorn

Joined: Jun 28, 2003
Posts: 19
... My claim is that any software project done overseas that isn't off-the-shelf is asking for trouble.

Mark,
No matter where I go, conferences, user group meetings, even lunches with colleagues, if the offsource topic came up it always implies to me that the quality of softwares done oversea will be low and is a big concern...
There are always troubles to do any non-trivial projects successfully, no mater where they are done. The infamous Chrysler Project came to mind. The soft side always is hard to grasp, either here or there. Correct me if I am wrong, the failure (or waste) of software development in the US has been historically about 75-80%, maybe even higher than that. I do not think that is a very high mark for anyone to hit.
From what I see it, the corporate America will offsource some trivial off-the-shelf projects, learn a lesson, and then hit the gas pedal in 5 to 10 years. After all, we saw foreign-made products on the shelves of KMart, Wal-Mart, and the like first; now they are everywhere.
I hope I am way off mark on this.
Paul
[ July 17, 2003: Message edited by: Paul Pullman ]
Tim Holloway
Saloon Keeper

Joined: Jun 25, 2001
Posts: 16014
    
  20

OK, the point isn't to villanize India or Indians. My own personal experience working with Indians has been pretty good. The issue I'm interested in isn't race or nationality, but offshoring. That is potentially just as big a problem for Indians as it is for Americans, since both Multi-national and Indian corporations are already looking at even cheaper countries than India. While China is a bad option for for English-language software, the African continent is not, and it's hardly been scratched yet. The only reason I name India is because - this week - that's where the jobs are moving.
Pepsi-Cola is a good one. There's likely a Pepsi bottling plant in Bangalore. But when I moved to this city, there was a Pepsi bottling plant within a short hike of where I lived. Local workers produce the product for local consumption and spen their money locally. True, the profits went elsewhere, but a sizable amount of the money stayed in the local economy. And both product prices and wages were in harmony with the local economy.
Offshoring is a different matter. One reason there's such an immense labour pool available in offshore countries is because there's relatively little local consumption.
There's more at stake here than just a lot of overpriced obnoxious Yanks whining about having their porridge stolen, however. There's an old adage in Economic circles that when the U.S. catches a cold, the world gets pneumonia. You need look no further than this winter's shares prices in InfoSys, WiPro and Satyam to see that in action. If we succeed in destroying the U.S. middle class - which is where most of the offshorable jobs are - then we not only hurt the U.S. economy, but that of the entire world.


As I've said, I have few complaints about the Indians I've worked with, any operation that's run primarily to be cheap - no matter what country it's run in - is going to produce lower-quality products. That doesn't mean things have to stay that way.
Korea got into the Auto and Electronics industries because Japanese products had moved out of the "cheap junk" market and become expensive - taking wages with them (or vice versa). Now Korea is well on the way to doing the same and other countries are taking its place. And so it goes for as long as there's a place left that's got a lower-priced labor market. Which is ultimately, I think, a good thing.
Mark Herschberg
Sheriff

Joined: Dec 04, 2000
Posts: 6037
Originally posted by Paul Pullman:

There are always troubles to do any non-trivial projects successfully, no mater where they are done. The infamous Chrysler Project came to mind. The soft side always is hard to grasp, either here or there. Correct me if I am wrong, the failure (or waste) of software development in the US has been historically about 75-80%, maybe even higher than that. I do not think that is a very high mark for anyone to hit.

I've seen it listed as anywhere from 2/3 to 90%. I'm somewhat hesitant of the means by which the data was collected, but I'm generally willing to believe that projects can generally be considered to have a low chance of success.
What was the Chrysler Project? I'm not familiar with it.

Originally posted by Paul Pullman:

From what I see it, the corporate America will offsource some trivial off-the-shelf projects, learn a lesson, and then hit the gas pedal in 5 to 10 years. After all, we saw foreign-made products on the shelves of KMart, Wal-Mart, and the like first; now they are everywhere.

I see the opposite happening. American will send overseas a great many projects ("we've got to tighten our belts, you know") and most will fail. Managers will get burned and the number will drop 7-10 years out. A second wave will start in about 12 years. Maybe we'll have learned by then. (And maybe JavaRanch will have archieved this message so I don't ahve to eat my words if I'm wrong. :-p )
There's a big difference between material goods and software; two differences actually. First, I (or rather the industry) knows how to specify a Barbie's Dream House or a power scooter. We've been designing those for years and have standards. The plans can be drawn up in the US and sent overseas with minimal uncertainty in the design. Most comapnies can probably safely cap/estimate the communications overhead (e.g. this will take X hours of phone calls, given these designs). I don't know any software project manager who could do that. We don't know how to specify our systems well.
Second, software is not really an end product. Software is a tool used in a new process. In fact, software is part of a process change. The roots of a process is typically cultural, legal, and historical. Foreigners will have trouble understanding this (that is, anyone in nation A will have trouble understanding the process and motivations for it in nation B). This further inhibits communication.
In short, the only software that can be sent overseas is that which can be well specified.

--Mark
Al Newman
Ranch Hand

Joined: Mar 30, 2003
Posts: 716
Mend it, don't end it! According to the newspiece linked, the upper limit on H1B's has reverted to 65,000 a year from 195,000 where it was put in response to the boom and the resultant labor shortage. So the "problem" (if there ever was one), is 2/3rd solved.
Alan Greenspan recently said that growth in the economy could be 4.75% next year. I think we're going to have a rapid recovery, so it make no sense to make immigration policy for recession.
As long and tough as this recession has been, I think this recovery will be sharp as it was in the early 80's.
Don't forget that other professions use the H1B, including to get nurses into the US to work.
The H1B permits smart immigrants into the US. This is a good thing, in my humble opinion.


SCJP1.4, SCWCD
Vinod Jon
Greenhorn

Joined: Jul 17, 2003
Posts: 3
Originally posted by Natalie Kopple:
India does not want to send troops to Iraq. All India wants is U.S. jobs.

Iraq is a burden U.S added to its list, so it should not go around asking other countries to help. I don't want to discuss whether it was legitimate for US to invade Iraq, but US undermining UN is not correct, this could lead to a false precedence and UN could become another League of nations, which no one want's anther big war. It took Europe two big wars for europe to realise effect of war all that will go wasted if other countries gets inspried by US actions. Do you need another war outside your home ?.
One more thing you have to realise, a captialist country will never give any thing for free, US business interest in India (on a long run) is more than India's interest in US. If US government instruct companies to stop outsourcing, then Indian Government will force cococola, pepsi, kfc, Mcdonals, pizza hut, ford etc to close their shops in India, Indian govt has proved it won't allow US to take India for granted by not sending troops to Iraq. So this is a tough decision for the US govt. Though abolishing H1B could solve this problem at present, but in a long run it may cause more damage to american business. So US govt should be smart and careful when they decide on this.

With regard to quality of software produced in India, I admit it is bit inferior to what is produced here in US. One reason being Indian industry (not just the IT induatry) lack professionaism to some extent, that is what you can expect from a country semi-socialist country at it was till 1990, but now things have greatly changed between then and now. Today product comming out of India are close to international standard than it was then. So this could be the right time for outsourcing wor to India, atleast that's what US corporate is feeling. So this is one of the toughest decision US will be making in comming days/months/years.
Michael Bronshteyn
Ranch Hand

Joined: Mar 26, 2002
Posts: 85
If US government instruct companies to stop outsourcing, then Indian Government will force cococola, pepsi, kfc, Mcdonals, pizza hut, ford etc to close their shops in India,

I just can't imagine how would American people live without all of that crap being sold in India.
Btw, all of those businesses employ local people.


Michael
SCJP2
Paul Pullman
Greenhorn

Joined: Jun 28, 2003
Posts: 19
Mark,
What was the Chrysler Project? I'm not familiar with it.

It is considered to be the birth place of XP. I saw it being mentioned from time to time in articles talking about development process and XP in particular. Kent Beck could tell you a lot more in this recent interview, link:
http://www-106.ibm.com/developerworks/java/library/j-beck/
No disagreement on your comments on the soft side of the software development, which differs from the traditional manufacturing. Is there something
in the cooking to better tackle this? The MDA speccification from OMG came to mind. Thoughts?
Paul
Mark Herschberg
Sheriff

Joined: Dec 04, 2000
Posts: 6037
Originally posted by Paul Pullman:
It is considered to be the birth place of XP...

Oh, the C3 project. Yeah, it's in some of the XP books. It's not clear to me that it was that horrific a project, just one that happens to be widely known (most companies don't like to talk about their failures). I can think of a number of bigger failures.
Originally posted by Paul Pullman:

No disagreement on your comments on the soft side of the software development, which differs from the traditional manufacturing. Is there something
in the cooking to better tackle this?

Well, my upcoming book comes to mind... :-)
Seriously, there's no silver bullet. I don't see any tool or process on the horizon which will magically solve these problems (even video conferencing, although it will help). It will require a cultural change among developers, sponsors, and users (or user proxies).
--Mark
Paul Pullman
Greenhorn

Joined: Jun 28, 2003
Posts: 19
Well, my upcoming book comes to mind... :-)

Mark,
Look forward to it.
Paul
Axel Janssen
Ranch Hand

Joined: Jan 08, 2001
Posts: 2164
Originally posted by Vinod Jon:

US business interest in India (on a long run) is more than India's interest in US.

Without any cynism, just for facts:
Probably in such a long run that we'll all be dead.
The important point is import buying power.
Its much too late to check international trade statistics, but even with US population being a quarter of a fifth of indian population, americans will import more stuff for a long period of time.
HS Thomas
Ranch Hand

Joined: May 15, 2002
Posts: 3404
In short, the only software that can be sent overseas is that which can be well specified.

The trend of thought is that businesses should not be concentrating on non-strategic activities.
Hence these can be outsourced i.e both the Business process and the software.
That's not a new thing: e.g document production, cheque clearance has been done outside the company for years. What is new is that it can be done offshore now.


Business Process Outsourcing: Should you believe the hype?
To BPO or not to BPO?


It's a market that was worth �3.5bn in 2001 and is predicted to be worth over �10bn in 2005... That's an annual growth rate of over 30 per cent. These are the kind of statistics that tend to grab the headlines, and business process outsourcing has certainly had its fair share in recent times.

But is the hype justified? Is it really 'the next big thing', or just another meaningless marketing term? Should your company be looking at it - and if so, why?

Ovum Holway, whose analysts came up with the figures for the UK market above, describe business process outsourcing (BPO) as "Long term contracting out to an external company of the management and delivery of business processes."

That may sound obvious, but it's reassuring to know that this is one three letter acronym that does exactly what it says on the tin.

So is it a new name for an old phenomenon? Not really. Banks have been outsourcing cheque clearing operations for years; HR departments have used third parties to provide payroll services for a long time; both examples of BPO, a term which has been knocking around in the industry for at least five years.

Nevertheless, the hype around it has definitely grown of late, it is certainly becoming more popular - and the state of the economy has a lot to do with that.

Every company is looking to cut costs these days, and it's the one factor you'll hear mentioned most often in any BPO discussion.

Liberata specialises in working with companies in the financial services sector. Mike Lusby, business development director of Liberata Life, Pensions & Investments, said: "Cutting costs is what it's all about. Five years ago, you wouldn't have found any life and pension outsourcing deals. But we're expecting a huge acceleration in growth over the next five to eight years."

Ramkumar Akella, regional manager for Europe of offshoring specialist Infosys, said: "There is pressure on the margins of all companies in terms of increasing competition. Everyone's looking to cut costs in the first year, and then gain year-on-year productivity gains. That creates a compelling business case [for BPO]."

Les Mara, executive director of Cap Gemini Ernst & Young UK, agreed: "When we talk to companies, it is usually an FD-led discussion. They want to reduce costs, or turn fixed costs into variable costs. Given the current state of the economy, all companies are trying to do this, while improving the efficiency of their administrative processes."

The latter point is crucial, despite the emphasis on bottom line issues. As Lusby also went on to say, cost isn't the only factor. BPO allows you to focus on your core activities and get rid of those you'd deem as a chore. Lusby said: "We prefer to talk about strategic and non-strategic. No company should be interested in retaining control over non-strategic activities."

That's partly a cost issue - a service provider which specialises in a particular process or a range of similar processes will give you access to economies of scale you couldn't possibly match in-house - but it's also about gaining access to specialist expertise and, hopefully, a better quality of service.

This recognition is helping the BPO bandwagon gather pace. Companies are becoming more sophisticated in working out what's core, and what's not, and are indeed looking at issues other than cost. Philip Heggie, VP UK and Europe Global Outsourcing, Unisys, said: "The use of BPO has become a legitimate business strategy. There are numerous examples in the UK of BPO deals that five years ago would have been considered 'sacred cows'. These include finance, HR, banking back office and insurance back office processes."

But now, all these are fair game - and all have something in common. When asked if certain business processes are more suitable outsourcing targets than others, Heggie said: "Processes that are structured and repeatable are particularly suitable for outsourcing, as are processes that would benefit from the economies of scale and scope that an outsource service provider is able to provide. I'd also include processes that are core but not critical and that are usually back-office oriented, for example cheque processing and claims processing."

There are many benefits to be reaped from a healthy BPO relationship. Ovum believes that freeing up management time, speeding up time to market, management of rapid growth, and better risk management are all key potential plus points.

Gartner also thinks the first of these is crucial. In a recent BPO report, the analyst house said: "An additional driver for BPO... and the motivation of the CEO to outsourcing business processes is the need to find a way of capitalising on their most scarce resource. What is this resource? Cash? Ideas? No, it's the time of good managers."

The report continues: "Management bandwidth is a scarce resource and CEOs want to free up the time of key managers so they may work on the issues that make a vital competitive difference to the business. In most organisations the managers are busy trying to juggle broken processes, dealing with day-to-day low-value issues rather than having time for vision and leadership. If this is not the case in your organisation, as your managers are able to focus on leading the company forward, perhaps you are not a good candidate for BPO."

Whether this applies to your company or not, most analysts and industry experts warn against a blinkered focus on monetary issues. According to Gartner, European businesses wasted around E6bn on badly structured outsourcing deals in 2002, largely because so many were designed to save money in the short term and ignored longer-term business requirements. Remember, cheaper isn't always better.

And there are some other traps lurking to catch the unwary. Unisys' Heggie warns: "Failing to have a clear sourcing strategy is one potential pitfall... as is not being adequately prepared for the long, complicated procurement process involved and misunderstanding the real 'partnership' needs of each partner."

Indeed, that procurement effort should span many months. Liberata's Lusby said: "Don't under-estimate the amount of time it takes to go through the whole process."

Ovum again has something to say on the risk front. Its list of thorny BPO issues includes: supplier survival, change management, contract lock-in, security/confidentiality, decline in performance, and a loss of control - all familiar arguments to the anti-IT outsourcing brigade, but worth repeating.

Gartner identifies another potential problem. Just as the recession is affecting end user organisations, the suppliers are also having to take drastic action - and over-selling has become a very real issue. Its report advises: "Understand what BPO is - an increasing number of vendors are using it as a 're-labelling' exercise... Know the market - there are a few 'old hand' BPO vendors in Europe. Sales prowess may outstrip delivery capability."

To avoid many of these traps, Gartner has come up with a simple, three-point plan to improve the structure of an IT outsourcing deal, but which apply to BPO deals as well:

* Take a long-term view and look at your service provider as part of your company (what Infosys' Akella calls the "extended enterprise" concept)
* Build deals that can cope with continuous change
* Invest in the skills, resources and processes needed to manage the contract.

Sounds easy? Clearly it's not, but with some good planning, careful management and maybe a little luck, BPO could well work for your organisation.

But who will work well with your organisation? As the focus of BPO is on the BP bit and not IT, there are some new names to conjure with, although Ovum's list of the likely winners on the supply side of the equation do include the usual suspects with a background in 'traditional' IT outsourcing - hardly surprising given the IT-intensive nature of many of the processes companies are outsourcing these days. Capita on its own accounts for 15 per cent of the market, while Cap Gemini Ernst & Young, CSC, EDS and IBM are all extremely active. Unisys employs around 6,000 BPO staff.

But then the business service players are joining in (Amey, Hays, Serco); the consultancies too (Accenture, Deloitte et al); the transaction processing specialists are taking a slice of the pie (ADP, Centrefile, Ceridian); and last but not least are the new breed of pure-play BPO outfits (e-peopleserve, Xchanging).

Come 2005, Ovum reckons there'll be even more new names near the top of the supply side list: pure-play BPO outfits such as Exult; new UK entrants such as ACS and Convergys; and offshore players such HCL, Infosys, Satyam, and Tata.

So, come 2005, will your organisation be on the BPO end user list? Is it all hype, or is it the next (old) big thing? Only you can answer that... and, as ever, we'd be delighted to hear your views on the subject. Email us at editorial@silicon.com.
Graham Hayday


regards
[ July 18, 2003: Message edited by: HS Thomas ]
Matt Cao
Ranch Hand

Joined: Apr 03, 2003
Posts: 715
Hello,
I think the original topic was H1-B, but San wandered toward offshoring, I have tried to breaking each paragraph up for the sake of clarity.
If H1-B program stopped, so what? The overseas professional will not come to US, is that going to bring back employment that you lost? Remember the seed of offshoring indisguise of outsourcing already been implanted. Western countries may well admitted that we lost to India over global strategies. The only way out is more regulations into offshoring, some companies still do because they are the underdog. But we try to prevent or at least discourage the topdog companies to follow the same path.
On the LA Times today, the Washington top economics wonder about the new phenomenon that economy growth but job is not gained. They have never experienced since WWII. I think we should nominate Tim Holloway to Washington DC for snapping those guys head a little bit.
Regards,
MCao
[ July 18, 2003: Message edited by: Matt Cao ]
Gayathri Prasad
Ranch Hand

Joined: Jun 25, 2003
Posts: 116
"Integrated Nation Deserving International Applaud-INDIA" as defined by Koffi Annan is my India. Everybody talks about Global village and competitve advantage,Overall Cost Leadership etc.
Strategic concepts.Any business head or the core people are not dumb guys to hire people who have no quality work. This is where the the most important factor comes into picture Differeniation when two or more professionals are almost the same in the quality work they put in,obviously the company would hire the one where the company makes maximum profit from him/her. People who boast on Grocery bills and who are running a parallel between their grocery bills and the living the Indians are making,better care for the humanitarian activities like funding orphans,mentally retarded,oldage homes. No body asks how much one made. An individual should be remembered by the way he/she touched the hearts of people. You live only once ... try to see what is the value of your life to others...Lets make the a Earth a better place to live....
Love,
Gaya3
Al Newman
Ranch Hand

Joined: Mar 30, 2003
Posts: 716
If H1-B program stopped, so what? The overseas professional will not come to US, is that going to bring back employment that you lost? Remember the seed of offshoring indisguise of outsourcing already been implanted. Western countries may well admitted that we lost to India over global strategies. The only way out is more regulations into offshoring, some companies still do because they are the underdog. But we try to prevent or at least discourage the topdog companies to follow the same path.

I think your first point is well-taken. I think the H1B program helps bring some of the best and brightest into the US to improve the quality of the US labor market. Generally a positive from what I've seen of the Indian, Chinese, and Eastern Europeans whom I have worked with professionally.
I'm not sure the second assertion (that US companies have 'lost out' to India in global strategy. Who is in control of most of these relationships? Has Micro$oft lost control of Windows or their other products because they have moved to India? Has Sun lost Java to India?
I think the real issue here is whether US programmers have lost out, and if so whether it is a permanent loss or more of a cyclical thing. The real answer is "ask me in 5 years". I don't think we can know for sure right now.
But.... The current sitiuation bears a lot of similarity to that of a decade ago. There was considerable outsourcing then, plus a lot of Indian contract labor brought to the US for derisory wages (by US standards). I worked with a number of them at the time. I don't think that the cost savings panned out then for various reasons mostly because when costs were cut the odds of project success also fell - then.
Another thing which seems clear is that to the degree Indian outsourcing succeeds there will upward pressure on the wages of Indian programmers. Something which has already happened. During the early 90's Indian programmers were paid at about 10% of US wage levels. Now Indian wages are between 40 and 50% of US levels, I believe. Of course they are worth more than they were then, also. Getting better at the job.
On the LA Times today, the Washington top economics wonder about the new phenomenon that economy growth but job is not gained.

New? Perhaps these are young economists?
Something similar happened in the early 90's, when the recession was also shallow and the take-off slow. In the tech sector the recession has been long and steep of course. But I am seeing signs that the recovery will also be sharp and steep, at least in my corner of the world it appears so......
Matt Cao
Ranch Hand

Joined: Apr 03, 2003
Posts: 715
Hi Alfred,
Perhaps you are right. I am willing to wait for 5 more years but not so sure about my heart. Every Friday the company is so quiet you can hear coworkers heartbeats because it is the time for the loud speakers anounce employee id(s) come to conference room and wait for HR rep.

The following economists made the new but I have not checked their backgrounds yet. John E. Silva chief economist of Wachovia Corp. and Jeffrey A. Frankel of Havard economist.
Regards,
MCao
Mark Herschberg
Sheriff

Joined: Dec 04, 2000
Posts: 6037
Originally posted by Matt Cao:
Every Friday the company is so quiet you can hear coworkers heartbeats because it is the time for the loud speakers anounce employee id(s) come to conference room and wait for HR rep.

Wow, very Brave New World. :-) This company can use some lessons on morale building.
--Mark
Matt Cao
Ranch Hand

Joined: Apr 03, 2003
Posts: 715
Hi Mark,
My manager and I try to come up with a plan hiring more attractive female engineers and drop-dead gorgeous HR reps. That way we do not have to give a pep rally all the time.
The new hired female engineers will spread out to all departments, that way the male counterpart just work without remember time to go home or think about bonus. Even if they have to make the final trip, they still greet by the women of their desires.
Regards,
MCao
 
Don't get me started about those stupid light bulbs.
 
subject: H1-B will be a history soon. Any comments??