BizTech

Send Jobs to India? Some Find It's Not Always Best

http://www.nytimes.com/2004/04/28/technology/28SOUR.html

Send Jobs to India? Some Find It's Not Always Best
By EDUARDO PORTER

New York Times
Published: April 28, 2004

Even as the prospect of high-skilled American jobs moving to low-wage countries
like India ignites hot political debate, some entrepreneurs are finding that
India's vaunted high-technology work force is not always as effective as advertised.

"For three years we tried all kinds of models, but nothing has worked so far,"
said the co-founder and chief technology officer of Storability Software in
Southborough, Mass. After trying to reduce costs by contracting out software
programming tasks to India, Storability brought back most of the work to the
United States, where it costs four times as much, and hired more programmers
here. The "depth of knowledge in the area we want to build software is not good
enough" among Indian programmers, the executive said.

If it sounds like "Made in the U.S.A." jingoism, consider this: The
entrepreneur, Hemant Kurande, is Indian. He was born and raised near Bombay and
received his master's degree from the Indian Institute of Technology in that
city, now known as Mumbai. Mr. Kurande is not alone in his views on
"outsourcing" technology work to India. As more companies in the United States
rush to take advantage of India's ample supply of cheap yet highly trained
workers, even some of the most motivated American companies — ones set up or run
by executives born and trained in India — are concluding that the cost advantage
does not always justify the effort.

[...]

Global Repositioning... Who's safe?

http://www.oaklandtribune.com/Stories/0,1413,82~10834~2047882,00.html

Jobless Stats from the AFL-CIO

Take a look at this site for up to date job and jobless stats in the US.

http://www.showusthejobs.com/jobfacts/

Hacking danger for outsourced records hard to gauge

Hacking danger for outsourced records hard to gauge

Carrie Kirby, Chronicle Staff Writer

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2004/03/28/MNG573MCQG25.DTL

Ankit Fadia, an 18-year-old freelance security tester, has successfully broken into more than a dozen computer networks in India. But the Stanford freshman really doesn't think that's much of an accomplishment.

"As far as computer security is concerned, India is really bad,'' said Fadia, who published three books about computer security before leaving his native India. "Security is not a high priority for Indian companies."

Outsourced UCSF notes highlight privacy risk

LAZARUS AT LARGE

SPECIAL REPORT
Looking Offshore
Outsourced UCSF notes highlight privacy risk
How one offshore worker sent tremor through medical system

David Lazarus
Sunday, March 28, 2004

http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2004/03/28/MNGFS3080R264.DTL

Looking Offshore

In an ongoing Chronicle series on the ramifications of shifting U.S. jobs and services overseas, this installment focuses on the threat to individual privacy when companies sendsensitive financial and personal data offshore. Read the complete series atwww.sfgate.com/business/

--------------------------------------------------------------------------------
Lubna Baloch sat in her office in the sprawling Pakistani commercial center of Karachi and gazed at the e-mail she'd composed. She tried to imagine the reaction half a world away when the people at UC San Francisco Medical Center saw what she'd written.
The famous U.S. hospital would have to take her seriously, Baloch knew, when it realized she was prepared to post its confidential patient records on the Internet. That is, unless UCSF helped her get the money she was owed from the mysterious Tom Spires, her link in a long chain of medical transcription subcontractors.

Go the URL to read more.

Top economists and high-wage earners rethink OFFSHORING

In an article on offshoring, the Christian Science Monitor finds top economists rethinking the old equations, and those who earn over $100,000 a year less enthusiastic about the trend to send tech jobs abroad.

http://www.csmonitor.com/2004/0305/p01s03-usec.html

Outsourcing is Becoming a Harder Sell in U.S.

http://www.nytimes.com/2004/03/06/business/06outsource.html

First National Anti Offshoring Bill Introduced

NEW YORK (Reuters) - About 50 U.S. House of Representatives members plan to
introduce a bill on Wednesday that would deny U.S. companies federal
financing and loan guarantees if they shift U.S. jobs overseas.

It's the first national attempt to deal with the issue of "offshoring," or
sending U.S. manufacturing and service jobs to lower-cost venues abroad.
About 20 states have proposed laws that to ban the offshoring of state
contracts.

For example, the bill would require a US Export-Import Bank loan applicant
to specify the number of employees in the United States and abroad. If the
number of non-U.S. workers increases while U.S. worker numbers fall, the
loan would be canceled.

More at
http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=4489321

Debate Over Exporting Jobs Raises Questions

The Policy Wonks are now interested: http://www.nytimes.com/2004/02/23/technology/23neco.html

Meet the Zippies

OP-ED COLUMNIST
Meet the Zippies
By THOMAS L. FRIEDMAN

Published: February 22, 2004

Columnist Page: Thomas L. Friedman

BANGALORE, India

We grew up with the hippies in the 1960's. Thanks to the high-tech revolution, many of us became yuppies in the 1980's. And now, fasten your seat belt, because you may soon lose your job to a "zippie" in the 2000's.

"The Zippies Are Here," declared the Indian weekly magazine Outlook. Zippies are this huge cohort of Indian youth who are the first to come of age since India shifted away from socialism and dived headfirst into global trade, the information revolution and turning itself into the world's service center. Outlook calls India's zippies "Liberalization's Children," and defines one as "a young city or suburban resident, between 15 and 25 years of age, with a zip in the stride. Belongs to generation Z. Can be male or female, studying or working. Oozes attitude, ambition and aspiration. Cool, confident and creative. Seeks challenges, loves risks and shuns fears." Indian zippies carry no guilt about making money or spending it. They are, says one Indian analyst quoted by Outlook, destination driven, not destiny driven; outward, not inward, looking; upwardly mobile, not stuck-in-my-station-in-life.

Got to NYT for more: http://www.nytimes.com/2004/02/22/opinion/22FRIE.html?hp

Many New Causes for Old Problem of Jobs Lost Abroad

From Sunday's NYT....Article points out the vast amount of legislation currently being proposed in the US to curtail offshoring, and discusses the kinds of skills you need to keep working in the US during this time of enormous change.

http://www.nytimes.com/2004/02/15/business/15JOBS.html?pagewanted=1

Bush, Adviser Assailed for Stance on Offshoring Jobs

Bush, Adviser Assailed for Stance on 'Offshoring' Jobs

By Jonathan Weisman
Washington Post Staff Writer
Wednesday, February 11, 2004; Page A06

Democrats from Capitol Hill to the presidential campaign trail lit into President Bush's chief economist yesterday for his laudatory statements on the movement of U.S. jobs abroad, seizing on the comments to paint Bush as out of touch with struggling workers.

"They've delivered a double blow to America's workers, 3 million jobs destroyed on their watch, and now they want to export more of our jobs overseas," said John F. Kerry, the Massachusetts senator and front-runner for the Democratic presidential nomination. "What in the world are they thinking?"

Go to the URL below for the full story.

http://www.washingtonpost.com/wp-dyn/articles/A30194-2004Feb10.html

Globalization, Offshoring US Jobs and The Presidential Hopefuls

http://www.nytimes.com/2004/01/31/politics/campaign/31TRAD.html

Offshore Labor Drove Firm to Brink

Offshore labor drove firm to brink
By Matt Marshall
Mercury News

Go ahead, join the lemmings in the rush to India.

But if you're a Silicon Valley entrepreneur or venture capitalist still
considering it, contemplate the over-the-cliff tale of Ishoni Networks.

Last month, the Santa Clara start-up filed for bankruptcy, a victim of
moving to India too quickly.

http://www.mercurynews.com/mld/mercurynews/business/7659988.htm

Who Wins and Who Loses When Jobs Go Overseas?

For a policy debate on the subject of offshoring moderated by the New York Times, go to:

http://www.nytimes.com/2003/12/07/business/yourmoney/07out.html

The Rise of India

The Rise Of India by Manjeet Kripalani and Pete Engardio, with Steve Hamm in NY

Growth is only just starting, but the country's brainpower is already
reshaping Corporate America

"Pulling into General Electric's (GE ) John F. Welch Technology Center, a
uniformed guard waves you through an iron gate. Once inside, you leave the
dusty, traffic-clogged streets of Bangalore and enter a leafy campus of low
buildings that gleam in the sun. Bright hallways lined with plants and
abstract art -- "it encourages creativity," explains a manager -- lead
through laboratories where physicists, chemists, metallurgists, and computer
engineers huddle over gurgling beakers, electron microscopes, and
spectrophotometers. Except for the female engineers wearing saris ...."

For the whole story, please go to Time Magazine online.

Dell brings them back

http://www.sfgate.com/cgi-bin/article.cgi?file=/news/archive/2003/11/24/financial1350EST0129.DTL&type=tech

Read about Dell bringing back offshore jobs!

The Hidden Costs of IT Outsourcing

The Hidden Costs of IT Outsourcing

By Olga Kharif
October 27, 2003

Labor costs in traditional outsourcing powerhouses such as
India are escalating. Already, EDS vice president Dan
Zadorozny said, an entry-level programmer costs more there
than in Argentina -- which is where he's increasingly
sending clients.

[article covers various problems surfacing with
offshoring]

Full story at:
http://www.ecommercetimes.com/perl/story/31955.html

No smooth sailing for offshoring

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2003/11/16/BUGTR32G6L1.DTL

No smooth sailing for offshoring
Moving IT work overseas can have unexpected costs

John Shinal, Chronicle Staff Writer Sunday, November 16, 2003

U.S. companies sending information technology work overseas merely to cut salary costs may find their savings are either disappointing or short- lived.

The reason is that the unexpected costs of moving IT jobs to India and China, including skyrocketing salaries, are changing the financial equation of offshoring just as U.S. executives are rushing to adopt the practice.

Interviews with business consultants, corporate executives, market analysts, venture capitalists and others who have looked closely at the trend revealed that much of the conventional wisdom about moving IT work offshore is, well, off base.

"Too many companies are viewing offshoring as a tactical decision," said Gregg Rock, president and founder of BrainStorm Group Inc., an offshore consulting firm in Boston.

For more, go to the URL above.

Caught in the Pull of Globalization

http://www.bayarea.com/mld/mercurynews/2003/11/10/news/7225976.htm
--------------------------------------------------------------------------------

Posted on Mon, Nov. 10, 2003

Caught in the pull of globalization
ECONOMISTS SAY FLOW OF WORK OVERSEAS IS UNSTOPPABLE -- AND HEALTHY FOR U.S.
By Aaron Davis and Margaret Steen
Mercury News

Tech-woker activist Natasha Humphries outside the offices of the Communications Wokers of America in San Jose. Humphries, along with other local activists from TechsUnite.org plan organized protests against U.S. companies that outsource labor.

When Natasha Humphries went to Bangalore, India, in December to train Indian contract workers to do quality-assurance testing for her employer, Palm, she realized that her own job coordinating that work could be done by local workers there, as well. ``I'm fairly intuitive -- I saw the writing on the wall,'' said the 30-year-old Santa Clara resident.

Humphries was indeed laid off in August. Her former employer, now known as palmOne, says her layoff was not directly related to its outsourcing in India. Humphries, however, disagrees. And in unemployment, she has become an activist.

``I am not angry with companies for trying to conserve costs, but at the same time, we do have to acknowledge that it's going to create more problems for us domestically if we don't create more jobs for U.S. citizens,'' said Humphries in an interview last month before she testified in front of a congressional committee examining the effect of white-collar jobs moving overseas.

For more, go to the URL above.

Credit Agencies Sending our Files Abroad

LAZARUS AT LARGE
Credit agencies sending our files abroad

David Lazarus

Friday, November 7, 2003

Two of the three major credit-reporting agencies, each holding detailed files on about 220 million U.S. consumers, are in the process of outsourcing sensitive operations abroad, and a third may follow suit shortly, industry officials acknowledge for the first time.
Privacy advocates say the outsourcing of files that include Social Security numbers and complete credit histories could lead to a surge in identity theft because U.S. laws cannot be enforced overseas.
For their part, the credit agencies say the trend is a necessary cost- cutting move in light of new legislation

To read the article, go to:
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/11/07/MNG4Q2SEAM1.DTL

SBC Outsouring to India

The original article can be found on SFGate.com here:
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/10/31/BUG3J2N1CV1.DTL

----------------------------------------------------------------------
Friday, October 31, 2003 (SF Chronicle)
SBC quietly spins off jobs to India
David Lazarus

Let's continue our exploration of personal information slipping abroad by
taking a close look at one company's efforts to outsource tech operations
to India.
The company in question is telecom giant SBC, which, according to
confidential internal documents, has hired two outsourcing firms in India
to take on a variety of tasks, ranging from "application enhancement and
maintenance" to "new application development."
SBC is by no means alone in looking overseas for cut-rate tech help.
Virtually every major U.S. corporation is outsourcing at least a portion
of its operations as a way to slash costs and boost profits....

Go to SF Gate URL for more.

BofA to send tech work, data to India

Do you want your personal financial data to be accessible in a country that rarely enforces privacy laws?

The original article can be found on SFGate.com here:
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2003/10/29/BUGL42L7N91.DTL

----------------------------------------------------------------------
Wednesday, October 29, 2003 (SF Chronicle)
BofA to send tech work, data to India
David Lazarus

Bank of America snagged a lot of headlines when it announced this week
that it will create the second-biggest U.S. bank by acquiring FleetBoston
Financial for about $47 billion.
But virtually no attention was paid just days earlier when BofA said it
will move more operations abroad by setting up a subsidiary in India next
year to handle key tech functions, many involving sensitive customer
information....

David Lazarus' column appears Wednesdays, Fridays and Sundays. He also can
be seen regularly on KTVU's "Mornings on 2." Send tips or feedback to
dlazarus@sfchronicle.com.
----------------------------------------------------------------------
Copyright 2003 SF Chronicle

Reverse Offshoring: From China to SC

The article that begs the question, Could we save American jobs by inviting international companies to hire US workers in the US? Could this work for white collar jobs at higher salaries?

When Jobs Move Overseas (to South Carolina)

CAMDEN, S.C.
By YILU ZHAO

Published: October 26, 2003

WHILE many American manufacturers look to China as a place to make their products with cheap labor, an odd turnabout is taking place in this small town northeast of Columbia.

There, one of China's best-known companies, the Haier Group, is churning out refrigerators at a factory staffed by American workers.

The decision to build in South Carolina was a step toward the company's goal of making Haier a household name in America, like Whirlpool or Maytag. Haier argues that the plant saves transportation costs.

To the company, which had $8.5 billion in revenue last year, the plant is at the core of its vision to expand in the United States. The factory, completed in 2000 at a cost of $40 million, is designed to respond nimbly to American retailers, who stock little inventory but want to replenish supplies quickly when products run out, said David Parks, a senior vice president of Haier's American unit. Shipping refrigerators from Asia can take up to six weeks.

For the full story, go to: http://www.nytimes.com/2003/10/26/business/yourmoney/26chin.html?pagewanted=1

White Collar Blues

White-Collar Blues
Professional jobs shifting overseas

The loss of more than 2 million jobs so far in the Bush
administration has been a particular source of anger among
Democrats. This was highlighted in early October with an
announcement by air-conditioner maker Carrier that it was moving
1,200 jobs from Syracuse overseas—a major blow to that upstate New
York city.

Continued job losses during what is supposed to be a slow recovery
are leading to calls for new laws to protect American manufacturing.
In fact, there is a much graver threat to American workers.

For the complete story, see
http://inthesetimes.com/comments.php?id=412_0_2_0_C

Laid Off Take Survival Jobs

Laid Off Take Survival Jobs
USA Today Story 10/23/03

http://pqasb.pqarchiver.com/USAToday/429515091.html?did=429515091&FMT=ABS&FMTS=FT&desc=Laid-off+take+survival+jobs+to+pay+the+bills+

"....Two years ago, John Van Ness earned six figures and supervised
employees. Now, the laid-off Sun Microsystems manager sells plumbing
supplies at Home Depot.

"It's a job; it's a paycheck," says Van Ness, 57, of San Jose,
Calif., who lost his job in 2001 and has seen his income drop from
$125,000 a year to about $25,000. "But I'd like to get back to
something I really enjoy doing."

It's a growing lament. More workers who find themselves unemployed
are turning to survival jobs, taking hourly or part-time work to
make ends meet as the economic rebound drags on....."

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Laid-off take survival jobs to pay the bills ; Professionals turn to entry-level work:[FINAL Edition]
Stephanie Armour. USA TODAY. McLean, Va.: Oct 23, 2003. pg. B.01

Column Name: COVER STORY
Section: MONEY
ISSN/ISBN: 07347456
Text Word Count 1608

Abstract (Article Summary)
Another strong allure of survival jobs is health benefits. The number of Americans without health coverage jumped 5.8% in 2002, to 43.6 million, the largest increase in a decade, according to the Census Bureau. Some unemployed workers get health coverage through their spouses or COBRA, which gives some downsized workers the ability to continue group health coverage for limited periods at their own expense.

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COPYRIGHT © 2003 USA TODAY, a division of Gannett Co. Inc.

Krazny/KQED on Outsourcing

Michael Krazny hosted a talk show on KQED on October 23, 2003 about offshoring featuring David Lazarus, the SF Chronicle reporter who wrote about the woman in Pakistan who did work outsourced by UCSF, then threatened to post private medical information on the Internet if she didn't get paid. The program also included a CBS reporter, a SF Chamber of Commerce member, and an executive from an outsourcing firm.

Did you know that NYC parking tickets are scanned and then the digitized information is sent for processing in Ghana?

KQED FM radio: Bay Area at 88.5FM, Sacramento KQEI at 89.3FM, and 88.3FM in
Santa Rosa and 88.1FM in Martinez.

You can isten online (at any time). See
http://www.kqed.org/help/radio/radio-faq.jsp#ListeningOnline1

State and Local IT Outsourcing to Reach $23 Billion by 08

o Report: State and Local IT Outsourcing to Reach $23
Billion by '08

Reston, Va. -- Continuing fiscal pressure and the aging
government
workforce will help drive state and local information
technology
outsourcing from approximately $10 billion this year to over
$23 billion
by 2008, according to a new report released from INPUT, a
provider of
market intelligence to companies doing business with
government. "The
growth will become dramatic as retirements outpace the
ability of
governments to staff important technical functional areas,"
said James
Krouse, the manager of state and local market analysis at
INPUT. The
largest outsourcing needs are expected to come in the areas
of Medicaid
and welfare management.
http://makeashorterlink.com/?G1F721056

No US jobs, no purchasing power...

A BizTech member writes:

...Here's an interesting article in the 10-20 issue of US News
& World Report that suggests our so-called increase in US
productivity is because of outsourcing....
http://www.usnews.com/usnews/issue/031020/opinion/20money.htm

Pakistani transcriber threatens UCSF

LAZARUS AT LARGE
A tough lesson on medical privacy
Pakistani transcriber threatens UCSF over back pay

David Lazarus Wednesday, October 22, 2003

--------------------------------------------------------------------------------

"Your patient records are out in the open... so you better track that person and make him pay my dues."

A woman in Pakistan doing cut-rate clerical work for UCSF Medical Center threatened to post patients' confidential files on the Internet unless she was paid more money.To show she was serious, the woman sent UCSF an e-mail earlier this month with actual patients' records attached....

For full story, go to: www.sfgate.com