Wednesday, November 22, 2006

Offshoring - The Real Reason



Lots of politics on my mind today.. I don't average a single political posting each month, but here is my second one for the day.



Without disclosing where I work for, let me just say that I've seen a lot of offshoring, and see more of it every day. I've stood in hallways and watched mgmt take teams of people from India through the offices and let them pick out sections they want to take over.



We (as a society) have been doing this long enough to know that there's really no profit in it:

  • There is still a need for people here as processes, procedures, mgmt of the offshore teams, etc. must be done.
  • Facility build-out and connectivity must be paid for by the client.. that's us back in the U.S.
  • There is frequently a need to hire stateside consultants to fix the errors of the offshore teams.
There are dozens of other reasons that I could list, but let me get to the point and solve a great mystery:



If we are only saving 1-10% and causing a great impact on our own society that results in lost profits (americans with no jobs = consumers not buying your products) that more than eat up that 1-10% offshore profit.... Why, why are we doing this?



The answer, my friends, is accountability. If I may generalize for a moment...It should come as no surprise that the guys upstairs, those that are truly wealthy - executives of companies medium and large, really don't care about anything but themselves.



It wasn't until post-Enron when the government starting holding executives accountable and putting them in prison. Do you think it's any coincidence that about that time is when offshoring became the norm? I don't.



It's all about finger pointing. Having the power to destroy 1000's of people's lives so you can have a shiny new yacht, exotic supercar and sexy supermodel... all the while placing blame on the other guy... that's what it's all about, always has been, always will be. The other guy being outside of U.S. jurisdiction just makes it all the more appealing.



In the end, who pays for this? Well, us, the common people, of course. In lost jobs, lost opportunities, losing all that goes with that well paying job. Society (as a whole) pays dearly when society (as individuals) slowly descends into poverty. Of course, the white collar criminals will continue to go free.



It seems damn near everything these days is made in China or Japan, and all of these services (even surgery, yikes!) is going to India. All of this to save money, but where are the savings? You'd think with companies saving *SO* much money, at some point, they might pass on a penny or two of that savings to the customer.



Offshoring has been big for about 5 years now. Let's say it takes 2 years to work out processes and for the savings to trickle down... 3 years, right?



Think about every bill you pay, every product you buy. Raise your hand and say "Yea" if you've seen prices go down or remain the same on even one bill for the past3 years.











It sure is quiet in here.





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