Does “Business Savvy” Help You in a World of Offshore Outsourcing?

Business leaders and IT experts are disputing an emerging trend in the UK that freelance technologists must be “business savvy” in order to remain competitive on the contract and offshore outsourcing market.

I’d have to say, it can’t hurt, since that was a good resume item before offshore outsourcing was stylish.

Read the entire article at www.contractoruk.com.

IT department headed for extinction?

Or is it just evolving?

As business conditions change, IT departments must adapt to maintain their status within the company, says Danny Bradbury. The alternative is irrelevance – and extinction.

Read the entire article by Danny Bradbury (deal link deleted).

Not Enough IT Workers in the USA?

Surprising paragraph from a recent news story:

For those who have been living through the leanest times on record in the IT industry, it must have come as a shock to learn that, by 2012, the U.S. economy will create 21 million new IT jobs for which only 17 million new IT workers will be produced.

Read the entire article here: Global IT Workforce [Sorry, no more link, article was removed from their website].

Good news for us in the American IT sector.

Critical Offshore Outsourcing Skillset for US IT Professionals’ Survival

Here is an article that shows offshore outsourcing is here to stay. Many interesting insites on China and India, however this part about how Wipro’s capability to manage teams that span the globe was most interesting.

This is the kind of offshore outsourcing skills IT professionals need to develop to safeguard, or even enhance their careers.

Take outsourcing firms like Wipro and Infosys, which both count dozens of U.S. tech companies among their customers. Initially, the firms won contracts strictly because the country’s pool of low-priced software engineers offered tremendous savings for companies that needed new software.

But now they are offering more-sophisticated — and profitable — services and moving up the technology value chain.

“This is no longer about renting people and buildings,” said Vivek Paul, chief executive of Wipro Technologies and vice-chair of parent company Wipro Ltd.

The company’s deep pool of engineering talent and experience on managing collaborative teams located on opposite sides of the globe has helped it pioneer an extremely efficient way to design, code and test software.

You can read the entire article on Investors.com [link removed, article no longer available].

Tech Pay Increases For IT Workers With Key Skills

Found an interesting article on salaries for US information technology people [Link removed, full story no longer available]:

“Pay for IT professionals with key skills is on the rebound after several years of decline, according to a new study released Thursday by research firm Foote Partners.

“The study, which examined IT salary data for about 45,000 IT workers from nearly 2,000 North American and European employers, showed that talent-retention fears, offshore outsourcing disappointments, and aggressive hiring by consulting firms is pushing up pay for several skills areas, including application development, networking, groupware, and messaging.”

Outsourcing is an Opportunity for IT Professionals

Interesting article from The Register:

The British Computer Society says offshoring is now a fact of life but represents an opportunity for UK IT professionals as well as a threat…
BCS chief executive David Clarke said: “The challenge for British professionals now is to gear up for the rapid globalisation of the IT services industry that is well underway. Traditional IT skills such as software development have become globally ubiquitous and a narrow focus on technical skills and their application will not help tomorrow’s professionals. But all too often, IT staff can underestimate their business knowledge and expertise too.”

You can read the entire article here: BCS says skills beat outsourcing.

Outsourcing Allows Companies to Focus on Critical Business Drivers

Another interesting article on outsourcing [Link removed, full story no longer available] from an ad agency in the UK.

They referenced CMM as an indication of offshore software quality in India, so it hit my radar screen. The article is about ad agency outsourcing, but this nugget of gold is in the middle of the article:

…outsourcing frees your agency to focus on core strategy, sales and marketing. Ideas, innovative products and services, knowledge of your customers needs: these are the real drivers of growth, so ideally you want to be spending as much time as possible on them.

Change a couple of words and the above could easily apply to a company developing software products offshore. That’s another example of someone that “gets it” on the topic of outsourcing.

Internet Entrepreneurs: The Ultimate Example of Leveling the Playing Field

The last point on my previous post was that offshore software development can level the playing field for smaller companies competing with larger companies. I got some feedback that this is truer than I thought.

Internet entrepreneurs are the ultimate example: a one person company can use offshore software development to build a web site that is as functional and looks as official as any major corporation’s site.

Offshore Outsourcing, Why You Need to Make it a Core Competency

This site is all about learning to succeed with offshore software development. You need to make learning to work with an offshore outsource development team one of your core competencies. Here are the top reasons why:

  • In today’s cost constrained environment, the primary way many companies are adding more human resources to software development is via offshore outsourcing. If you know how to work well with an offshore software development team, you will have access to more resources than others.
  • When the competitive landscape changes, failure to adapt is not good for your survival. Offshore outsourcing is a huge change that companies are not able to ignore, so neither can you.
  • There are many useful software projects that never get done for lack of resources. Some companies are getting these done via offshore outsourcing.
  • When work can be done at a lower price, it will be done that way, even when risk is involved. For example, are the guys that cut the grass in your neighborhood legal US residents? Are you sure?
  • If someone else can do what you’re doing cheaper, that’s a wake up call for you to go find higher value work. Software development is on a track to become a commodity skill set. Think about China, which graduates over three times as many engineersas the USA every year. What’s going to happen in a few more years?
  • You need to be on the right side of major industry trends like offshore outsourcing. Fighting against a strong trend with economic benefit behind it is futile.
  • If you don’t embrace offshore outsourcing, someone else will. It may be someone in your company, or someone at a competitor. The ultimate results are not good for you either way.
  • Offshore outsourcing levels the playing field for small companies that could not afford development of large, specialized software applications at US labor rates. This seems like a big opportunity.

American Software Professionals Can Prosper With Offshore Outsourcing

Worried About Losing Your Job To Offshore Outsourcing?
Want To Insure Your Success No Matter How Much Work Your Company Outsources??
Then Keep Reading…
If you’re like many American software professionals, you’re concerned about loosing your job due to offshore outsourcing of software development and IT services.

More and more companies are looking at offshore outsourcing as a way to cut costs or expand their software development capabilities. Job loss is becoming a concern for more of us every day.

There are ways to insure your personal success, even if offshore outsourcing is used on many projects at your company. Actually, offshore outsourcing presents an opportunity.

Taking advantage of that opportunity is what this article (and this website) is all about.
But first, a quick story:

A young American programmer graduated from college a few years ago with a degree in Computer Science. He could not believe how great life was; getting paid for doing work he really enjoyed.
Everyone told him what a bright future he had, since “you know how to work with computers.” The internet was experiencing explosive growth, everyone was getting online and there was a severe shortage of software talent.After a few really awesome years, things suddenly got tough. The dot com bubble burst, there was excess computer talent on the market, the economy tanked after 9/11 and the industry buzz was all about “offshore outsourcing.” For the first time, competition for software and IT jobs was coming from offshore companies in India. Cost savings of offshore outsourcing was enticing lots of companies to take the plunge.

Our young programmer friend was asked by his manager to bring a software team from India up to speed on some of his company’s software projects. After a deep breath and gulp from the lump in his throat, he thought this wasn’t supposed to happen to me!

Have you found yourself in a similar position? How did you respond? How should you respond to offshore outsourcing?

Your response to the growing trend of offshore software development will make or break your career.

Some responses to offshore outsourcing that I’ve seen are listed below. They are ordered from least productive to most productive, IMHO. If you have another response not listed here, post a comment so we can discuss it.

Response 1: I’m going to work for a company that does not outsource software development to offshore companies.

This is a you-can-run-but-you-can’t-hide situation. With competition, more companies will be turning to offshore software development teams to lower their cost and improve their product or service.

Offshore outsourcing is a growing trend; over time you will be chasing fewer jobs and fewer companies that don’t use offshore resources.

Also, as this is written (fall 2004), it’s not the best time to be looking for a tech job.

Response 2: I’m going to sabotage this offshore software project so the jobs will come back to the US.

Oh yea, that’s going to do you a lot of good. Does the phrase “up to and including termination” ring a bell? If you’re into getting fired, go ahead, otherwise, you might want to read on for a better response.

Response 3: Sabotage won’t be necessary, I’m going to sit back and watch this outsourcing project fail all by itself.

Some companies do have challenges with offshore outsourcing, it is not a panacea.

Careful preparation and execution are required for success.
If you just wait for the project to fail, you end up missing an opportunity:

  • Imagine your position if the project succeeds because of your actions. This could be very good for your career.
  • Imagine your position if the offshore project succeeds without your help. Not the best place to be.

This response also leaves you at risk: your competition might make offshore software development projects work, putting your company at a competitive disadvantage, which is never good for the long term.

Response 4: I’m going to become a political activist and elect people that will outlaw offshore outsourcing.

Not really an option for those of us that truly believe in free markets. This is also a path to failure for the USA software and IT industry. Other countries will use offshore outsourcing to get a competitive advantage over us.

Response 5: I’m going to keep working the best I can and hope I don’t get replaced by an offshore developer.

OK, that’s better, but you should control your destiny or someone else will.

Response 6: I’m going to embrace offshore software development; there is an opportunity here somewhere!

Offshore outsourcing is here to stay. Why not proactively engage the mega changes that are just starting? This is what the future leaders of the software industry are doing; they are changing before they have to.

What does it mean to embrace offshore software development?

  • It means recognizing that the offshore developers are real people, just like you. They share many of the same desires you do for a family and a better life, both as individuals and as entire countries. You can’t buy into the lie that offshore developers are some sort of evil force out to steal your prosperity.
  • It means working to become part of the solution in your current position. Go figure out how can you identify the right projects for offshore development, or how to keep an offshore team in sync with changing business needs. Solve some real problems to make offshore outsourcing successful and you will increase your own value.
  • It means looking for new opportunities presented by offshore outsourcing. Maybe you can do that project that would have been so helpful, but could not be justified at US development cost. Maybe your company can compete at the next level up with additional resources from offshore. Maybe you can start that company you have been thinking about and build a new software product with offshore resources.

The goal of this site is to promote discussion and share experiences to help you succeed with offshore outsourcing of software development.

If you share this goal and accept the challenge, here are some concrete actions you can take right now:

  1. Fill out the Offshore Outsource Software Survey. This survey will combine the experience of many software professionals to give us a better view into what factors make offshore software development projects successful.
  2. Signup for update notifications on the Offshore Outsource Software Success home page, or add us to your RSS reader.
  3. Post a comment to share your experience, ask a question, or start a conversation.
  4. Become an expert on offshore software development by reading and learning. Use this site a reference and submit ideas for articles that you think would be helpful.
  5. You can even write an article for this site.

I hope you make the decision to embrace offshore software development.