the myth of American supremacy 4471

Only time will tell...

Again, this is not a value judgment of "Indian" versus "American", but rather the quality of work. Let's not confuse the people with the work. Bill Gates and Larry Ellison have invested heavily in Indian development, and their shareholders would raise quite a fuss if suddenly they were to say "oops, we made a mistake..." Regardless of what they think, they cannot go back to their shareholders and say they've been leading their corporations down the wrong road for the past decade.

Why not? There is published data on the quality of work using various methods of Project Management and Software Development methodologies. There are comparative studies detailing the relative quality of code written in various programming languages, during various periods of time, etc. Any CMM level 4 or CMM level 5 certified company should be keeping meticulously detailed quanbreastative and qualitative measurements of their processes and their code. After all, that's what differentiates CMM 4 and 5 from CMM 3.

And now we get to the heart of the matter. I've worked with Wipro, and fixed thousands of lines of their code after the fact. The company I worked for did a qualitative and quanbreastative analysis comparing the code delivered to us and the code we generated. After all, that's what you do at CMM 5. It was discovered that the company's overall savings, once all factors had been included - including the man-hours spent fixing the code after the fact - was just under 10% net; for small projects (i.e., website design and graphics editing), the savings was closer to 30%. That was nowhere near the 50% savings the Board of Directors and shareholders had been promised; and although they continued to outsource projects, they scaled back considerably and ended up hiring additional in-house programmers. The Board decided the savings were not worth the additional incurred risk or the added complications for large or complex projects.

Businesses are completely enamored by "cheap cost", and when it is demonstrated quanbreastatively and qualitatively that they are not experiencing the savings expected, it loses its luster. After all, there are a lot of potential 'unknowns' and risks that a company faces while outsourcing. What happens if India and Pakistan go into armed conflict tomorrow? What happens to all those projects that were being worked on for foreign companies? What if there is a natural or other disaster of some sort? It's a simple risk analysis, and at 50% savings the benefit might outweigh the risks; but what about at 30%? 20%? 10%? How about at dead-even 0%? Is it worth the potential risks at that point?

Why would a company outsource further to a foreign company despite unhappiness with products and services? That's a simple one. Many have not done analyses of projected vs actual cost savings; therefore they do not know how much they are actually saving. Some have not done a risk analysis and do not know if the risk is acceptable. Some have accounting reasons for pouring money into dead, dying, or other projects which "make them unhappy." One good write-off can save you significantly more money than all the programmers in Southeast Asia.

So what is the major driving factor that is pushing outsourcing to India right now? Let's take price completely out of the equation for the moment. buttume that Indians are receiving equivalent pay for their services; that the tax rates for foreign companies are exactly the same as they are in the U.S.; that Indian businesses are subject to the same regulatory powers and costs. With that picture in mind, why should I, as an American business owner, hire an Indian programmer for $60,000 per year as opposed to an American programmer for $60,000 per year? What is the justification to ignore the costs of communicating with an Indian programmer overseas? For adjusting my schedule to match his schedule needs? For dealing with International law issues and the local regulations and laws in India? Can you give me just three simple reasons why I should hire the equivalent programmer in India when I have an American programmer who can work on-site for the same price in this scenario?