Outsourcing: A Concern for Comp. Sci?

[ali_dada]

Hi,

This never seemed to bother me before (even though I knew about it) but now that I am in my final year of BSc computer science it kinda worries me. Allow me to elaborate a little: now that I am applying for graduate jobs or entry level positions, I can see on the companies websites that a huge chunk (if not the majority) of IT/Comp. Sci. jobs are either in Malaysia, China, or India.

Now, I know that this trend is more evident with larger companies while small and medium sized companies stick with the local talent. However, one must keep in their minds that this outsourcing just started 7-8 years ago and I am sure it will be more felt 10-15 years later when better infrastructure and technologies will allow other companies to start outsourcing. This will also cause big companies to outsource even a bigger percentage of jobs to 3rd World.

I mean, face it, nowadays quality IT/Comp. Sci. education is available in many 3rd World countries and they offer a huge incentive as well - why pay a Canadian comp. sci./IT worker $5000 or $6000 per month while you can hire 2-3 people in his/her spot for the same amount who are equally qualified? Also, due to the slump in the economy in the general, don't you think outsourcing will become even faster?

This outsourcing seems to be a big thing especially with the high end jobs in the field - software engineers and the networking professionals. Fine, there will be jobs in Canada but due to limited number of opportunities, don't you think it will lead to too much competition and lower pay/benefits? Also lower security making it a contract job market mainly?

I don't know man, it just kinda disappoints me a little - I mean I am studying my ass off and paying huge tuition/living costs and for what? An unsure future? To be honest, all of a sudden finishing this degree and getting another undergraduate degree in power engineering (3 yrs) or something (2-3 yrs) which requires workers to be in Canada looks very appealing - atleast they can't outsource those jobs! I was hoping to get a Masters in Comp. Sci. (2 yrs) but I don't think it would be my top priority now given this issue and the economic uncertanity.


What are your opinions? Do you think I am over-stating the danger?

[delparnel]

I think that a lot of the programmers for hire in those countries do a sloppy job, and follow a "make it work" principle. I have hired programmers from all around the world, and have seen some very shoddy work. I'm not saying they all are, but in my experience I haven't received exemplary code.

A lot of larger companies still prefer to hire locally. That way they can keep their programmers in-house, and readily available at their offices. Some others are hiring more and more contractors overseas, but I don't think this is a huge issue.

I think there will continue to be huge opportunities in the field.

-dkl

[Vertico]

Not really on topic, but China and India are not 3rd world countries. You probably didn't mean it to sound like that, just thought I would clear up the misconception.

[btiffin]

Another side note and old guy ramble;

North American governments are opposed to off shore outsourcing. Anyone that wants a federal contract is unlikely to have any large portion outsourced. Not because George or Steven or Felipe care so much about the employment, it is a "security" issue. Hitec City in India is mainly a call centre now, afaik. It was intended for large high-end development, but that got sidetracked when large companies were told by officials to not go there if they wanted federal commissions.

On sloppy work. As far as I know, that is more often due to misscommunications than malice or lack of talent or intellect. It is hard enough reading a spec and coding it right when the person that wrote the spec is in the next cubicle, let alone across the street or across the ocean and many cultures and time zones.

This is one of the reasons I hang out here on compsci.ca. To cheerlead talented individuals to become global leaders, from right here in Canada. Don't fear getting cubicle work. Make your own cubicle work and aim for the penthouse office. Be a boss. A world leader in computational enterprise. Hire all your classmates. Rah rah biss boom bah. Go entrepreneurs go!

There is nothing stopping a Class of 2008'er from becoming the CEO, CTO and Founder of the next big thing. Nothing.

Cheers

[Tony]

ali_dada @ Sat Nov 01, 2008 3:59 pm wrote:

you can hire 2-3 people in his/her spot for the same amount who are equally qualified?

If they are equally qualified, why shouldn't they be hired?

ali_dada @ Sat Nov 01, 2008 3:59 pm wrote:

I am studying my ass off and paying huge tuition

How do you think those other "equally qualified" students got to the same level of skill?

Point is -- it's a global market. There might be some moral incentive to give preference to local candidates, but it's not one of the "protected categories" that public companies cannot discriminate against. Low skill IT (call centers, tech support, fill-in-the-blanks development) are typically outsourced.

Now, if someone 12 timezones away can overcome educational, language, cultural, and tele-commute barriers, to do the job as good as you can -- it sounds like that person is working much harder to get the same job that you want. Still, communication with the rest of the dev team remains a vital advantage for the local developers. If your skills are up to par, you are still in the advantage, at least for a while longer.

[Roman]

I don't think it's a problem. Higher level of competitions do force you to work harder and better. They do require you to be passionate about your subject and live and breathe the material you are interested in (programming, in this case). But Tony is right, it IS a global market. And there is nothing "wrong" or "immoral" about outsourcing jobs that can be outsourced. It just means that we of the "1st" world will have to WORK to make that $6000 a month, as opposed to EXPECTING it to simply fall into our pockets for 40 hours of time every week.

btiffin has an excellent point. The upside of competition is that it forces you to overcome your laziness and reach higher and higher levels. Develop yourself and be the next ("awesome programmer here"), and India or not, you'll have multiple job offers and security to the teeth. I think that it's wrong to consider switching to something you don't like because you feel it'll be less competitive. Competition is everywhere nowadays =]

Plus, if all else fails, you can always study in India and avoid paying your high tuition fees/living costs

-RZ

[Dan]

I think a big problem with out scouring is that it lowers the average saliary/wage of programmers world wide.

I do adgree that programmers in other countries who are equally qualified are just as intitiled to programming jobs as us however i also think they should also be payed just as well.

The problem with the idea that you just need to work harder and get more skills is that companys are not going to be hiring overly qaluified candiantes and have to pay them more when they can hire less qaluifed outscored canidantes that can get the job done for alot less.

Also it is prity clear that alot of companys are willing to acept a lower level of qaulity for alot of savings. Just take call centeres for example. If compays caluaclte that outsocring to lower skilled/qualifed empolyies will saving more money then the number of custerms they lose, they are going to do it at the cost to consumer.

We should not be angry/woried about/at the outscored programmers but at the countries and companys that are devaluing all programming work.

As for Canada, i think we should put insentives in place to keep jobs of any kind in Canada be it threw tax breaks or even laws regulating the % of outsocred empolies a company can have. However my views are rather socalist and anti-freemarket so i guse the more consertive stand point would be to just let the free mark work it's self out and that maybe programers do dserve less money.

[delparnel]

btiffin @ Sat Nov 01, 2008 5:29 pm wrote:

Another side note and old guy ramble;
On sloppy work. As far as I know, that is more often due to misscommunications than malice or lack of talent or intellect. It is hard enough reading a spec and coding it right when the person that wrote the spec is in the next cubicle, let alone across the street or across the ocean and many cultures and time zones.

This is true. However, in my experience it hasn't been that the work is not within spec, it's that the quality of the code can be much less. Security has been a major issue, for example.

This outsourcing issue isn't just true for the IT industry. It's a major issue in North America across all industries, and will continue to be. However, I think the IT industry has more opportunity for us to make our own path.

[nike52]

Wouldn't you get tired of constantly competing? Even though compscis my passion, I know when I compsci too much I get sick of it. When I get a job, I want to go home and relax, buy and play the latest games or something, not constantly learn compsci if that's what competing entails, not to mention job security and salary.

[ali_dada]

Thanks for the replies, some of your posts were really encouraging - thanks especially to darparnel!

Well, I have an excellent GPA and for a graduating student, I have some solid IT work experience in terms of programming for a graduating student therefore I feel I should be fine.

I just hope that this economic times provides me with an opportunity.

Nike52, man don't worry...you won't be studying all over again. Majority of these certifications and trainings are fairly straight forward and designed for just about anyone. You learn all the stuff at Work as when you go home, you still get to play your XBOX or Wii!!!


Regards and thanks to all,
Ali.

P.S. I never said that there was anything wrong regarding outsourcing. Please don't think that way. Competition is healthy but like any Canadian citizen, I do hope to get a job in Canada based on my education and to start working soon after I graduate (just like any of you).

[Zeroth]

Well, it is a global market. However, so long as PHBs prefer their staff close and local to tor^w^w^winspire, then there will be only minimal outsourcing. Mostly its the lowest rungs of IT work, as someone else stated, that gets outsourced. So don't target those.

Yes, programmers will need to earn their paycheques, in comparison to the "cheaper" employees overseas. However, this does not mean you are getting a raw deal. Learn to do something the outsource employees can never do well: communicate. Learn to sell yourself, by going into a retail job for a year or so. Learn to sell your ideas. Don't just be a code-monkey. Be a Silverback Gorilla of Code(Just as a note, that name is reserved for me, as it was bestowed by my friend and partner. Hah!)

I have a question for all of you then: instead of looking to be hired, why aren't any of you thinking of doing your own startup, or a friend's startup?

[jbking]

My own take on this is that there is a coming wave where outsourcing didn't quite pay off as thought and/or companies realize that they may want to keep the domain knowledge within the company. If you stop and think about the level of customization in some applications and how a company can optimally structure their systems to use the same look and feel as well as provide power to the business in a sense, e.g. business intelligence and data warehouse kind of thing, there is something to be said for having the in-house expert as opposed to having to potentially re-invent the wheel if there are constantly new people being assigned to work on these tasks.

The specialization of software engineering doesn't seem to get the headlines though I think it should and if you want a good book about the outsourcing / offshoring, which are different things I would note, "The World is Flat" by Thomas Friedman has some excellent examples if you look at companies like Wal-mart or UPS that I doubt would outsource their IT that much as this is part of what made them so great. Agile development and a few other ideas still getting refined are suggesting, at least to me, that there will be cases where the developer who is taking a project from idea through to maintenance has to talk to the end user and get the idea of what they want, make the prototype and then spend hours tweaking it until it is great. This isn't likely to be done by developers out in other countries from the company's offices in some cases I'd think. What will start happening is that some developers will specialize in a type of application and this knowledge is what may make them useful and not likely to get outsourced as there may not be that many available with training on some of these things, e.g. SAP and Oracle come to mind though I think there may be others in the CRM/ERP/CMS/SCM/HRMS systems out there.

ERP = Enterprise resource planning = inventory management among other things, quite similar to SCM = Supply Chain Management
CRM = Customer Relationship Management = sales/marketing/support coming together
CMS = Content Management System
HRMS = Human Resource Management System

In the decade that I have been doing web development there have been many changes over that time where in some cases I have had to deal with outsourcing. To break things down a bit:

1) Dot-coms. In this case, some of the behind the scenes work can be given to those in another country and I did have this happen a couple of times. Once was where the founder had a deal with some Russians and so some of the software development was done there but there also had to be some engineers local to see that everything worked fine. It is an interesting story involving a printing press, being repaid in sheet music pages rather than dollars, and an interesting weight loss system where each Canadian sent over there lost a lot of weight getting used to Siberian food. In the other case, while working from the Seattle area, there was a group of developers up in Vancouver that we had to work with to transfer an order-processing system that had to get integrated as the company had a recent acquisition to digest and required a fair number of developers spending months on getting that done.

2) Application Service Provider. In this case the work is a combination of wireless communications and GIS to show where an asset is or has been. Quite an interesting field that is still developing in some ways though the company used other companies to be the main front-end selling the service along with another company to provide the devices. There were quite a few different uses I saw ranging from cargo security, to monitoring expensive equipment that may get stolen, to just recording what a truck did all day in terms of its operations(where did it go, how fast was it driven, how long did it stop at various places). Since this requires use of the wireless telecommunications, that part isn't likely to get outsourced since a large part of this is the device reporting where the asset is. Oddly enough, the company did outsource its internal IT functions like setting up machines, monitoring servers, etc. to a local provider of these services so that it wasn't a dedicated person drawing a salary which was the former situation. So there were various people in the outsourcing company with varying skill levels that made it more cost-effective for the company to do this and it made sense since most of the people in the company were technical enough to fix their own machines, why have someone who would just be "babysitting" them in a sense.

3) Technology solutions provider. Now where I work there is definitely some development that will be done outside the company but we want to have enough cross-training so that an in-house team can handle small changes that may come down the line. The consulting companies need to have some staff in North America to keep that face being local as it isn't every company that wants to deal with someone that feels so far away. There will likely be an internal IT group for the foreseeable future from my view as we are the backbone of the company in a sense.

There are also various oil and gas companies around here in Calgary that hire a lot of developers to do build various technical applications where this expertise in the business of oil and gas isn't likely to be found in India or China. Texas, maybe though once again this may not be a cheap place to hire developers.

[ali_dada]

FYI...it is wrong to think only low-level IT jobs are outsourced.

If anybody goes on job listings on big technology company's webiste, you can see that jobs like those of computer engineers and software engineers are also outsourced to various places around the World.

Just last week I had an interview with a company and they mentioned that they were outsourcing their application development work to India.

Finally, I know of a bank in Canada which brings IT workers from India on work permit. The bank saves money on such hires as those on work permits don't get all the benefits that a Canadian employee or an employee on permanent residence gets.

But hey man, I guess we should learn to accept the reality and be prepared to compete with it. We should sharpen our skills and our work ethics but at the end of the day, if outsourcing is to take our over jobs, we can always move on to find other jobs...big deal.

I am happy I am in this field as it interests me and since I have acheived my academic excellence due to the fact I am in computer science - if anything, I owe a huge thanks to the IT industry.

[jeffgreco13]

Sault Ste Marie has a population of around 75,000 people and its safe to say that our city was built around a Paper Mill and a Steel Mill which, combined, employed the majority of the city. So when the steel mill's (Algoma Steel) production hit an all time low they were forced to sell to Essar Steel, which is owned by a man of Indian decent.

Wouldn't you know that he outsources the ENTIRE industry's IT dept. to India. Yes that's right, all of the company's Canadian employees must now call an automated IT service center in India to get problems fixed. If they can't fix your software issue and it is deemed a hardware issue some low level, colour coordinating, slob of an IT rep comes in to switch out your old PC.

Tell me that's a SMALL outsourcing case.

[btiffin]

ali_dada @ Mon Nov 03, 2008 10:16 pm wrote:

FYI...it is wrong to think only low-level IT jobs are outsourced. ...

True; but I'd still prefer Canadians run their own show. Start a company that is cost-effective enough to get Russian contracts, Indian contracts, Chinese deals, etc.

And it seems, that people like delparnel are doing their part. We should all aim to be in that position. Keep up the hiring of programmers delparnel, well done.

Old guy rant follows
And don't shop at WalMart. People my age gutted the field for young people. By going to the bigbox stores and saving $25 dollars on a bigscreen TV, we have pretty much guaranteed that there will be no work here. Blame your parents. Unless they happen to be the rare people with enough common sense to know that the WalMart phenomenon is just bad for everybody while looking like it is good for the individual. I had a real good argument with an older friend of my mom's. She could not get over personal greed and "self survival" to see how bad an idea it is. Everyone believes that if you spend $25 dollars more going to a small store on main street that they will fall behind the Jones'es. And while it may be true, it also guarantees that Mr and Mrs Jones won't have work either, eventually. Eventually seems to be now.

Sadly, with the new crisis, WalMart will profit more and we'll spiral further down the toilet. And we may well deserve it. So rail against the machine, hire people that may not be as cost effective as the "other guy" and we may stand a chance in the future. But humans being humans, I bet we won't. So it may be best to just go with the flow and live the "me me me" lifestyle.

Cheers