Outsourcing is no more the same

With the US economy receding, there is an increased focus within firms to on cutting all kinds of spending. And outsourcing is no more the same as it used to be few months back.

The shares of Indian IT companies have plummeted as a result of this economic slowdown (partly due to appreciating rupee too). However, while IT spending is going to be cut to some extent by some companies, there will be others who would be looking to outsource more in an effort to cut costs. So, this will kind of balance out or maybe tilted a bit towards outsourcing. But note that here we have not considered those firms who have not been outsourcing. These are the 'rich' companies who have been against outsourcing. But now they will discover that outsourcing can be their savior in difficult times. Hence, they will be forced to outsource work to countries like India.

What does this mean for Indian IT companies?
1) Risk is spread better because number of clients will increase thereby reducing the dependence on a few clients.
2) Overall demand for outsourcing will increase, thereby propelling the growth of these companies further

Name to face and face to name

Outsourcing has been the key driver of IT industry in India and several such IT service providing countries. This has led to use of global delivery models wherein the business teams don't know the development teams. This means people are simply names (and seldom do we put faces to names). Similarly, sometimes the teams working for a particular client might not know each other well enough i.e. no names to places.

I think that overall comfort level of all the parties involved would somewhat increase if we were to put names to faces and faces to names. So, ensure:

1) Sharing of photos/ videos between onsite and offshore folks

2) Parties to be organized at account level so that people get to mingle (this finally helps in team bonding and knowledge sharing)

Now outsourcing can't cause unemployment in US

Yes. Now there is enough space for everyone in the IT industry. We often talk about outsourcing being the cause of unemployment in the US and other developed countries. This was probably true till last year or maybe even this year; however, this has changed very fast now. Here is what has caused this:

1. Growth rate of IT industry in India
With the growth rate of Indian IT industry not relenting, and the rate of creation of talent not matching it, it is obvious that there is going to be dearth of talent in Indian IT industry. Moreover, the India has not yet become a consumer of IT services in a big way. So, the growth rate is expected to be robust (same if not better) over the years to come. So, this gap between talent demand and supply is going to widen further and there will be no other choice for Indian IT companies except for hiring from US and other countries. Recently, TCS opened a 1000 people center in Ohio, US.


2. Overall economic growth of India
India is fast moving from its status of a 'developing country' to a 'developed country'. So, there is demand for talent and skill (at all levels) in all industry segments in India. Since the demand is coming from all sectors, and the pay scales rising fast in non-IT segments too, there is further dearth of talent in India.

Do you think Indian IT industry will be able to contribute to unemployment in US anymore?

Shortage of people in over-populated India?

I would say 'IT' in India is a job spinner. I remember my days 14 years back when i was really slogging to get admission into one of the major engineering institutions (the IITs) . That was real hard work -- 16 hours put in every day continuously. The carrot was -- if i get into an IIT i will get a job for sure and if i don't i might have to really struggle. IIT entrance exam was a tough one where we had around 0.2 million students competing for around 2000 odd seats.

That was then.

Now, with the IT industry roping in engineering graduates from across India (and the world), the jobs are aplenty. Almost, all engineering colleges across India have campus selections in the IT industry. So, it easy guys. No more 'burning the midnight lamp'. Just chill. And note that the campus selections are rising by the day and students are booked when they have just completed 50% of their course i.e. 2 years of their study. Which also means 2 years in advance. In my days, even in the IITs, campus placements were not always 100%. But now all engineering colleges have excellent campus placements. Leave engineering grads, all grads are having a great time -- thanks to ITeS (IT enabled services) i.e. call centers and BPOs.

So, IT is a real job spinner. And, in fact, it looks quite strange that we are soon going to reach a stage wherein we will say that there is dearth of people (IT-able people) in the 2nd most populated country of the world (or has it become the most populated now)?

Let me introduce this blog and me

Friends,
I am MGoel, an IT pro who is fast approaching 10 years of age in Information technology industry. An engineering grad from India's premier institution (IIT) , I have worked across the globe on various IT assignments of various size and nature. I will not take this intro further since i see the risk of being interpreted as a self-seller.
So this idea of starting my blog came to my yesterday. And this is my first blog --- and even the first experience in the blogging world. So, i will discuss almost everything about IT on this blog.

Anything else that i need to write about on this intro???

So, welcome to my blog.

As i signoff, i am just thinking what my first post would be --- and i have decided that i will not think about the topics but will write about whatever comes to my head. And if you, my friends, want to discuss about something -- i will write about that.

That's how you will see IT thru the eyes of a globetrotting IT pro.

Thanks
MG