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Thursday, April 09, 2009

Outsourcing's Agenda

I've blogged before (and so have others) about the concept of outsourcing. It's been said that Ross Perot invented the outsourcing industry with his company - Electronic Data Systems. In the past few decades it has grown to an industry. And outsourcing now encompasses much more than just running mainframe computers or computer networks. In fact, just about anything can be outsourced these days.

Perhaps the question most of us blog about is whether or not just about anything should be outsourced. What are the political issues? What are the moral issues? What are the business issues? Do we have the right issues in each category? There are many questions. At the same time, there are many experts who will sell you their advice to help you sort out the issues.

Oddly enough, I'm a fan of outsourcing. But I see it as a double-edged sword. It seems to cross boundaries (as most things in life do) and become problematic. What's good becomes bad. How do we know this? Well, the surest signs are when ordinary events (transactions) seem to have extraordinary significance. In other words, seemingly ordinary decisions seem to get made with decision criteria that is may not so ordinary, maybe no so expected. Perhaps it might be a seemingly ordinary decision that gets made --- with rather unfortunate views.

Two such decisions came about this week. First, we saw that Xerox announced it will spend about $100 million paying an Indian company to manage its data centers. ( Xerox laid off more than 3,000 people last year, slashing American jobs. Now they're busy securing jobs in India ... while Americans suffer the most devastating economy in our generation. What made this incredibly newsworthy was Xerox' timing. It couldn't have been worse!

Second, we say that Sallie Mae (a company that the U.S. federal government created and then spun off) is pulling back jobs from overseas. ( Sallie Mae's operating company will create about 2,000 American jobs by pulling jobs from Mexico, Philippines and India. What made this story so newsworthy was Sallie Mae's alleged motive. It is said that Sallie Mae is trying to find favor with the U.S. federal government (its foreign parent) as it seeks to buy troubled assets at deep discounts (funded by American taxpayers).

Do you have that bad taste in your mouth? Offshore outsourcing has always tasted this way. It's always slashed American jobs to fund American greed. Stay tuned for more as the truth about offshore outsourcing continues to be revealed. Company after American company has drunk the Kool Aid on this one, folks. The best names in the business, from all the blue chip companies to the mid sized manufacturers --- have been busy shipping jobs overseas so they won't have to pay anyone in America a living wage. Now that our economy is crashing and burning and no American jobs are to be found --- we shall find out the real impact.

Can the American economy really recover when the jobs are all offshore? What do you think? And what of these companies -- most of which are falling on their swords -- that outsourced to offshore locations "in order to remain competitive?" What do you think? Do you suppose they really are more competitive?

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