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This article actually discusses what I've been preaching here. We are
located in the middle of Indiana and it's a very affordable place to do
business.
I have a couple of thoughts on this whole subject anyway.
1.) Outsourcing in itself rarely equates to cost savings. Savings in
outsourcing labor should normally only occur when the outsourcing is
offshored to a country where the labor is cheaper. I realize this is the
thrust of the article but I'm amazed by how many people simply assume that
you can outsource and save money. It most likely will only happen when you
move it to a area with lower cost issues.
2.) At the risk of repeating the IBM chant - outsourcing an iSeries shop,
with it's already low cost of support, usually doesn't make financial
sense. We've repeatedly looked at it here and it's never been worth the
extra cost to do the function. While I'm sure it has happened and will
continue to happen the trend to outsource iSeries shop should always lag
the market. Heck one option to outsourcing your complex Unix or Windows
operation is to keep it yourself and put as much as you can on the iSeries.
In certain configurations (ie SAP or similar ERP with large databases) the
iSeries rocks with much less personnel.
3.) I tend to look at the outsourcing/offshoring trend as a phenomena that
is starting to rationalize itself. In the beginning - You can save 50%,
after a while - You might save 10% but the good shops can still save 50%,
after a while longer - who knows. But you are seeing a decent number of
offshore deals coming back to the US or even more interestingly moving to
another cheaper country. I'm not trying to sound like the ugly American
but the reality of the matter is that the total cost of ownership, issues
with language barriers, custom barriers, time zone differences, inability
to create proper service levels, inability to properly contract
arrangements, etc. is starting to become enough of an issue where the
lemming approach we saw earlier is starting to rationalize itself and
people are starting to think with true long term business benefits in mind.
4.) I work for a company that is part of a larger US and international
presence. The US presence is currently located in a place where no matter
what they do I can always do it for 10-30% less. They are in an expensive
place and I'm not. I don't think they've caught on yet and I'd suspect
they'd protect themselves before making any kind of move towards us. Our
international headquarters is also located in a more expensive place - and
surprisingly when they outsource they do it in the same country.....I can
guarantee you they aren't saving money by doing that.
5.) I am going to generalize but if a firm is looking at saving 10-30% by
offshoring/outsourcing I think that depending on where they are located
they could save that kind of money by moving it to somewhere in the
US......
Rich Duzenbury
<rduz-midrange@we
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> Midrange Systems Technical
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Subject
02/17/2006 12:27 Re: Rural Outsourcing
AM
Please respond to
Midrange Systems
Technical
Discussion
<midrange-l@midra
nge.com>
On Thu, 2006-02-16 at 20:57 -0500, Jim Franz wrote:
> (for me) it's still who you know.... I see jobs get filled by someone
> recommending someone else - not by job listings and web posting boards.
> To put it bluntly, that's a cr** shoot way to hire. The job listings go
up
> when contacts don't find the right person. I would agree
> the days of a 'warm body coder' are about gone. You need to really know
> some particular app or certain niche skill, especially for telecomute.
I've
> been
> telecomuting for over 7 years and contract/consulting for decades before
> that,
> and it has always been who & what you know.
> Many companies will not lead with telecommute, but if your the right
> person & skillset for the job, they may very well consider it (especially
if
> you ask for relocation expenses if not a telecommute).
> jim franz
I agree. I've been consulting since 1991, and haven't skipped a beat,
until recently. I've seen a number of customers decide to de-install
AS/400 and go another route. I've seen some large outsource deals.
But I haven't seen very much 'rural-outsourcers' as the OP suggests. I
suggest there would be more evidence of it -- especially on job boards
-- if it were more common.
> ----- Original Message -----
> From: "Rich Duzenbury" <rduz-midrange@xxxxxxxxxxxxxxxxxxx>
> To: "Midrange Systems Technical Discussion" <midrange-l@xxxxxxxxxxxx>
> Sent: Thursday, February 16, 2006 7:32 PM
> Subject: Re: Rural Outsourcing
>
>
> > On Thu, 2006-02-16 at 17:28 -0600, Shannon ODonnell wrote:
> >
> >> But she does make a great point. Why in the world would any company
want
> >> to
> >> send programming work to India when you can get quality, reasonably
> >> priced
> >> work done right here in the U.S. through the use of rural-outsourcers?
> >>
> > I don't know. I've lived in central Iowa for about ten years now. I
> > can work for my customers in California and other 'high rent' places
for
> > a decent wage, but with an Iowa expense level. However, I've noticed
> > that jobs are getting harder to come by, even so.
> >
> > If it's so great, than why is it rare? I ran a quick search on
dice.com
> > for 'RPG or ILE or AS/400 or AS400 or i5 or iSERIES'. 1043 results.
> > Check the 'telecommute only' box and watch that drop to fifteen.
> >
> > Regards,
> > Rich
> >
> >
> > --
> > This is the Midrange Systems Technical Discussion (MIDRANGE-L) mailing
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> >
>
>
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