Apr
28

The Future of Global Offshoring?

I would definitely like to hear from IT professionals across the pond on this one. When someone tells me that the major driver for Global Offshoring is the lack of talent in the UK and EU rather than cost reduction, I think I have to call BS! The major driver right now and in the past has been one simple thing, corporations taking advantage of the lower labor costs associated with developing countries. One of the things I hear frequently from pro offshore groups is that outsourcing/offshoring allows a company to free up its technical staff from having to do boring, repetitive tasks, thus improving their morale. Let me tell you what really happens when existing staff hears outsourcing or offshoring rumors, a cold chill runs down their spine because they know what that means! Yes, their jobs are at risk in a very real way.

Now let’s not be naive, offshoring is not going to be regulated away. The financial incentive is just too great for companies to resist. What happens if company A decides not to outsource, but their competitor Company B does outource. Well, lacking any unusual circumstances, Company B is now going to be able to offer their product or service at a lower price than Company A. Company A really only has a couple of choices at this point. They can either offshore their work in order to compete or come up with some sort of innovative solution onshore that keeps them in the game. So, lets stop using the euphemisms like Global Staffing in place of Offshoring, stop telling me that outsourcing/offshoring will help onshore morale (it won’t). We are all adults here, bottom line…. don’t piss on my leg and tell me it’s raining!

Apr
01

Merriam-Webster to remove the term “Outsourcing” for IT and Business Services – Horses for Sources

 

WTF! No more outsourcing?

Horses for Sources

04/01/12 – Pressure from buyers to create more accurate terminology for what we commonly, but incorrectly, term as “outsourcing” for IT and business processes has spurred dictionary publisher, Merriam-Webster, to remove the term from their next edition.

A big lulz to the guys over at HFS!

Mar
28

Another 750,00 IT Jobs to be lost to Offshoring by 2016

Offshoring Graph

A new study by the Hackett group indicates that even more jobs are at risk to offshoring than I have previously reported. Hackett is indicating that 750,00 more IT and Finance jobs will be lost to offshoring between now and 2016.

The good news? This offshoring trend will begin to decrease by 2014 and will actually hit zero jobs lost to offshoring by 2022. Why will this happen? Because corporations by that time will have run out of jobs that they can move offshore. Offshoring and Outsourcing aren’t the only reasons we are losing tech jobs here in the US. Automation and and productivity improvements will have accounted for the loss of 2.2 million IT jobs between 2006 and 2016.

The numbers above are based on a survey of 4700 companies with annual revenues that exceed 1 billion dollars. With this in mind these numbers are really understated since there are thousands of corporations that have revenues in the hundreds of millions.

The IT job landscape will continue to be fluid and hard to navigate due to technological change, Offshoring and Outsourcing, and Automation. Even when offshoring and outsourcing decrease by 2022, corporations are going to be under heavy pressure to cut costs in other ways. Expect to see a ramp up of automation projects and business process improvement projects that will continue to put pressure on well paying service jobs. This is why I believe IT’ers need to grab the bull by the horns and come up with alternate methods of generating income.

I have been recommending Internet Marketing for a number of reasons, first, the skillsets required in each are compatible, second, even though IM is subject to same issues noted above, you are in charge of your own destiny and are more flexible as an individual than if you worked for a corporation. In fact when it comes to automation, the independent IM’er will be a beneficiary. Same for offshoring, the successful IM’er can begin to offshore simple and repetitve tasks to low labor countries. It really comes down to this, do you want your financial fate in the hands of corporations that could care less about your financial well being, or in your own hands.

Internet Marketing Primer

Jan
15

My Thoughts on the Outsourcing and Offshoring of Tech Jobs

Mumbai Evening Skyline

The Outsourcing and Offshoring Dilemma – How to cope?

Some of you reading my articles may think that I am against offshoring and you would be wrong  - to an extent. Having read “The Lexus and the Olive Tree” and “The World is Flat”  by Thomas L. Friedman it didn’t really matter whether I personally agreed with the concept of offshoring or not, it was an economic juggernaut steamrolling its way towards me and many others, whether we liked it or not. At the macro level Offshoring is going to raise the quality of living in those countries that are on the receiving end of the jobs that are flowing out of the US, Europe, and Australia. Countries like India, Malaysia, and Kenya to name a few, will see a lot of benefits from these jobs. The standard line of proponents of Globalization is that over time global labor rates will level off and we will have a more balanced and efficient world economy. I agree with this, unfortunately, we as individuals live at the micro level of economics and for every job that moves overseas, there is a real person facing dire financial consequences because that job was moved.

So, what to do? I’m a capitalist at heart even though our current system leaves much to be desired, so I believe the solution lies in innovation rather than regulation. Besides, in our current political state, the chances of getting any kind of political solution would be nil anyway. The global marketplace has a way of punishing those countries that stray from the concept of the free flow of capital. So, again, what to do? Well, in the US we have been known as innovators, and I have no doubt that we can find a wealth of opportunities out there if we look at upcoming trends. Things like green energy, urban farming, and social media all offer jobs with growth potential. As a technologist I like to look at the root cause of a problem before trying to solve it. In this case I believe the root cause of the problem is an over dependence on Corporate America and single streams of income. Now, we can’t just cut our dependence on Corporate America because that is where the capital generation is, but we can stop this insane practice of working for one corporation at a time and being completely dependent on that corporation for our lively hood. We do this by building additional income streams.

In my case I decided to get into Internet Marketing for a number of reasons: high potential income, scalable, <irony> a lot of the work is suitable for outsourcing or offshoring</irony>, work from any location, and work when you want. There are many types of Internet Marketing, the area I am concentrating on is Affiliate Marketing. I will be writing more detailed articles on Internet Marketing in general and affiliate marketing in particular at a later date. For now, if you are interested in learning more click this link!

Jan
02

450,000 Tech Jobs will be Lost to Offshoring!

450,000 Tech Jobs gone by 2014!

Technical Conference in India

The Hackett Group recently released a report that says it all: 2.8 million tech jobs have been lost to offshoring sine 2000, and another 1 million will be lost by 2014! The report is based on responses from 3,800 companies based in Europe and North America that annual revenue of 1 billion dollars or more.

We have gone from 4.5 million IT jobs in 2000 to 2.4 million today, and the slide will continue through 2014 when the number will hit 2 million even. These job losses will include Data Center Operators, Application Programmers, Server Admins and DBA’s.

What is the Hackett Group’s advice to those with Tech Jobs in the US and Europe? It is time to come to terms with the fact that the world is going Global and those with IT Jobs will need to enhance their skillsets to compete. Unfortunately this applies only to those that still have jobs when 2014 rolls around.

The offshoring problem is bad enough but add the increasing use of automation and you are going to see tech jobs like Computer Operator, Production Scheduler, and System Admin be completely devastated by these trends. Each of these trends are going to create a demand for Managers that are capbable of managing offshore workers remotely and interfacing with business stakeholders domestically. The problem is for each of these new Management positions created, multiple tech jobs will be lost, resulting in a continued drain of IT jobs away from the U.S. and Europe.

The current crisis in IT Jobs is why I have been advising my fellow IT’ers to start looking at alternative sources of income like Internet Marketing. Internet Marketing will utilize your current skill set while affording you th opportunity ot acquire new skills. Internet Marketing allows you do diversify your income streams so that you are not relying on a single source of income any longer. As you scale up your business you can even outsource some of your tasks to developing countries! Ironic huh?

Dec
07

Why Federal Workers should be Concerned about Outsourcing and their IT Jobs

US Government’s 25 Point Implementation Plan to Reform Federal IT

I would love to hear from federal workers on this one and see how comfortable they are about their IT Jobs. Here is a brief summary of the Government’s plan to reduce IT Costs:

  • Turnaround or terminate at least on third of underperforming projects in IT portfolio within the next eighteen months
  • Shift to a “Cloud First” policy. Each agency will identify three “must move” services within three months, and move one of those services to the cloud within twelve months and the remaining two within eighteen months.
  • Reduce the number of Federal Data Centers by at least 800 by 2015.
  • Only approve funding of major IT Programs that:
      • Have a dedicated program manager and a fully staffed integrated program team.
      • Use a modular approach with usable functionality delivered every six months.
      • Use a specialized IT acquisition professional.

Look at bullet number 3! Close 800 data centers by 2015? This effort is know as the Federal Data Center Consolidation Initiative (FDCCI). If you work in IT and hear the “Consolidation” word, rest assured that equates to job loss. Management of the FDCCI was kind enough to put together a FAQ and the question below addresses the concern over job loss:

What will be the impact on jobs as a result of this effort?

“As with any consolidation effort there will be some effect on the workforce.  However, with limited IT human resources in agencies, the effort is expected to repurpose FTEs so the data center workforce is able to focus less on maintenance and more on strategic IT initiatives.”

Based on my experience in the IT Outsourcing sector I can safely say that the answer above is nothing more than a whitewash – heads will roll, and a lot of IT Jobs will be lost. Those that lose their IT Jobs will enter a job market that is starting to feel the cumulative effects of consolidation, automation, and offshoring. Offshoring is having a huge impact. Even small businesses are at the point where they can list their projects on sites such as scriptlance.com and get qualified App Developers, Server Admins, and DBA’s at rock bottom prices!

That is why everyone needs a back up plan!


		
Nov
04

What the US Bureau of Labor and Statistics Doesn’t Tell You about IT Jobs!

photo by: Torkild Retvedt

 The Impact of Outsourcing and Offshoring on US Government IT Jobs!

If you were to go out to the Bureau of Labor Statistics web site and look at the prospect for IT Jobs the picture would be very rosy indeed! Better than average job growth in just about any IT job category you pick, from Database Admins to Web developers. Yes, the US government thinks things are looking pretty good in the world of IT Jobs. I, on the other hand, am not too sure. I don’t claim to know what methodology they used to come up with their outlook projections (but I am in the process of finding out), but I’m not sure they have taken some of the latest trends into consideration. Most large IT organizations have been automating their environments for years in order to increase the server to people ratio. This applies to most aspects of IT, from System Architects to Server Admins to DBA’s etc. etc.. Offshoring has been another major trend over the last decade that has impacted IT Jobs in the US. It started out with Service Desk functions and has expanded to just about every IT role imaginable.

Now, not all is gloomy though, the thing about IT jobs is that new ones are cropping up all the time as newer technologies such as Virtualization, Cloud Computing, and Software as a Service gain traction in the commercial world. But for every IT role that is lost due to automation, outsourcing, offshoring and just plain old obsolescence, how many new ones are created in the US and other developed countries? My contention is that it will be the developing countries that see the lion’s share of growth in IT Jobs.

So, what to do? Well, I believe that the days of safely working for a large corporation have come to an end. Jumping from one IT shop to another is like playing a game of musical chairs, a certain number of players are going to be left out in the cold when the music ends. Luckily we have some information on this site that will enable you to start down the path of being your own boss. Is this a get rich quick kind of thing? No, you will still have to bust your ass, but you will now be busting it for yourself and will be rewarded accordingly. There will be a learning curve too, this path is not rocket science but you need to have the ability to wrap your head around a lot of information. The nice thing about it? You can start while holding down your current job, and it is definitely not multi-level marketing. You will be able to show up at a party and not be “that guy” that everyone is trying to avoid. Want more info? Check it out here!

Nov
04

IT Jobs, Outsourcing and Offshoring, is it time to get out?

This website is primarily written for ex IT Professionals or current IT Professionals looking to get out from under the corporate umbrella. As more and more developing countries increase their technological infrastructure and technical knowledge, IT jobs will outsourced and offshored from countries where labor costs are high to these emerging tech markets with much lower labor costs. This is a simple fact of life in a capitalistic world. Capital (i.e. jobs, money and other resources) will take the path of least resistance (higher profit). Protectionism will not work because in a global economy, the capital markets will punish any acts of protectionism by shifting even more resources away from the culprits.

The US and other governments whose populations are being impacted by this phenomena have done an extremely poor job of addressing this at the micro level, you know, the level where you and I live. Over time all of these shifts should reach an equilibrium point and stabilize as populations in developing countries see increasing levels of income, thus slowing the whole process down. In the meantime are you going to sit idly by? This site is all about looking at your options. As an current or ex IT professional you have a skill set that you can use in the field of Internet Marketing. My posts and my pages on this site will look at the various options and opportunities that Internet Marketing presents to people with the right skill sets and the ability to RTFM!

I want this to be an intellectual exercise rather than just a cook book to make money on the Internet. We are living in a time when all of the landscapes that make up our lives will be changing with ever greater speed. Geographical, Political, Technological, and Economical, all are in phases of disruptive change. We need to develop survival strategies for these changes. If Ray Kurzweil is to be believed, we are on the cusp of the mother of all disruptive changes, a Technological Singularity Event that will change the world as we know it, but I will leave that for another post. Please explore this site and take advantage of the how-to’s and other tools that will be appearing shortly.

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