I was reading CNN’s money site and various other similar news sites, and reading how IBM was failing to sell itself to investors. While investing heavily in India since sales there were up, the article cites how this isn’t enough to help their stock. They aren’t the only companies doing this, so selling services merely on price won’t work very well when the competition is doing the same.
My Dad in his business refuses to sell on price and makes it to point to be the most expensive distributor in his region. In fact, the more he raises his prices, the more business he gets. You gotta find that sweet spot, and he can attest to earning that price. Lines such as “call my competition on a Sunday, and see who calls you back”, and other sincere pitches backed with a long list of referrals allow him to stand behind his price vs. in front of it.
So, upon reading that article, and others similar to it (and having the knee jerk reaction of being spooked), I figured it’d be a good time to see what it’d take to outsource myself. I basically outlined some basic Flex programmer qualities I felt prevented me from being outsourced, both on their own and collectively, and justified why people were calling me to come work for their startup or asking my advice on Flex stuff.
I never published it as a blog entry, though, because I felt it grossly neglected all the things I bring to the table, and showed my skill set in a negative light. This wasn’t my intention, but it was just too hard to change. The silver lining I later found, however, is it was a great exercise in self-assessment.
You basically look at why a client would hire someone in another country over you based solely on price. What do you have to offer that the person in another country does not? Do those qualities truly set you apart? If so, how long do they last? Could those qualities be adapted by those in other countries that work for less than you do to give them the competitive edge?
It also shows you what areas you can focus on more and improve, and what areas you can potentially get into, some which are exclusive to locality.
On the flip-side, I was reading a magazine article over the weekend in some business mag (Business Week or Business 2.0) that countered some of the points the CNN article made. For one thing, the CNN article, referring to India, says:
…going to where the programmers are…
Talking about India’s extensive and less expensive talent pool. Yet, the article I read stated issues in that salary rates for Indian employee’s are growing. Indians aren’t stupid, just cheaper. They are realizing they don’t have to work dirt-cheap to be marketable because “they charge less”. I think managers average salaries went up to $32,000. That might not sound like much to those living in San Francisco or New York, but that’s actually not to shabby of a salary in less expensive areas, and I know for a fact you can have a nice flat, your own driver, and maid in India for that much.
The article also stated the high turnover problem and high competition for good talent. Gee, uh… what country does THAT sound like for Flex, Flash, & ColdFusion developers… America!
Even if Indian programmers never start charging as much as American ones do, I’m still excited by globalization. I’m competitive and love to win. Competing with programming talent that’s in 300 million Americans is fun, no doubt, but the big leagues for me are the 700 million tech-savvy Indians between the ages of 15 and 35, and Lord knows how many Chinese, Indonesian, etc. The whole world combined? Bring it!
Even as much as two years ago, I’ve heard of Indian firms charging more than some American firms do for projects. That says volumes. If you’re talent really is that good, and you have the communication network set up that you can facilitate an almost-like-local presence, why NOT charge more?
I still think they’ll have to charge less, namely because of the time zone gap. One of the main reason I turn down startups, aside from my current gig being really cool, is mainly from the fact that I don’t feel like having to deal with people I can’t talk to. While I do pretty well dealing with my current team of telecommuters, even when one is on the west coast, and me being on the east, it can cause challenges. One thing is a definite; without people at least in the same to 1 off time zone, you won’t get immediate resolution to problems. To some large companies who have projects lasting 2 years, that really isnt’ a big deal, nor event worthy detail to them. The consulting firms who have to deal with it might not care either.
I sure do. If I’m held responsible, you better be within choking distance if you start smoking crack… or high five distance if you p@wn a problem. But then, it’s not up to me, but rather the clients that hire you to do the work. If they want immediate resolution, they’ll pay for it.
Anyway, I highly suggest you try it. If you’re not in a country known for being outsourced to, write down things that you think justify why you are not yet outsourced. Hopefully it’s a good self-assessment tool, as well as showcasing potential areas to learn more about, and/or improve upon. The important thing to remember is those qualities are not a definitive list of what really makes you important & valuable to companies, but writing them down certainly helps you add them to your elevator pitch if they are not there already.
6 Replies to “What Does it Take to Outsource You?”
2:00pm here in Australia and I just got off the phone to a potential new client. Came back to read this post and loved the bit about your Dad making a point of being the most expensive.
I basically just did the same on this phone call.
Straight up asked them their budget (Not a huge amount of dollars). Then I told them that I would want the UPPER limit of that budget and pointed them to my site suggesting that they decide if they wanted to use me for the job. Great advice. I have chased jobs on price and they nearly always suck. Clients that make the choice on price alone tend to just push for more and more and try to get too much out of you.
Great points! But you know what? My company gets more business from clients who first go the outsourcing route and get a pile of crap 6 mnths later they call us when they need it done right.
Outsourcing is helping our biz because 90% of outsourced projects totally fail or get really late.
And the best thing is that after the totally negative experience of wasting a huge amount of time and money on outsourcing, they don’t question our process, budgets, or timelines because they’ve already learned the hard way.
Agree with points you made and also what your Dad said. It makes sense to me.
In my opinion, things are changing slowly. Apart from Outsourcing (BPO etc), some companies have staretd product development from India. For example, Macromedia India ( I workd as a part of Flex team and now some teams like Flex, Coldfusion, Jrun, Contribute etc are partially/totally based in India), Adobe India (a great success) etc…
As far as price is concerned, I think prices charged by Indian companies or salaries paid by companies based in India are no cheap/less. For example, A coke-can here costs me half of a dollar where as its around $1+ in USA. So you get the idea, what you call cheap is not cheap. Cheap is a relative word :)
Why India is getting a popular desitation:-
1) Communication (English)
2) Mathematics (Most of the folks have sold Maths background)
3) Economy where less salary (as compared to US standard) makes an engineer happy.
BTW! Programmers in India are getting better day by day. Actually there are great programmers and entrepreneurs. But still programming quality is at average level because of large numbers.
hehe…I really like the idea of globalization because it gives me an oppurtunity to work with great developers from all over world. At the same time, I am expecting more Indians to participate in OpenSource projects, mailing-lists, speak in conferences, blog, dont-maintain-low-profile-anymore, try to write clean code and buy time from they manangers to do that.
It’s great to be a fish in a little pond for a while. It’s kinda like the TV Show ‘Cheers’. Everyone knows your name, everyone is glad you came :) Great place to build confidence in your skillsets.
However, after a while it gets a bit old and bland. You start to venture outside your comfort zone for greater challenges and realize that there are BIG lakes and oceans to explore.
I don’t think your value changes when you venture out into the ocean. It’s just that others may not be willing to pay for your value (at first) because you are now in an enviorment of many more fish that look just like you.
I also don’t think the hardest part of competition in globalization is necessarily in skillsets. It seems like personal branding and what makes you different is key.
Saying ‘I’m a Web Developer’ now means nothing unless you are in a pond with very few Developers. It’s more like: A) I’m a Web Developer that likes ___ B) Believes in ___ C) Passionate about ___ D) Came from ___ etc. etc. etc.
My thoughts may change but so far I see that the pond allows the development of skills and the ocean allows the development of an identitiy.
My 2…er ummm….25 cents :)
Jesse, I will make some nice articles one day but today it is not the right time for me to say anything and I won’t. Anyway, I had always loved reading your articles and I enjoyed reading this one immensely.
Great points Jesse! I appreciated your fresh angle on this problem – doing this excercise/self-inventory periodically will be useful to me but also to my clients…
Comments are closed.