|
Situations Responsible for
Job Outsourcing to India
|
Was it only the Dot-Com bust or the 9/11 incidents that caused this scenario? It would indeed be naïve to consider these as the sole factors. They could at most have acted as triggers to what has come to pass. Sooner or later this was bound to happen, what with true blue globalization, that has come out of research papers of scholars into the world of reality. With increased ease in communication and the emergence of a cosmopolitan culture around the world, regional barriers are fast disappearing. Each large city of the world is now a dense mix of colors and cultures.
Globalization
A new era of globalization began in the 1980s and brought along a significant decline in costs of transportation, communication, and production, and considerably improved inter country competitiveness; and broke down trade and cultural barriers among countries. The concept of a sovereign nation has been increasingly questioned in recent years. Some, indeed, have imagined a world without boundaries, without countries. Others who doubt the benefits of globalization have called for increased protectionism and greater regulation of economic activity. Offshore outsourcing is a product of this fast moving globalization and likewise it has its supporters and its detractors.
Communication (Internet / travel)
But for the ease in communication, offshore outsourcing could be unthinkable. The shift from atoms to bytes and bits has made this possible. Distance has become immaterial to many of today's business processes. Business services can reach and be reviewed by the company as many times and in as much time as they would at the site itself. Data transfer and communication time has immensely shortened. The interface too has changed with video communication. where all matters can even be discussed face to face. Often there is the need of the outsourcing company sending 1-2 people to visit the offshore company to start a personal relationship with the programmers they are going to work with and to understand the cultural problems and settings. Once that is done communication via email, chat or phones is sufficient to keep the projects going.
Government Policies and backing
India has written its success story not in spite of the chaotic, robust democracy, but because of it. Decades of Socialist Democracy and affirmative action have allowed the participation of the poorest, for whom education is the only way out. This mindset has led to increased schooling. On another plane, Socialism and import-substitution, produced generations of entrepreneurs who had to develop indigenous products, from blades to satellites, with their own resources. That self-reliance is helping India now: In the past two years, six companies have won prestigious Deming quality awards, and their excellence has triggered a surge in export orders.
Liberalization has taken roots in India and the Government has steadily lowered interest rates, eased up forex restrictions, and freed banks from their social obligations. The governments within India, at the Center as well as in certain States, have realized that India has stumbled upon a goldmine and seem determined to mine this gold. As a result, a renewed support from the government is forthcoming.
With the rupee fully convertible, Indian businesses are now free to invest anywhere. Simultaneously, credit banking has lead to a consumer boom and a new and confident India has emerged even as old problems persist.
Demography
What was a few years ago cause for worry, has turned to India's advantage. The growth of India's population is a big factor in the whole scenario. If it were not for the teeming millions in the country and the government's inability to provide employment to them, the workforce would not have offered cheaper services and appear satisfied to boot. The workforce is too happy to land a job in the first place to bother too much about the salary. Moreover the salary structure has always been low in India so whatever the workforce earns from outsourced jobs is much more than he would get anywhere else.
Even though the literacy levels are still dismal vis-à-vis the developed Nations, India's massive population guarantees a large number of graduates. In terms of total number of graduates, India scores high. This large workforce has been hungering for employment that the country had so far been unable to generate.
By 2020, 47% of Indians will be between the ages of 15 and 59, as compared with 35% now. The working populations of the U.S. and China on the other hand are projected to shrink. With the world's largest population of workers and consumers, India should be able to sustain 7.5% annual growth after 2005.
Social
Education has always been important in India and the status of its citizens has been heavily weighed on the terms of this parameter. Being a society driven by casteism, knowledge has been the easiest way to emerge out of the limitations of caste to a great extent. In fact the highest place in the caste hierarchy has been given to the Pundits or Brahmans because they were the knowledgeable and educated one's, much above the kings and nobles. The Brahman did not have any worldly possessions yet he was the one everyone had to bow before because he was powered with knowledge.
Carrying on from this tradition Indians pride to involve themselves in careers that require education. They enjoy and pride in the status of knowledge workers. For decades maids and drivers and other laborers have gone overseas to look for employment, but they have never been able to be to show pride in the work. Many never disclosed the nature of their work and on the strength of the foreign currency earned tried to gain social respect. But outsourcing especially from the IT field has touched the balance between respectability and riches. Given this respectability the learned group strove towards getting these jobs. These jobs became more preferable than the few respected government jobs that were available. The growing middle class that had gained respect over the years found this the best way out, for they had now the choice of not being forced into what they considered lowly jobs.
As a result the whole system now revolved around this new class of knowledge workers who also earned a neat packet by Indian standards. Father's of girls preferred grooms from this section. Every parent dreamed of his/her ward employed in this sector. But visas and foreign travel was expensive as well as difficult. Moreover parents got separated from their children, and even though they were happy for their children they missed them. The children too missed the social life they had back home, the servants they could afford and the social appreciation that was not easily available in foreign shores.
Outsourcing solved a lot of those problems, The not so rich parent no longer had to dole out lots of cash to send his child overseas, nor did he have to get separated from him for years together. The jobs were coming home and all kinds of people with various levels of qualifications could now get these coveted jobs. The pay may not be as high as in the foreign lands but it surely was enough to make him live life king-size back home among appreciative relatives and a support system.
On the other hand education has taken a beating in the developed Nations. The youth has been in a hurry to earn even as teenagers and have therefore given more priority to earning rather than to learning. Moreover the society is not so averse to what in India is considered lowly jobs. A respectable family would never allow its children to work as waiters, painters, drivers and such things because the class divide and consciousness is too high in India. Moreover the wages ensure that such class differences are maintained. In developed nations the line of division is very thin and social interaction is more at par.
Daniel H. Pink aptly summarizes the social causes of the American outburst against India. "What makes this latest upheaval so disorienting for Americans is its speed. Agriculture jobs provided decent livelihoods for at least 80 years before the rules changed and working in the factory became the norm. Those industrial jobs endured for some 40 years before the twin pressures of cheap competition overseas and laborsaving automation at home rewrote the rules again. IT jobs - the kind of high-skill knowledge work that was supposed to be our future - are facing the same sort of realignment after only 20 years or so. The upheaval is occurring not across generations, but within individual careers. The rules are being rewritten while people are still playing the game. And that seems unjust.
Couple those changed rules with the ham-fisted public relations of the American companies doing the outsourcing and it's understandable why programmers are so pissed. It makes sense that they're lashing out at the H1-B and L-1 visas. US immigration policies are a proxy for forces that are harder to identify and combat. It's easier to attack visible laws than it is to restrain the invisible hand. To be sure, many of these policies, especially the L-1, have been abused. American programmers have done an effective job of highlighting these abuses - and during an election year, Congress will likely enact some reforms. But even if these visa programs were eliminated altogether, not much would change in the long run."
Economic
The economic factor has been greatly highlighted in this issue. Even though it is indeed a major factor in the process, analysts have been overlooking the other very important factors. It is true that if it were not due to economic reasons outsourcing would have never happened. It works both ways for the people who outsource as well as for those that take up the jobs. Cutting costs has been the major concern of companies who are faced not only with recession but also with growing competition. Coupled with that is the growing stature of a fussy and smart consumer who wants the best for the least. Development of easy transportability and service delivery has given the consumer a global market and he is willing to make the best of it. This has made it imperative for companies to deliver to the demands of the consumer.
Developed nations have had a good per capita income. Their workforce is used to the high wages and is therefore unwilling to comply with lower wages.
Language
Even as certain part of the Indian think tank described the gaining popularity of English as a medium of education, a hangover of British Slavery, Indians continued to learn the language because it had already become a status symbol. Also some states who felt Hindi, the National language, had been imposed upon them preferred the use of English to connect them to the other parts of India; and English which was stipulated to be phased out as the official language of the government refused to step down. Moreover, English was gaining global acceptance and Indians were unwilling to limit themselves. In this background, when IT happened and English became the lingua franca of the Internet, the Indian smoothly fitted in. It had the largest population of English speaking people among the third world countries. China and Japan who had technologically challenged the US and raced ahead in manufacturing could not do a repeat performance, as its populace had never mastered foreign languages. India is a multi - language society and many speak at least three languages. As a society they are very comfortable with a multi-lingual system and schools all over India follow the 3-language formula envisaged by former Prime Minister Mr. Rajiv Gandhi. This was done with the intention of National Integration. However, with Globalization benefiting Indians and their will to take on the world; more and more children are learning foreign languages at school. Of the three languages two are Global and the third is mostly the mother tongue. Generally English or the mother tongue forms the medium of education and the next important language that is studied. Thus English is at most the second language studied. In many English medium schools, however the second language is either German or French. Even though the USA forms the largest outsourcer, India could soon be changing focus to Europe as its populace is increasingly being trained in European languages.
Location
Being located on the other side of the world gives the advantage of time difference to India and some companies find it a definite advantage. In fact many companies are giving users in Europe and the USA the choice to choose the place of service in processing their bills and insurance documents, but always warn them of the time advantage they get if they get their jobs processed in India. Consumers are told that if they choose to process in India they may get the required job done in a day or if they choose a local service they get the same thing done in two days. The growing resentment towards Asians has also made call centers provide an option.
|
|
|
|
