Outsourcing Toolkit
Story: Offshoring behind UK tech-labour divide
Offshoring to India May already not Make Financial Sense
The cost of off shoring to India is very often seen as a purely financial decision based on cost per head of replacing employees within the UK. This is not however the true cost of off shoring with many bean counters in the UK and elsewhere failing to see the bigger picture. Software development for instance can be off shored with a perceived reduction in development costs but the resulting code is rarely of good quality and there is much greater expense in reworking and support over the life of software developed in this way. As a consultant who has to deal with off shoring on daily basis I very often see no savings at all over the lifetime of a software product, and in some cases actually see projects costing a fortune to rework. While it is also true that help desk activities can be off shored this tends to never provide as good a service than in house provision. The costs of poorer service and lost time tend to be hard to calculate so again the perception is that money is saved. I think it will be far less than five years before the economic realities of the true cost of off shoring are seen by businesses in the UK. Many businesses who rely on off shoring are already staring to see even perceived benefits dwindle. In the long term we are also storing up problems for the future by off shoring so much of our IT work as tomorrows IT managers are not currently being employed in lower level jobs within the industry because these jobs no longer exist here. Inflation in India is a ticking time bomb for the IT industry in the UK and companies are going to be in real trouble when it goes off.
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