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3/25/2009
09:54 AM
Bob Evans
Bob Evans
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Global CIO: The Ugly And Dangerous Prejudice Against Outsourcing

If American businesses yield to the anti-outsourcing caterwaulers, then don't be surprised to see them go after other equally legitimate business tools next.

So explain this one to me: When great IT companies develop new products and services that offer significant value to CIOs, we call it innovation. But when CIOs employ outsourcing to remain competitive and create new customer value, the outrage industry calls it anti-American and screeches about the loss of "our jobs."

This ugly and ill-informed nonsense has been going on for the past 10 years, which is about 10 years too many. Because if American businesses begin to yield even a single inch to the anti-outsourcing caterwaulers, then don't be surprised to see them go after these equally legitimate business tools next:

  • Cisco says its new Unified Computing System could help CIOs cut IT operating costs in the data center and elsewhere by up to 35%, and surely some of that savings would come from reduced head count owing to more automation and more built-in intelligence. But wait -- what about the loss of "our jobs" from such an approach -- doesn't that make the use of such advanced technology unpatriotic?
  • What about some of the lower-cost alternatives being offered by Salesforce.com and other successful SaaS vendors? If the cloud offers a simpler way to run applications, then that means fewer support jobs will be required -- so are cloud and SaaS companies therefore responsible for decimating tens of thousands of "our" IT jobs?
  • Last week, Hewlett-Packard signed a $50 million deal with Korea's Shinhan Bank. To get the work done, should HP shuttle U.S.-based workers back and forth from Korea since HP is, after all, based in the United States and should therefore deploy only "our jobs" on the Shinhan Bank project? And that comes on top of HP senior VP Marius Haas recently citing his company's far-flung development operations in India, Costa Rica, and Europe: "It’s a competitive economy and you go where the talent is."
  • Oracle says that because of the challenging global economy, it's adjusting its hiring practices in the consulting sector by "load-balancing with contractors and integrators" rather than hiring more full-time professional-services employees. Hey, wait a minute -- what about "our jobs"? According to the protectionist lobby, shouldn't Oracle be forced to hire more full-timers and tell all of those contractors and integrators to get busy laying off the workers whom Oracle had been planning to retain to handle the consulting work?

On top of those examples, how about all the other highly intelligent IT products this industry has created in the past 10 years, all of which without question have led to the reduction or even elimination of various types of jobs: virtualization, systems management, network monitoring, rapid-development tools, Web-native software, and many more? Will they be taxed and regulated, or just pilloried as destroyers of "our jobs"?

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CIOs today are being asked to squeeze costs aggressively while also keeping alive innovative projects that will lead to competitive advantage when the global economy improves. Neither those CIOs nor their companies can afford to ignore the very tangible benefits of tapping into the best sources of talent and skills and value the global market has to offer out of fear that some protesters or politicians will carp about it publicly.

And they should stick to their guns for two reasons: first, because doing so makes great business sense; and second, because of the hypocrisy shown by so many of the political class who live by the rule of do as I say, not as I do. Based on precedents, one of the likely carpers will be Sen. John Kerry, who for many years rode stylish motorcycles made in foreign countries: Ducatis from Italy and BMWs from Germany. Most people would say that if those are the bikes he wants to road, go right ahead. But personal preferences aside, Euro-biker Kerry will look to score political points as one of the tub-thumpers who tries to intimidate American corporations into cutting back on outsourcing even though it's in the best interests of those companies and their shareholders and their customers and, yes, their employees to engage in outsourcing.

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