OPINION

Near Shore Competition

April 06, 2006
heartcrossings

It was that time of year when existing vendor relationships were studied, analyzed and evaluated. Familiarity breeds contempt, unhappiness and dissatisfaction even when you are one of the outsourcing heavy-weights from India. One morning, the powers that be let it be known that the Indians had been ousted by a Brazilian outsourcing company and that the transition would be completed in the next sixty days.

While desis are very familiar with one Indian vendor being replaced by another in the bitter bidding wars for a large outsourcing contract, being shown the door by the Brazilians was somewhat of a surprise. My interaction with the team from Brazil has been limited but I sense a certain lack of confidence among the outgoing Indian vendor resources as well as the American employees.

They had achieved a certain rapport over the years. Indian festivals were celebrated in the cafeteria, miniature Ganesh and Nataraj idols adorned the desks of American managers. One woman had a colorful dupatta on permanent display in her office. Team lunches were often held at the local desi restaurant since everyone loved the gajar halwa and palak paneer equally. Arranged marriages had been deconstructed to death in the smoking porch as had Bollywood musicals. The desi assimilation of America is naturally presumed. In all that was a lot of cultural bridges built.

The employees are concerned about their ability to communicate effectively with the new team given that very few people know either Spanish or Portuguese. Why they assume that English would not be adequate is hard to explain. They balk at the prospect of learning about a new work culture which they assume will be significantly different from anything they are used to.

For the Brazilian company, their challenge would be rise to the occassion and allay all concerns stated and unstated. This besides being able to complete a fool proof knowledge transfer in sixty days, make the change of guard completely transparent to the business users and deliver a significant cost saving to the company.

Failing on one or more counts could imperil their tentative foot in the door because the Indians are going to try very hard to regain lost ground. Even as competition heats up in the world of outsourcing, India will continue to enjoy significant advantages over later entrants into the game. Needless to say, complacency could prove fatal.

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#1
Aaman
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April 6, 2006
11:55 AM

We recently lost a big deal to another vendor doing the offshore work from China instead of India - the tide rises

#2
Lakshmikanth
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April 6, 2006
11:58 AM

hah.. i have a theory,

China will beat India in EVERY front once chinese learn english.

thats the end of it

#3
heartcrossings
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April 6, 2006
12:29 PM

I would agree about China being able to best India once they learn English. But that would be like a far-shore to far-shore comparison not unlike one Indian outfit beating another in terms of cost.

The near-shore option seems to be a more desirable mainly for reduced travel time and sometimes the less grueling visa paper-work.

There is also the factor of bringing more to the table in an offshore deal than reduced cost. In this example the Indian team never tapped on opportunities to be a differentiator in their offering to the client. They just functioned like mindless bots and bots are easy enough to replace.

India has the advantage in being the first entrant to offer more than cost savings. Its a pity that they don't try nearly hard enough.

#4
Lakshmikanth
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April 6, 2006
12:43 PM

Its not that we try hard enough .. its that we dont have many aggressive people, IMHO.

From my experience, most of them are complacent if they get a smooth going project.

The aggressive people are the people who are marketing their services here. They are few.

The guy back home is mostly in a different world, s/he lives in a comfortable, lavish aura.. where the money flow is continuous (mostly in the case of extablished companies)

Another fact is that we do not have an edge other than english. Technologically any Chinese/Brazilian/Pakistani/African would do as much as an Average Indian Coding guy does. Unless we develop people, sociologically to become better engineers. ITs just a matter of time where we would lost out all our contracts to china.

Developing the edge also matters. That edge comes from a socio-economic angle, and also when research and innovation would be more emphasized, rather than just plain and dry coding.

#5
heartcrossings
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April 6, 2006
01:01 PM

Totally agree with Lakshmikanth on :

Technologically any Chinese/Brazilian/Pakistani/African would do as much as an Average Indian Coding guy does. Unless we develop people, sociologically to become better engineers. ITs just a matter of time where we would lost out all our contracts to china.

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