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Outsourcing to India
Kobayashi-Hillary M., Springer-Verlag, 2004. Type: Book (9783540208556)
Date Reviewed: Dec 6 2004

After the dot-com bust, the generally weak US economy has driven unemployment rates for the information technology (IT) profession from 1.9 percent, in 1999, to 5.9 percent, in the first half of 2003. A trend that has contributed to that situation is offshore outsourcing, where the value of outsourced IT work soared from less than $300 million, in 1995, to more than $1.2 billion, in 2001 [1]. While “normal” (IT) outsourcing moves tasks (and jobs) from one company to another (more specialized) subcontractor within one’s country, offshore outsourcing transfers most of the activities to quite remote countries, such as India or China.

This book presents many facets of offshore outsourcing, in particular to India, ranging from cultural differences to the outsourcing industry, and covers some of the important steps and elements of the outsourcing decision making and transfer process.

The book is geared toward corporate management, as well as project management, which already has (or will have, in a short time) outsourcing in general, and offshore outsourcing in particular, on its agenda. The book is written in a readable style, and avoids technical jargon, which makes the contents accessible to readers without any particular prior technical or managerial education.

Part 1, chapters 1 through 6, constitutes an introduction to India. Indian history and religion, and contemporary Indian politics and culture, are covered, as well as food, domestic travel, and security concerns (namely, natural disasters, and conflicts with Pakistan and Kashmir).

Part 2, chapters 7 through 11, introduces the outsourcing industry in India. Starting with an overview of outsourcing drivers, the big three players (Infosys, Wipro, and TCS), and four minor players (also in business process outsourcing), are portrayed, in a somewhat careless and very superficial way. For instance, if you cannot decode acronyms like CMM-5, it is not clear from the book what particular services these companies really provide (namely, software development outsourcing, as opposed to IT infrastructure outsourcing). Major outsourcing locations, and industry associations and research bodies in India, are also briefly mentioned, together with outsourcing ownership or partnership models.

Part 3, chapters 12 through 23, makes up nearly 50 percent of the book, and contains discussions of: outsourcing objectives, a comparison of India to other outsourcing destinations, an overview of different outsourcing flavors (namely, tactical versus strategic outsourcing and IT outsourcing versus business process outsourcing), success criteria, vendor selection process, legal considerations, quality issues and service level agreements, migration and transition issues, culture and communication issues, organizational issues, and employment issues.

Supported by the UK’s National Outsourcing Association (NOA), the book paints a fairly ideal, unbalanced, and uncritical picture of the benefits of offshore outsourcing to India, without engaging in a thorough discussion of the pros and cons. Arguments against offshore outsourcing are collectively, and without substantial involvement, dismissed as (wrong) beliefs of the “ordinary people” (page 65), or even put in the vicinity of Mexican freedom fighters, or the 1995 Japanese sarin gas attack (page 66), as some form of resistance to the (inevitable and positive, thus the main tenet of the book) change of globalization.

The book basically consists of a highly readable summary of six other (and partly recommended) books on IT outsourcing, applied to the special case of offshoring, which, combined with some interviews (email or telephone) with their authors or other academics, added to the author’s own limited experience in offshore outsourcing, as a project leader at a financial institution.

While full credit and references are given to all external sources, the book does not create a single coherent or consistent framework on offshore outsourcing on its own, but rather repeats unchallenging and uncritical external advice, and does not address sometimes conflicting priorities or issues. Moreover, elements regarded as important in one section, by one expert, might not be referred to in later sections, because there’s a different expert giving the advice.

Various checklists are presented to facilitate concrete planning or activities, which indeed may be of real value to a first-time outsourcer. Unfortunately, however, some checklists miss crucial and critical information (for example, liabilities, representation, and warranties are missing in a list of the “main imperatives of the offshore outsourcing contract”). This renders the book almost dangerous for use by a nonspecialist, since one can never be sure that all of the important concepts have really been covered.

The book contains, scattered throughout the chapters, some excellent crucial questions for IT and top management to answer, which really would make a difference. Sadly, the author mostly refrains from providing substantial clues on how to actually address these profound issues, leaving behind a frustrated reader.

Bearing the aforementioned shortcomings, and evident bias in favor of outsourcing, in mind, the book can provide value in its introduction to India and India’s IT outsourcing market, and the summarization of some selected important issues, and crucial questions, for anyone interested in offshore outsourcing.

Reviewer:  Christoph F. Strnadl Review #: CR130497 (0508-0883)
1) O'Neal, Mike Restructuring computing programs to meet employment challenges. IEEE Computer 37, 11(2004), 29–34.
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