• United States
Senior Editor

Offshoring, the monster that won’t die

Jul 05, 20042 mins
Enterprise Applications

Few IT topics stir so much emotion, angst, fear and misunderstanding than offshore outsourcing. Rarely a day goes by without some group putting out a new study on the subject. One concludes offshoring is purely the devil’s work that will make the U.S. fall into the sea. The next will show companies moving work offshore are saving billions of dollars and benefiting from it so much that they wish they had done it sooner.

We came across the same schizophrenia in our reporting for this special issue. Many companies didn’t want us to say they were using offshoring, while others were more than happy to tout the practice. Some would talk but wouldn’t let us use their names – there’s a stigma attached, they said.

Meanwhile the topic has hit the mainstream, with federal and state governments weighing in to restrict offshoring. Add to that the presidential election rhetoric, and it’s not hard to understand the confusion that surrounds the topic.

We hope this package will help clarify some of the issues by examining the major offshoring topics.

In our lead story we look at the reasons there is such a dichotomy of views on the subject and look at the reasons companies are offshoring – or not. On the pro side there are important motivations, not the least of which is cost savings. But in a separate piece we look at the downsides, which include everything from language barriers to lost business.

While much of the offshoring discussion has swirled around India, we have a story about emerging countries such as Belarus and Estonia that would like to land that business. That could mean more savings, but infrastructure problems might be insurmountable.

Back in the U.S. we take a look at how offshoring has become a political hot potato. New regulations on the state level are making it difficult for state IT work to be outsourced. Can federal regulations be far behind?

Finally, our package concludes with two industry executives debating whether offshoring’s benefits outweigh its drawbacks.

A Gartner analyst recently predicted that offshoring will lose its stigma in a couple of years because the market will mature and the emotional baggage will fall away. While the furor and FUD might die down, it will take years for those who lost their jobs to forget. This topic will remain an emotional issue for some time to come.