Page Three

By eweek  |  Posted 2003-06-23 Print this article Print

In the case of outsourcers using offshore talent, the people doing GMs work may be in countries like India, Pakistan or China. Is that a concern? Were pushing them to do that. We have in excess of 2,000 people in India through outsourcers. We use five or six Indian companies. HP, IBM and EDS are all moving over there to be competitive. Its an outsourced model, and the benefits of the outsourced business model are amazing.
If GM were not outsourced, it could have never moved as fast as it did in the last five years. We would have had to worry about culture change in IT; we would have had to worry about educating our people for an Internet environment and things like that. Instead, we found the companies that had the people. If one company didnt have them, we went with someone else. That enabled us to move very quickly.
The quality from offshore is very good. And it comes with a price advantage too. The world is going there. Where does that leave U.S. IT workers? I believe it will stimulate new opportunities for business in the U.S. In the last few years, we had trouble getting enough IT people. The U.S. wasnt producing enough IT people. So offshoring started. The dot-com boom also drained off talent. The U.S. is still the most significant developer of information technology. But protectionism never played out very well in the U.S. in any industry. A question is: Are enough people getting incentives to go to school for technology degrees as opposed to marketing or law degrees? Does the board of directors ever ask you, "What if something should happen in China or between India and Pakistan?" Sure. But you have to realize that GM is an international company. Our highest growth in the auto business is China. So it isnt just an information technology question. You could also say, "How about your business with Fiat in Italy or Opel in Germany, or in Japan with Suzuki?" GM is a world company, and GMs information is going throughout the world every day. The growth of the auto industry will be much more significant outside the United States than inside the U.S. in the next 10 years. But I have to be extremely cautious of what companies I have do the development and what kind of work I ask them to do. I would never put everything in one bucket. China might be a concern because of security and piracy, but those things over time will be overcome. What other countries besides India are doing a lot of work? China will definitely be a player in the next couple of decades. I think its just starting to develop. You need a lot of people and you need a tremendous educational system that can pump out scientific people. You have to overcome language barriers. But a couple of years ago, people thought there was a language barrier in India, but there are call centers in India today. Clearly, Eastern Europe still has potential, the Philippines, South America, Mexico. Some of them dont have strong educational systems. In China, the growth of the automotive industry is quite amazing. This year or next year, China will go into the No. 3 position in the size of the auto market, behind the U.S. and Japan. China will surpass Germany. Thats much faster than we thought. The question was, "Who would have the capital to buy a vehicle [in China]?" But its happening.


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