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I would like to join other major stakeholders in the dialogue on offshore outsourcing invited by Harris Miller in Free Spectrum, July 14. Too often, we hear only one side; I would like to recap the pros and cons of offshore outsourcing. Pro: Enterprise executives and our nations leaders appear ignorant when it comes to software. They seem to view dealing with the software culture and its professionals as a personnel management headache and software itself as a commodity, ignoring its strategic value.
The enterprise choosing to engage in offshore outsourcing is rewarded with an immediate, substantial reduction in the cost of its software operations. This is facilitated by a skilled, trained software work force available in the emerging economies that attract offshore outsourcing. Its a work force that experiences less turnover and retraining than its domestic counterpart.
Con: Offshore outsourcing is irreversible. Work sent to emerging economies provides a direct boost to the prosperity of those countries, and it will not be given up easily.
Software has strategic value to enterprises, but enterprise executives and our nations leaders seem ignorant of this. Instead of commoditizing software, the enterprise should accord the head of its software operations a place at the boardroom table.
Software operations are inherently experimental, and the enterprise must foster innovation to obtain its full benefits. Without innovation, products are fated to be bundles of past features and capabilities. Investment is needed to fuel innovation, and its process of experimentation must be tightly knit into the strategic management of the enterprise.
Further, the domestic enterprise will be met with varied, confusing legal systems in which immigration and export-control policies are unstable. Software intellectual property depends on patent and copyright protection that may not apply across national borders.
Software is the object of and vehicle for security attacks, but offshore software developers are not vetted for trustworthiness, and its not possible to do so. Similarly, private information accessible in software developed offshore may be subject to invasion.
Executives who outsource offshore are likely to find they cant exert oversight over what they have outsourced. They may discover their capabilities for determining requirements and specifications are immature and unable to reach those developing the software, putting strategic IT efforts in jeopardy.
Don ONeill is executive vice president of the Center for National Software Studies, a not-for-profit organization focusing on software issues of national importance. His e-mail address is [email protected]. Free Spectrum is a forum for the IT community. Send your comments and submissions to [email protected].