Six Outsourcing Stories to Challenge Your Opinion

Our story about Harley-Davidson’s decision to outsource a number of IT jobs to Infosys has generated quite a discussion, as evidenced by the comments people have added to it.

The story represents a perfect storm on the subject of outsourcing: Not only are jobs being lost, but they’re being lost from a company that many people regard as All-American. That hurts. (In fairness, I should point out that as part of the deal, Infosys committed to hiring some of the displaced employees and building a facility in Harley-Davidson’s hometown of Milwaukee.)

Given the backlash seen on Susan’s post, I’ve compiled some of our past stories on outsourcing. From the 30,000 foot view, they tell a better story than on-the-ground reports like the one from Harley-Davidson. Read them, draw your own conclusions, and let me know what you think by posting your own comments below.

27 Responses to “Six Outsourcing Stories to Challenge Your Opinion”

  1. When US employers outsource jobs to another country its bad for workers seeking employment in the US. I dont own a business, and I do live in the US. I work at the bottom and I am telling you that if I was a business owner and couldnt make a go of it in the US then the doors are closing. US companies, especially the multi nationals need to understand something. You can chase the the almighty bottom line but guess what who are you going to sell to when only a few can afford to buy? Everyone loses! I believe this is where we are headed.

    • John doe

      pretty much answers the issue. I am particularly interested in what our federal government has to say about it? I mean our wonderful president has been out stumping. Where is the debate on this issue? By any chance did any of you see the you tibe videos of the lawyers telling corporate america how to side step the laws and not hire it’s own citizens? Don’t we have a couple of lawyers in the white house? HE!! we gots us a darn constitutional law professor as president. Dang we should have already been done fixed this mess up. Oh wait that’s right.gwb was a total slimeball … hhhhhhmmm “As the United States Turns…..” Tune next week or month to see if the election mud slinging continues. Check back to see if the paul ryan budget get’s through and if the baby boomers actually care about anything other than themselves.(bing)(bing)(bing)(bing)(bing) (BONG)!!!!! As the United States Turns…..”

  2. macmanjim

    Something like 55-60% of a HD bike is assembled from parts outsourced internationally. From my point of view, it’s not surprising. So much for the made in America mystique.

  3. If we want jobs to stay in the US than we should make it a friendly place to do business.
    Why do we allow things that make us less than the #1 place to do business with all of our advantages? ( for one)

    We should focus on individual opportunity – when we allow people to individually get ahead, everyone is raised up.

    Success should be sought wherever it can be found, people helped where ever they can be helped. If that means outsourcing so be it. Operating in a loosing or less than optimal environment isn’t a good use of life.

    Those who don’t like it should focus on the causes, not the symptom: provide better motivations for investment to stay, and come.

  4. michaelvella

    Could someone please inform the writer that using terms like “30000 foot view” immediately discredits what they are saying? Because anyone throws these phrases around needs to go into the conversation penalty box.

  5. Sushant

    It is surprising to see all this coming from the very proponents of market economy and globalization. When this was started, it was beneficial for you and so you wanted this to be norm. Alright, everybody fell line. But now the game has changed. India and China are playing by all american market economy rules. The one who produces the best/most advanced/the highest quality/cheapest (as the need of the company may be). prevails in the market. So if anyone wants to be in the market, face the competition. Pull up your socks and make a better product/service. And this is going to be the way from here onward.

    And as we have seen that the market economy is ultimate the way by the successes of countries like USA,UK, Germany etc. it is disheartening to see people asking for protectionism in US. India and china have been doing that in many sectors which has done nothing but giving rise to more and more corruption in these countries. I look forward to the day when these sectors are freed and development will follow.

    All this validates Darwin’s principle.. Survival of the fittest!

    • Craig Hook

      Ok, but the Outsource employees do not pay US taxes, Social Security. Just those costs alone, we are not on a level or fair playing field.

      STOP the H1B program it is a sham.

      • Sushant

        Please get your facts checked. H1B visa holders pay social security and medicare even if all of them do not stay in the US after 6 years which is the validity period of that visa. And i am of the opinion that all the H1B/B1/L1 visa holders should be paying taxes of the land they work in. It is not fair to come to a country, earn money and contribute nothing to its society.

        I wonder why the focus of such discussions has always been on ‘IT’ outsourcing when there is still a lot IT work done in the US. But the manufacturing sector has been vanishing like anything. I see lesser and lesser things with ‘made in america’ tag. And manufacturing does employ many more people that IT.

    • AngelaCJ

      I might agree with your statements if it were as easy for Americans to go to other countries to work and get work visas as it is for others to come to the United States and work. The truth is no one wants a global economy unless it benefits them. Also, other countries seem more willing to train its citizens at little or no cost than the US. For the US everything including education is about making a profit, we don’t seem to have any national pride. Do you genuinely think that given the reverse situation other countries would send their better paying jobs to the US.

      I think this is not about Survival of the Fittest, and more about Survival of the Greediest.

      • Sushant

        Other countries are following US footsteps. US has been a welcoming country for immigrants. And it is a matter of fact that immigrants have contributed in immensely in building this country.
        You are right when you say that other countries have no such programs but it has been just a short while since other countries have become part of global economy. India became open 20 years back. So economies like India have been evolving and maturing. And there would be a time in future when companies in these countries will need people from other countries and they will have to come up with such programs. There will be immigrants and these countries which will contribute to their growth.
        And i dont think that it is a matter of national pride to not to outsource jobs. Every citizen is proud of his country. In my opinion, american corporations have become so huge that they have to make such decisions because at the end of they have keep the company going.
        And about training people, these countries have been working hard on educating their human capital. if there would not have been quality work, nobody would have sent the work there just because its cheap. The focus of these countries is educating people in the job generating fields like medical, engineering, law rather than courses like arts, history etc (No offense intended).

  6. I came from a company in Minnesota that decided to outsource its people to the Phillipines. Its a pharmacy benefit industry where understanding each other is vital. I have been unemployed ever since then with healthcare customer service skills and struggle to get a job. So, hearing about another outsourcing by Harley Davidson is infruriating. Our economy and employment won’t get better until companies stop doing this!

  7. Craig Hook

    Outsourced.. yea, HD outsourcer pays $18.50 for the same US working needing $40/hr to pay the taxes, health insurance, feed and clothe his/her family and have enough left over to buy a Harley. Get real !.

    Posted this article to the local IT news group and there was outrage. Yea, Mitt for President, lets do it some more.

    • Jimmy Lozano

      —-“” HD outsourcer pays $18.50 for the same US working needing $40/hr to pay the taxes, health insurance, feed and clothe his/her family and have enough left over to buy a Harley. “”—-

      Good Point Craig

      I’m totally agree…

  8. Am I the only one that read “[HD]” reportedly insisted that Infosys set up shop in Milwaukee — where Harley-Davidson is based — if it wanted the contract.”. With today’s economy and the high cost of employee overhead, outsourcing may be a better way to get the most ‘bang for the buck’ as long as the IT company is located in the US and hires only US citizens. It sounds like a great way to get fresh eyes on issues and tap into a larger knowledgebase.

  9. RegularGuy

    Infosys will hire some displaced HD workers, but it will keep them on only long enough to train their own people as replacements. Within a year, ALL the HD workers and managers will be gone.

    As for the ‘facility’ in Milwaukee, what EXACTLY does that mean? A storefront office? Naturally, Infosys never mentions WHO will staff any WI location it opens. Hint: It won’t be Wisconsin residents.

  10. michaelvella

    Companies can and will keep outsourcing so long as it’s cheaper for them to do so. EVEN IF it’s NOT cheaper for them in the long run.
    And often it’s not. It’s all about the quarterly profits. Nothing else matters.

  11. In each and every case where outsourcing is tried as a way to increase profits the parent company loses; they lose core competencies which are important in the international competitive market. In an attempt to retain these elements they rent foreign surrogates who work for less money and use the profits to boost the bottom line; in this way they justify their outrageous salaries. Note: the multiplier which is used to compare “ordinary” workers’ wages to that of upper management is astronomically higher in the US compared to that factor in the countries where the outsourced labor is furnished, and is obscenely higher than that historically employed in the U.S. The latest wrinkle in this con is the nearsourcing of outsourced workers who are still a part of the same sick equation. In each case the result is the same: loss of jobs for the American worker. There are bright spots, however. GM is in the forefront of a movement to bring these jobs back into the fold; the value of the IT worker base is finally being seen as a strategic asset that is a competitive edge in a world economy. Good for them; now to get the C-level employees to see that manufacturing is just as strategic to our economic security. Without a change such as this we will be seeing C-level used-to-be’s as their companies are taken over by foreign interests. Where is the “Greatest Generation” now that we need them again? It’s us, folks. Man up and stand against the rapacious b******s who would sell their country to the highest bidder.

  12. GE has outsourcde tens of thousands of IT jobs, moved GE Healthcare HQ to Europe, not to mention it has a metric to make sure no business unit does bring back an IT position. Gary Reiner over saw this strategy, probably the single largest outsourcer of IT jobs worldwide.

    All of that, and they got a 3.2 billion dollar refund.
    Watching their Olympic ads makes even an Obama Super PAC blush.

  13. I was witness to outsourced IT jobs. The company’s database was accessible overseas and an IT developer sold our Identities on the black market! There is no USA laws that we can impose on these offshore companies but only.. take our business elsewhere.

    When you outsource,. you are giving away your competitive database to the world!

    I have seen Indian programmers screw up so badly even with clearly written and agreed upon technical specs that even my child could have follow instructions better. The culture is a big setback to working with offshore folks. These programmers never tested their stuff. Needless to say.. it was INFORSYS! I have emails. and documents showing they could not even FOLLOW worldwide industry standards! Why? they were trained quickly and certainly not thouroughly. why the big push for H1 so they can be trained at the American companies that will lay off their American workers.

    WAKE UP CORPORATE CEOs. you offshore you sold us.. YOUR CONSUMERS our confidential information that is sold on the black market. Hence, CITIGROUP who offshored too. “the IDENTITY THEFT” campaign! GO AHEAD SELL OFF OUR social security #, credit card #, etc.. don;t have a job because you outsourced, lost my home so have no credit, and credit cards are maxed out cause you laid us AMERICAN workers off. CAN”t get welfare till the bank repos my house..

    YEAH offshoring our jobs is the AMERICAN THING TO DO.

  14. A new CIO joined the company and tried to prove him/herself by showing that he can outsource and save the company money without any thought to the ramifications of quality, output, and feasibility.
    Hooray for the new CIO! (Who will be in this post for just a few years and make sure it’s on his/her resume)

  15. Jimmy Lozano

    Is very interesting read all SUSHANTS comment’s trying to defend the outsourced jobs in USA.
    But particularly in those statements:

    —-“” In my opinion, american corporations have become so huge that they have to make such decisions because at the end of they have keep the company going. “”—-
    —-“” if there would not have been quality work, nobody would have sent the work there just because its cheap. “”—-

    I AM NOT AGREE when said: there are NOT quality work in USA right now, “of course there are quality workers here in USA”… and many of them are UNEMPLOYED right now.
    So…when: –“” american corporations have become so huge that they have to make such decisions “”–, to me, THEY: –“” would have sent the work there just because its cheap. “”–

    I need to finish with this statement from AngelaCJ, because I’M TOTALLY AGREE

    —-“” I think this is not about Survival of the Fittest, and more about Survival of the Greediest. “”—-

    • Craig Hook

      I is long past time to kick ALL H1B’s out of the USA.

      They do not do quality work by default, they just work cheap, and do not have to pay US taxes. Write you congressman and lets move forward on this, then STOP the paying outsource companies, and or make them pay US TAXES in US DOLLARS for the jobs they are taking overseas.

      • webknight18

        I think u r getting confused here. H1Bs are people who work in the US, so they have to pay taxes. When jobs are outsourced to India then the employees there would not need to pay US taxes.

  16. I worked for Harley-Davidson at Juneau Ave. as a senior programmer and a for 4 years up to the end of February 2012. H-D used the Office Space tactic of bringing in the “Bobs” to evaluate our jobs. They had just used the “Bobs” on the engineers and did the same thing to them that we read about in this article. They got to apply for their jobs as a consultant. Is that a fair option? Is that keeping jobs in America and H-D’s claim to be American made valid (I even have more info about how they screwed the union workers)? Do these employees really have a career anymore in this company? My reply is no and here are my reasons. H-D has a policy that contract workers can work a maximum of 2 years with the company so all my friends and co-workers who get hired back and only going to have that job for 2 more years. The benefits that they had are now erased. Insurance was good, they no longer can use work-out facilities, the vacation time will not be the 4 weeks + holidays that they had…Ironically, the company I am with now has had a contract with Infosys for 10 years. The guys from India quit on a weekly basis – they are a equivalent to an IT sweat shop. Not only has H-D abandoned their employees with their mortgages, their spouses and kids, they also abandoned the local universities like UW-Whitewater, UW-Milwaukee, and Marquette U. Kids who had built up enormous debt and now lost another career option. H-D saved a few bucks but they lost the community, they lost dedicated home grown employees, they lost the local universities, and they lost their made in america claim.

    • What Harley stock holders and fired IT workers need to watch for, is how much the CIO is compensated for moving American skill technical workers to a country. Study after study shows outsourcing reduces services and the quality and any immediate financial benefit is gone in 3-5 years. So, good luck to Harley, good luck to their CIO. The other interest would be if the Obama administration offers them a the standard tax break for putting American workers out on the street and onto government programs like unemployment and welfare.

  17. VWFringe

    I would just like to remind people of some facts:

    our television/radio/newspapers are now owned by six major corporations, and the first rule of journalism is: Don’t disrespect the product, in any basic way. So, television must, by contract, filter out anything that would be embarrassing to any of their corporate sponsors or political candidates. Add to that they help us select our political candidates, or at least dictate who is never seen on television, no matter how popular they are across the country (google Buddy Roemer or Dr. Stein). We have given them too much control – everytime I hear about a public opinion poll, I cringe inside, knowing their responses were pretty much dictated by what comes out of a television…and it’s really not like the Cliff’s Notes we believed it to be, it’s more like Psy-Ops aimed at our ADHD population, taking advantage of the fact that many ARE limited to taking in new information by television. Taking advantage of a level of psychological control so despicable – what special place in hell must there be for a man willing to mislead a nation to protect his, or anothers, greed with fear-mongering? I hope…ah, not really, but they need help, and we need to learn to doubt even something so ubiquitous at the Evening News, and reverse engineer a story or two, look at the spin after researching what they said compared to whatever controversy lies beneath, then do that again and again for a few months, and you will notice their (Television Networks) political agenda become clear to you, you will then be “Shock Proof” to some degree, and will more or less immediately see where their framing diverges from everyone else’s (and your own), know the political wind, and be better able to decide where you stand – because I’m telling you, a lot of the shit they’re getting away with demands our attention and response. Too much corporate enclosing of The Commons, too much focus on weakening and dividing the People for political gain, blocking and reversing of Civil Rights, legalizing human rights abuses and avoiding treaties that would save human lives (we are supposed to be like Superman, right? How come we can’t even adopt his single f****** rule of preserving human life – we’ve done more harm in our NeoCon pursuits than can ever be repaid, and until we get that, and f****** act like we can apologize, we’ll see continued retaliations, I just know it. The reason you (think at least) you fine a corporation is to get them to change their poor behavior – our government’s lost its ability to grease the squeky wheel, and acts with impunity to instead silence it. (one example: we have a boarder who protected our daughter against a middle-aged male attacker, but our boarder was convicted of vandalism for breaking his back window to get his attention away from my daughter, who he was throttling, so this kid’s living with us now, has ADHD really bad, and isn’t treating it – isn’t acknowledging the skills he needs to develop and make any plans that can stick (Mini Me), and his Probation Officer comes over and I complain that our boarder’s been unfairly treated while on work program, and would he please look into it, see if he can get the failing “F” erased for that one day. He starts to tell me he has no idea whether the kids on Probation he’s assigned to have ADHD or not, and that they never accept the word of a – I dont remember the adjective, but I said he should know that all of the kids on Probation have ADHD, especially if they got there by behaviors commonly associated with ADHD. He’s never been back, but he got my boarder GPS’d by a judge within a week, told him he had to move out of my house, and put him on house-arrest for a month (he’s still at my house, he doesn’t have anywhere else to go, so let them come drag the kid to the nearest creek-bed where the other homeless people live). Yeah, not where you thought I’d go with that, huh? Same s*** different levels, big and low, parallels exist from micro to macro.

    Two, historically, Capital Hates Labor Unions – because they represent an area where they don’t have complete control. See, its’ not a law you have to help people plan for their retirements, help them save a little bit so they won’t be burden on the public, so companies are entitled to try to snake out of any agreements they’ve made in the past, as long as it’s legal, and the only thing stopping them from laying everyone off is perhaps the power of a union. We owe a lot to unions and the fights they had with companies, like eight hour work days, weekends off. little s*** we take for f****** granted, and maybe even attribute to companies generosity (I know that’s how I viewed it for a long time).

    ANYWAY, when it comes to unions and how companies deal with them we should not accept in any way the picture that’s been painted for us by our television sets. Simply, we have been lied to and continue to be lied to.

    (3) Three Bottom Line is they’re trying to avoid and externalize their long term costs, put them on the public dime, like Walmart. When people say, or think, we need to make our place more suitable and “friendly” to business, I agree there should be a more level playing field, and more and easier knowledge of regulatory changes, but it should not be a f****** race to the bottom, where we end up dying or getting hurt or sick more, like we did before. You cannot f****** make America more cost competitive with India, it’s much less expensive to live in India, and they’re people are just as capable, if even closer to master level by training alone. The only reason you should continue slogging it out in America is responsibility to your community, but it seems they’er teaching us – kind of a mix of messages, isn’t now? Some companies, recognizing they can’t keep avoiding it will pull back from the perhaps more costly providers, in their never-ending Projects…but will they continue to avoid pension plans and negotiations through unions?

    If anybody thinks this fight against the unions doesn’t hurt us all, please google the way Honeywell has dealt with their union problems – hint: in involves nuclear reactors and unskilled scabs after a lock-out – there is just no shame, and no consideration for consequences apparently, when it comes to ideology wars it seems.