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By David E. Gumpert Offshore Outsourcing: Time to Get Creative Entrepreneurs can't be faulted for a focus on the bottom line. It's when they overlook alternatives to overseas programmers that the finger-pointing should begin The outsourcing of American jobs to India, Russia, and other countries can be viewed from two vantage points. At the so-called "40,000-foot level" are the academics, economists, and technocrats who see it as some sort of grand chess game in which jobs fluidly move about from country to country. Thus, someone like M. Eric Johnson, director of the Glassmeyer/McNamee Center for Digital Strategies at Darmouth College's Tuck Business School, can smugly observe, as he did in a roundtable sponsored by the International Herald Tribune in November, "Low-skill jobs like coding are moving offshore and what's left in their place are more advanced project-management jobs." At ground level, it's a different story for people like Sandy Dragoo, project manager for the computer technology department at Houston Community College. Every day, she must deal with prospective students wanting to learn technology skills to better themselves, and also face recent graduates who can't find jobs. "I tell the career-changers, if you're coming here to make a lot of money, those days are over." As for recent graduates: "They're all disgruntled because the jobs are going away." FRUSTRATION AND ANGER. Unlike the Tuck official, Sandy wants to fight back, by creating some kind of agency that would match her graduates with small businesses that want the best-possible American programmers, software engineers, Web developers, and so forth -- and are willing to be creative about the arrangements. It could be that American employees would take below-market rates, work on a contract basis, or tie their pay to incentive arrangements. The idea, she says, is this: "When companies are considering hiring people, they would talk to someone representing people in this country." Over the last couple of weeks, I have heard from dozens of individuals like Sandy, who are frustrated and upset by the actions and policies of outfits like IBM (IBM ), which recently announced that it would be moving nearly 5,000 programming jobs to India, China, and other countries. (See BW Online's Small Business Small Business Mailbag. Many of these soon-to-be displaced individuals -- technology employees, business owners, and unemployed individuals -- contacted me because they were so taken with the decision by cMarket, a startup in Cambridge, Mass., providing online auction services to nonprofits, to hesitate before sending its programming jobs offshore. As I explained in my last column, cMarket sought out American IT professionals at rates comparable to what the company would have paid had it followed the herd and subcontracted the work to India (see BW Online, 12/2/03, "U.S. Programmers at Overseas Salaries"). While some respondents quibbled with cMarket's exact approach or with the dollars-and-cents logic behind its calculations, nearly all admired the outfit's willingness to entertain the notion that there might be another way to reduce its technology-development costs than go offshore. And therein lies the biggest challenge, in my opinion. Reading between the lines of many of the e-mails I received, I'm struck by the sense of exasperation about the existence of two major bits of conventional wisdom that inhibit many businesses from exploring the American alternative. COUPLE OF CANARDS. First, many companies have simply been afraid to ask Americans to take less money for IT jobs than prevailing rates, which were pushed up by the late-1990s Internet boom. Second, the notion expressed by the Tuck-Dartmouth's Johnson that coding and other such IT tasks are commodities, and thus deserve to be shipped to cheaper-labor countries.
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