Only the ignorant disagree with the claim that most outsourcing sucks.
There are three common motivations for outsourcing: market access, inability to grow locally, and cost. Though it’s awkward supporting a remote team close to a key market, it’s good to have the locals deal with hand-holding and localization. Here in Denmark there have been times in the past ten years when the local market simply couldn’t meet hiring demand, and though the East European collaboration solutions were costly, the alternative would have been even more costly. Last, and perhaps most popular among the pointy-haired bosses is the belief that a company can save money with a remote low-cost work force. Everyone seems to know that the last strategy doesn’t work — except pointy-haired bosses so out-of-touch with the factory floor consequences to develop trustworthy opinions.
Most everyone understands the long-term and hidden costs that overshadow the supposed savings. My wife, writing up requirements for a to-be-outsourced product, found that the engineers she was working with could have just written the code in less time than it took to clarify the requirements with her. A partially-outsourced ScrumButt telecom team playing on-line estimation poker found that the estimates from all Indian team members aligned on every throw. The cleanup of code years after remote workers have abandoned it shows up on no outsourcing balance sheet
Outsourcing often smacks of imperialism and even racism. I can’t say it better than can a colleague of mine who relates his insights into an outsourcing firm that targets mostly Indian, Pakistani and African programmers.
Usually the terms for the work are despicable and not realistic. [Some outsourcing firms] offer jobs [iPhone / Android / web app] that you will not get if you bid anything above $10 / hour. This work, if conducted in any western country, would cost closer to $50-$100 per hour...
The conditions are usually terrible. The people bidding for the work need to own the devices ... because the outsourcing party is not going to provide them. Especially in Mac development, this puts considerable burden on the person looking for work. Furthermore, they are forced to install desktop monitoring software that captures their screen ... [T]he line between what is work, and what is not, can be very blurry...[P]eople have had to configure the customer systems, and haven't been able to bill that as work, because they are only paid for work that is truly productive.
... This is pretty much going back to the slavery farm work of the glorious days of imperialism. And it is now also Indonesians and Filipinos who have to take these jobs or face starvation. ...it is economic, territorial, and political [imperialism].
Further, he notes that royalty-based compensation forces the employee to share the risk — ludicrous for royalty percentages between 1% and 5%.
The Scrum vision is based on teams working together to produce product and to equitably share ROI — not an inequitable and opportunistic workforce organization based on rationalized compromising of human principles. I’ve served this year in Serbia and Nepal, and plan to go to Palestine, to help the software communities rise as software kingdoms in their own right instead of being the serfs of a remote lord. A great firm nurtures the innovation and independence of these communities under an economic model that accords most of the benefit to its rightful recipients: those who did the work.
It’s false charity to make others dependent on your firm. Investigate whether your company’s outsourcing helps others create careers — not just jobs.