Emergic: Rajesh Jain's Blog

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Wired on Indian Outsourcing

January 29th, 2004 · No Comments

Wired (Daniel Pink) describes how “India became the capital of the computing revolution”:

What begins to seep through their well-tiled arguments about quality, efficiency, and optimization is a view that Americans, who have long celebrated the sweetness of dynamic capitalism, must get used to the concept that it works for non-Americans, too. Programming jobs have delivered a nice upper-middle-class lifestyle to the people in this room [in India]. They own apartments. They drive new cars. They surf the Internet and watch American television and sip cappuccinos. Isn’t the emergence of a vibrant middle class in an otherwise poor country a spectacular achievement, the very confirmation of the wonders of globalization – not to mention a new market for American goods and services? And if this transition pinches a little, aren’t Americans being a tad hypocritical by whining about it? After all, where is it written that IT jobs somehow belong to Americans – and that any non-American who does such work is stealing the job from its rightful owner?

A century ago, 40 percent of Americans worked on farms. Today, the farm sector employs about 3 percent of our workforce. But our agriculture economy still outproduces all but two countries. Fifty years ago, most of the US labor force worked in factories. Today, only about 14 percent is in manufacturing. But we’ve still got the largest manufacturing economy in the world – worth about $1.9 trillion in 2002. We’ve seen this movie before – and it’s always had a happy ending. The only difference this time is that the protagonists are forging pixels instead of steel. And accountants, financial analysts, and other number crunchers, prepare for your close-up. Your jobs are next. After all, to export sneakers or sweatshirts, companies need an intercontinental supply chain. To export software or spreadsheets, somebody just needs to hit Return.

What makes this latest upheaval so disorienting for Americans is its speed. Agriculture jobs provided decent livelihoods for at least 80 years before the rules changed and working in the factory became the norm. Those industrial jobs endured for some 40 years before the twin pressures of cheap competition overseas and labor-saving automation at home rewrote the rules again. IT jobs – the kind of high-skill knowledge work that was supposed to be our future – are facing the same sort of realignment after only 20 years or so. The upheaval is occurring not across generations, but within individual careers. The rules are being rewritten while people are still playing the game. And that seems unjust.

As I meet programmers and executives, I hear lots of talk about quality and focus and ISO and CMM certifications and getting the details right. But never – not once – does anybody mention innovation, creativity, or changing the world. Again, it reminds me of Japan in the ’80s – dedicated to continuous improvement but often at the expense of bolder leaps of possibility.

And therein lies the opportunity for Americans. It’s inevitable that certain things – fabrication, maintenance, testing, upgrades, and other routine knowledge work – will be done overseas. But that leaves plenty for us to do. After all, before these Indian programmers have something to fabricate, maintain, test, or upgrade, that something first must be imagined and invented. And these creations must be explained to customers and marketed to suppliers and entered into the swirl of commerce in a fashion that people notice, all of which require aptitudes that are more difficult to outsource – imagination, empathy, and the ability to forge relationships. After a week in India, it seems clear that the white-collar jobs with any lasting potential in the US won’t be classically high tech. Instead, they’ll be high concept and high touch.

Adds Dana Blankenhorn:

Programming is rapidly being split into two separate disciplines. One is coding. The other is developing, by which I mean conceiving and designing new jobs that software might do.

Development, as opposed to programming, is a job of the imagination. It’s like the writing I am doing now. It is not a job that has a “price” or “value” on it. No Indian has my mind, nor my imagination, nor yours for that matter. We are all, each of us, irreplaceable in that sense.

Programming, on the other hand, is a learned skill, like any other. The market value of such a skill depends on supply and demand. If you can code 10 times faster than an Indian you’re worth 10 times their price.

There are many directions in which imagination can take us. We can create new programming tools that increase our efficiency. We can create new programs that do jobs no one has previously imagined.

That’s why The World of Always-On is so important. It’s a big new dream, a great new realm in which developers might ply their trade, creating enough work to keep all the Indian, American, Russian, and Chinese programmers in the world happily occupied for years to come.”

Outsourcing is good for India – but it will only provide a few million jobs at best. What’s also needed is for Indians to come up with innovations to raise the incomes of the rest of India – the 700 million in rural India. Only then will India will start to make the transition from an agricultural economy.

Tags: Emerging Markets

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