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An Outsourcing Story

March 6th, 2004 · No Comments

It is not often that one reads stories about people one knows. So, when I read about ValiCert, I wasinterested. I happen to hhave known the co-founders. WSJ has a story on its outsourcing experiences to India:

When sales of their security software slowed in 2001, executives at ValiCert Inc. began laying off engineers in Silicon Valley to hire replacements in India for $7,000 a year.

ValiCert expected to save millions annually while cranking out new software for banks, insurers and government agencies. Senior Vice President David Jevans recalls optimistic predictions that the company would “cut the budget by half here and hire twice as many people there.” Colleagues would swap work across the globe every 12 hours, helping ValiCert “put more people on it and get it done sooner,” he says.

The reality was different. The Indian engineers, who knew little about ValiCert’s software or how it was used, omitted features Americans considered intuitive. U.S. programmers, accustomed to quick chats over cubicle walls, spent months writing detailed instructions for overseas assignments, delaying new products. Fear and distrust thrived as ValiCert’s finances deteriorated, and co-workers, 14 times zones apart, traded curt e-mails. In the fall of 2002, executives brought back to the U.S. a key project that had been assigned to India, irritating some Indian employees.

Tags: Software

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