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Exploring
the human side of offshoring
Before he visited India, John
Pinkard, ’06MBA, shared with many other Americans a similar
attitude toward the practice of offshoring work to Indian companies: he
didn’t like it very much.
“I was very negative, I had the American mentality of ‘Oh Gosh,
we’re losing all these jobs,’ ” says Pinkard. He is from
Martinsville, Va., where foreign competition in textiles and lumber has
contributed to 16 percent unemployment.
But after spending eighteen days in India during Lead Week and visiting
several leading offshoring companies, Pinkard says his opinion of offshoring
has changed.
“I saw how eager people were to be of service, how eager they were
to earn profits. It’s how I assume the United States was 100 years
ago, with people really taking advantage of opportunity and wanting to
make a new life for themselves.
“And it really changed my attitude about one day—as a manager—possibly
giving work to people overseas. It opened my mind to thinking of work
as part of a global community instead of Americans versus Indians.”
Student Lead Sudipto Banerjee ’05MBA,
notes the objective of this portion of the trip was to expose students
to a wide range of cutting-edge Indian companies, including several, like
Mphasis, Wipro, and Infosys, that are leading players in offshoring functions
such as call centers and back office processing.
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|
Lead week trip organizers, left, Sudipto Banerjee ‘05MBA, and Goizueta faculty members, far right, Reshma H. Shah and Kenneth Cutshaw, meet with Sona Khan, center, a prominent Supreme Court attorney in India. (Photo courtesy of Will Davidson) |
Thanks to the connections of Faculty Lead and Program
Director Reshma Shah, assistant professor
in the practice of marketing, the students met with sixteen CEOs and members
of the powerful Tata, Ambani, and Birla families. In addition, they received
a private face-to-face audience with the president of India. “Our
goal was to introduce our students to the best and brightest minds in
India, who are quickly becoming recognized as world-class business people,”
says Shah. “India has the potential to become a major global player
and due to its emphasis in intellectual capital, can be a role model for
leadership and management best practices.”
“This lead week was successful in immersing the students into the
business and cultural environment of India,” notes Ken
Cutshaw, an adjunct professor at Goizueta and co-leader of
the group. “Not only did they meet the CEOs of businesses, but the
ministers of the Central Government and the President of India. This is
significant because government leaders develop the policy that impacts
the business community and the daily lives of the Indian citizen.”
Banerjee, one of a dozen students of Indian background on the trip, noted
two trends. Indian firms are rapidly moving toward offering more value-added
services like pharmaceutical R&D and consulting and are “not
just people answering the telephone.” In addition, rapidly growing
Indian companies are outsourcing many of their functions to the same Indian
firms serving U.S. and European clients.
Heather Wilson ’98MBA has firsthand
experience assigning work to Indian companies and wanted to meet the people
with whom she had been dealing.
“For me, the benefits of Indian services are lower costs and often
a quicker turnaround. I’m able to get more done with fewer resources.
I was very impressed by their people, locations, and technologies.”
Wilson was astounded by Indian demographics. “Sixty-five percent
of their population is under age 35, about 50 percent is under 25. Their
demographics are the inverse of America. Sheer numbers will help them
keep costs down.”
Nearly all the firms visited during the Lead Week module operated in a
very American style, the students noticed, with a culture that values
teamwork highly. Nearly everyone spoke English, which made interaction
easy; and with the Indian education system emphasizing math, science,
and engineering, it was easy for students to understand India’s ability
to develop significant capabilities for offshoring.
Although India is posting eye-popping economic growth numbers—a predicted
7 percent in 2005—Wilson says it was apparent the country was being
held back by substandard physical infrastructure and government restrictions
of direct foreign investment in certain sectors.
But with the demographic boom, strong technology skills, and low costs,
the Indian offshoring advantage isn’t going away soon.
Says Pinkard, “As Americans, I think we tend to believe we do everything
the best, but I think it would be good to study what is making India such
a strong player in the global market.”
Has Pinkard talked to his dad, who is in the lumber industry, about this
new attitude toward offshoring?
“No. Since he hasn’t had the experience of going to India, I’m
not sure he would agree with me. I think if you view yourself as a world
player, it’s not hard to talk about offshoring. If you limit your
view to only what goes on in America, it is harder to think about.
—David Black