Gates, Scott ([log in to unmask]) wrote: : : At one time, the unemployment hotline in New Jersey was answered in India. : There is something VERY twisted about being told to "Get a Job!" by : someone who makes less than the state pays in unemployment benefits. : Luckily, the NJ state legislature agreed, ordering the NJ Job Line to mend : its ways. : Forty states have their welfare hotlines answered in India, by awarding contracts to eFunds and Citicorp. And it's only going to get worse... http://www.businessweek.com/bwdaily/dnflash/dec2003/nf20031215_8942_db046.htm BW Online | December 15, 2003 | Corporate America's Silent Partner: India "COMMENTARY By Pete Engardio Corporate America's Silent Partner: India Businesses are off-shoring more and more white-collar jobs there, though you won't hear them talk about it much in an election year The shift of skilled work to India is becoming one of Corporate America's worst-kept secrets. Almost daily, India's newspapers carry items on new plans by U.S. software, finance, or pharmaceutical companies to open or expand call centers and research labs. Officials from Bombay to Bangalore point to splashy new office parks that are soon to house major facilities by companies like Morgan Stanley (MWD ), General Motors (GM ), or Dell (DELL ). Tour a busy call center run by an Indian outsourcing specialist at midnight, and you'll likely see hundreds of staffers fielding calls for clients like American Express (AXP ), MetLife (MET ), J.P. Morgan Chase, or Citigroup (C ). Yet it's still very hard to get these companies to talk in the U.S. about the increasingly important role India is playing in their business models. For BusinessWeek's Dec. 8 cover story, "The Rise of India," only a few BW 1,000 corporations were brave enough to grant on-the-record interviews about their R&D and back-office operations. They included General Electric (GE ), Intel (INTC ), and Cummins (CMI). A number of small software, chip-design, and e-commerce startups, for whom the ability to tap global brainpower is regarded as a competitive edge, also cooperated. But dozens of America's biggest investors in India -- don't worry, I won't name names -- simply refused to talk. SPEAKING UP. Few topics are as radioactive as offshore outsourcing. In the current political climate, politicians, pundits, and angry laid-off workers are hunting for scapegoats for America's largely jobless recovery. You can't find better targets than China and India, both of whom undeniably are gaining from the sweeping restructuring of American technology, financial services, and telecom companies. Companies from AT&T Wireless (AWE ) to Bank of America (BAC ) are issuing pink slips at home while staffing up in Delhi, Bombay, and Hyderabad. Corporate America won't be able to stay silent forever, though. Globalization of white-collar work is an irreversible mega-trend that's only starting to hit full force. The massive facilities being built in India under the radar screen will soon be blindingly obvious. More important, the economic payoff of off-shoring business processes and a portion of R&D can be so enormous that even reluctant corporations will have little choice but to follow suit to stay competitive. If a major info-tech, insurance, telecom, or banking company doesn't disclose any back-office center in India, Wall Street will soon start asking, "Why not?" Why am I so sure? Partly because of what has happened in electronics manufacturing over the past decade. From 1990 through 1996, I covered East Asia from Hong Kong. When I first visited Taiwan in the early 1990s, all of the computer makers there were manufacturing, and in some cases designing, desktop and notebook PCs for U.S. giants like Gateway (GTW ), Dell, IBM (IBM ), and Compaq, as well as many Japanese clients. "GLOBAL VALUE CHAIN." This was all supposed to be a big secret, and when asked, few U.S. companies would acknowledge that any of their PCs were made in Taiwan. When I returned to the U.S. in 1997, only a few tech companies, such as Cisco (CSCO ), Palm (PALM ), and Hewlett-Packard (HPQ ), openly outsourced production of equipment to big U.S. contract manufacturers like Solectron (SLR ), Flextronics (FLEX ), Celestica (CLS ), and SCI, while most other tech companies remained hush-hush. By the end of the '90s, though, outsourcing had become the accepted model in electronics manufacturing. Wall Street assigned much higher stock values to companies that outsourced, and they had far healthier returns on capital. Companies that were slow to sell off their own factories, such as Motorola (MOT ) and Lucent (LU ), were heavily criticized. In fact, companies began to tout their strategies for building a "global value chain" by joining forces with manufacturing and design "partners." And when it came to Silicon Valley, venture capitalists simply wouldn't back a new telecom-equipment company, say, if it planned to build its own factories. LOBBYING CONGRESS. I suspect companies will be more open about white-collar off-shoring not long after next year's U.S. Presidential election. By then, foment in Washington for protectionist policies will likely abate. If, on the other hand, the economy falters and the political backlash intensifies beyond 2004, Congress might introduce legislation to curtail off-shoring. Then Corporate America would have another reason to step forward. CEOs will become more vocal in lobbying Congress -- much as companies like Boeing (BA ) have carried the water for China on Capitol Hill every time Washington considers restricting trade..." --Jerry Leslie Note: [log in to unmask] is invalid for email * To join/leave the list, search archives, change list settings, * * etc., please visit http://raven.utc.edu/archives/hp3000-l.html *