I have lived in the US for the past two years and prior to that have worked at various companies all of which were in the software development bussiness, mostly outsourced software development or off shore development as one might call it. Basically the term I prefer for this is cheap labor. Any company, you name it and I can bet the reason for an expanded Indian office catering clients far away, is cheap labor. At nearly 1/10th the original cost and for doing the same work. I know none of this is a news to most of you readers. Then what am I writing about?

It is a question, a question that I have asked people a lot times and answers have been varied. My own answer to this is not very pleasing to many around me. So, today I try to pose it to you all, my readers (in whatever short numbers you are, you are valuable).

It is about the outsourcing and relates the notion of pricing the product to the current market standards. If the demand is bigger than supply then price is up if the opposite then it is low. So, in this context how would you put the equation of outsourcing? Not a brain teaser, I suppose. India and China have large number of human resources, for one they don’t have one thing in scarcity and that is humans. In case of India engineers and scientist. There is a flood of them, thousands and millions graduating every 5 years. They are being added to the pool with similar skill sets, similar aspirations,similar desire to earn big bucks in small time. Now when you have this heavy flow of “Talent” (?) and that too at the 1/10 of the price, WHY WILL SOMEONE PAY THE SAME 10 TIMES HIGH PRICE?? Now come the grand question.

“IS THE JOB REALLY WORTH THE ORIGINAL PRICE WHEN THE SAME JOB CAN BE DONE IN LOWER 1/10th PRICE?”

Will the workers in the US settle for 1/10 of their salary because their job can be done at a much lower price. In fact let me put this with an example, will you buy a “shampoo” (please replace it with any product you like) from a store that employs expensive sales workers for $10 more than the lower price at Walmart or Target for the same brand and product? Whatever is your answer I would like to know.

I have the Indian side of out sourcing too, I will write about it soon. It is an employee’s experience. Till then keep your views on this one coming.