Outsourcing IT employees

how to outsource

[nbozic]

Hi,

I'm just starting my own web development company. I realized that one could save a huge amount through outsourcing. I plan to outsource about 50% of all my employees, who would mostly be web programmers (ASP, PHP, HTML, SQL, Graphics,...).
I was wondering if any of you know the approximate hourly rates for offshore web developers, and if any of you know of any decent outsourcing agents (companies that provide you with trained offshore web developers).
Also, is it really worth to outsource? Are there too many negative experiences one can expect?

Thanks,

NB

[watercrazed]

I have mostly mixed results, mostly content not pure coding, outsourcing offshore and in country. Unless you have alot of money to throw at it and have several large projects I would go small and slow. If you know what you want and are picky start small, and with a number of persons or companies. Like a form that feeds a couple of fields to a database. Communicating by instant messaging and emails exclusively can be very time consuming and prone to error. Nail down a spec. format that works for you. Figure out how much and how often you want to review progress, how you communicate best etc..

Some new studies show that the savings are a lot less then anticipated. I am not surprised. Works best for generic tasks, but for those you might be able to pick up an off the self solution and tweak it for a similar price. Depending on your labor source and level of skill required hourly rates can be from $5 to $15 per hour and you will get project based rates that are less than that. I would never pay based on hours worked unless a long relationship had been developed.

[nbozic]

You're right, in many cases it may be difficult to communicate with the offshore employee. That was one thing I was afraid of... In some cases the employee hardly speaks any English... in which case it can be almost impossible to have him/her create the look and functionality you need. In that situation you'd just waste an enormous amount of time trying to explain the requirements, with little success.

Anybody else have an opinion? How about outsourcing agents?

NB

[Shuvi]

FYI- I'm looking for some freelance work in web development. Please let me know if that is something you might be interested.

Shuvi

[nbozic]

Shuvi, check you Sticky Mail / Personal Messages.

[zorick]

I have been on both sides of the outsourcing business - first coordinating outsourcing projects for German and Israel company and then establishing my own Ukrainian company.
I can say it is not trivial but it definitely worth trying.
The most convenient way is to find a company which does web development. They usually charge more then individuals, but they are more reliable and can help you bid for bigger and more complex projects when you grow. Anyway offshore company price will not exceed 15 per hour.
I do not offer our services because we are specializing on software development, not web. But once I outsourced quite heavy project to the company in Ukraine and they did an excellent job. They also invest in English training for their people so you will be able to communicate with them by voice.

Drop me your email or phone in private message and I will give you the details. Or I can ask him to contact you.

[danieljean]

I have been thinking about outsourcing lately. There are opportunities locally, but prices are insanely low. I think I can do a decent job of writing specifications, so outsourcing becomes a logical possibility. Most clients don't know what they want, or how to ask for it.

In fact, I would love to outsource open source software development. It'll piss off a lot of people at once, too :)

[DevMike]

Outsourcing is wrong.

Think about it 20 years down the road, when you want your children to be able to take advantage of the net, and profit/learn from it, and there is no way to compete because other countries do it for pennies per hour.

I know countless, smart, hard-working people that lose there jobs so shareholders/owners can save money. If you were forced to work for someone else, and they fired you to send your job overseas, how would you feel then? Next time you hire someone overseas, you are killing 1 job here, think about it, it seriously is the future of our country...the future of our children....

"Keep it in the family".

[danieljean]

DevMike- it's not so black and white!

I live in Halifax, NS. We sell services everywhere, and we're in competition with India to sell our services too. I'm considering outsourcing to make ends meet.

Yet there are odd feedback loops at play. As demand for IT workers goes up in some countries, their wages, naturally, go up. They'll train more workers, but more of them will start dealing with the needs of their country-folk.

That's the idea behind sending them open-source related work: they can use those same tools to meet their own needs. Less competition :)

There are some IT positions we can't outsource. Talking to a client, figuring out their exact requirements... that's best done face-to-face. There usually isn't a shortage of projects, and if you can re-use or shrink-wrap your product, there should be money to be made.

A couple other things make it hard for me to take seriously the "outsourcing is wrong" talk from IT workers.

First off, all the IT work I've done was asked for by companies so they could automate other people's jobs. Every time you automate a back-office task, you're helping a PHB layoff another person. Even an ecommerce store is a way to layoff people in a different retail channel.

Second, a lot of people are desperate for jobs in other countries because their economy is bad. And in the west, we've benefited for ages from their suffering. If we're not supporting fair trade, we're supporting slave labour. You like chocolate? Some of that cocoa is grown by young slaves. The conditions on tea plantations and coffee farms aren't always better. You have sweatshops in LA (we have them in Toronto too... migrant workers, a crying shame... I'm not just pointing a finger at you here).

Globalization is one hell of a beast. We'll have our share of pain. Most important, we need to figure out how to build a system that's not a constant race to the bottom. We'll need to consider those Indians part of our family too and work out a way for all of us to share in a prosperous economy.

Protectionism -trying to keep the benefits in our country- is not going to work anymore. I'm not saying I don't empathize- I do. I want you to make a decent living too. Let's just get more creative about our solutions.