| "> | | | | So, the total actual cost of the worker would be |
| The Cost Advantages of Outsourcing Are | | | | $82,000 per annum; a 58 percent increase on the |
| Overstated | | | | initial estimate. |
| With employees in offshore locations such as the | | | | There are Massive Cultural Barriers |
| Philippines and India commanding only 10 percent to | | | | The initial step involves making a comparison of |
| 30 percent of the wages that United States workers | | | | potential offshore countries. It is certainly no accident |
| earn (with the average Information Technology staff | | | | that 260 of Fortune 1000 organizations have chosen |
| costs ranging from between $5,700 to $6,400), there | | | | India as their country of choice for outsourcing. |
| is absolutely no doubt that savings can be obtained | | | | Indians are known to have very excellent English |
| merely from a head-count perspective. Although, the | | | | language skills and also very well trained technical |
| best advantage of outsourcing is the migration from | | | | workforce all thanks to their world-class educational |
| an operating cost information technology | | | | system. The second step that you need to take is |
| environment to a variable pricing model that will allow | | | | to make sure that the outsourcing company you |
| companies to gain much better control over | | | | choose has in place a stateside project management |
| operating costs. There will of course be a reduced | | | | team who can engage both you and the offshore |
| need for hardware and software infrastructure, as | | | | resources. A really good project manager will facilitate |
| well as reduced costs for upgrading and maintaining | | | | communication and also help to clearly define and |
| software and hardware and for training software | | | | track objectives and goals. |
| developers on the newest technologies. | | | | Do not even think about it! America is not the only |
| It is a Buyer's Market for Information Technology | | | | country that offers its citizens wonderful educational |
| Workers Right Now Anyhow | | | | opportunities. Agreed, India is one of the many |
| A lot of companies underrate the real cost of hiring | | | | developing countries in the world, but this does not |
| an in-house employee. Employing a worker with a | | | | mean that this country lacks a great educational |
| base salary of $55,000, the following additional costs | | | | system. There are lots of Indians that speak |
| should of course be expected: | | | | impeccable English and a lot of these graduates |
| Benefits - dental, medical, 401(k) plan: $17,500 | | | | speak without accents that would give away their |
| Admin costs: $8,000 | | | | nationality. |
| Orientation/training costs: $1,500 | | | | |