Tuesday, July 27, 2004

Is too much of a good thing, too much? -- Nope!

It's a new week at Finance Talk and they are featuring a new set of people. In the place of prominence is Pattboy from Patrick's Place. They are highlighting his journal entry titled "Calcutta, We have a Problem!" It discusses outsourcing and his suggestion for imposing sanctions via taxation on companies who send their jobs overseas. You're probably thinking, "Thank God!" They've finally moved on to someone else. Ah, but look closer. It's almost humorous. They ask down below Patrick's Image a poignant question that I'm sure all of you have been wondering - "What's next for Robbie?" I say it's humorous because it brought to mind the game, "Where's Waldo?" They are spotlighting my graduation entry this week. There's also another journaler, Platotang, being spotlighted for his job search efforts.

His journal isn't just about job hunting though. He talks about his philosopy on life and living in the D.C. area too. His new job has him moving to Philadelphia. It's another great journal out there that has received little attention. Stop by and say hi. Since he's moving to Philadelphia and doesn't know the area I referred him to Vince's journal. (I hope Vince doesn't mind.) To me that's just what you do. If you know someone who can help someone else, you step in and connect the two. As a matter of fact, I had the opportunity to do that last week when one of the women I work with needed someone to take care of her dogs. I referred her to Freeepeace. Freeepeace wanted to pay me a fee for referring her, which I turned down. I think hooking people up with complimenting needs is part of being a friend, and in this case a good journaler. It's also a great way to find a job. Two of the jobs I have had in my life were acquired because friend's told me about the positions. In addition, I have been able to hook friends up with jobs in other situations. 

The topic of the week is about outsourcing. The question is whether outsourcing will affect me? I feel fortunate because I really don't think it will. You might think I should be fearful because my field of study is Finance and many of the big finance companies are sending their back office jobs overseas.  However, I don't work in the Finance industry anymore. I actually work for a corporation in their accounting department. It's not a big name company and their operations are rather small. Not everyone is so fortunate when it comes to globalization though. They are losing jobs that are being sent overseas. I feel for them but from an economical and even humanitarian point of view, I do support globalization. I touched on the subject a while back in my entry "The New Telemarketer."  I was actually surprised they didn't highlight that entry instead. So I thought I'd link to it because it is essentially in opposition to Patrick's point of view. Although, I did present it in a humorous slant it's obvious that I don't agree with Patrick. However, I do respect his opinion and he brought up some valid points.

The two biggest complaints of companies sending jobs overseas, besides the obvious complaint of job loss, is that companies do so in order to save money by paying people substandard wages and that customer service has been severely impeded when the person on the other end of the line doesn't speak English as their primary language. However, I believe with minimal intervention the market will work out the issues. I say minimal because I think some government regulation on big business is always necessary. Otherwise, greed tends to corrupt and given the opportunity companies generally will not do the right thing. It's why we have environmental and labor laws. As a consumer, we have a responsibility in the market as well. If you know of a company that is acting unethically you should not turn a blind eye. The market is large enough that there are others who will provide you the service you demand. 

Taxing companies to force them to stay in the United States will cause prices to rise. Companies outside the U.S. will be able to provide products and services cheaper than their domestic counterparts. Having a larger market to sell your goods encourages economies of scale. It becomes cheaper to produce a million widgets as opposed to only a few thousand. There are some jobs that just can't be sent overseas for practical reasons. In addition, sometimes it's just makes economical sense to manufacture items locally as opposed to half-way across the globe.  The short-term ramifications does mean a shift to the job force and that's where affordable education becomes the issue. However, that's best left for another entry.

The other point Patrick brought up is the difficulty understanding someone from Calcutta. My recommendation is patience and using your own voice. Often times, it's just a matter of listening. If you carry on conversations with people who have an accent often and long enough, you begin to understand rather easily what they are saying. It's no different then someone from the North conversing with someone who has a thick Southern drawl. You wouldn't expect someone in this country to sound exactly like you so why expect it from anyone else. Consider the opportunity that you have to speak with someone from another part of the world, to expand your horizons. As I mentioned in my previous entry, I find people from India tend to be some of the most hospitable and gracious people I have ever met. It only seems logical that they would make great customer service people. Of course, that won't last long if they see Americans as rude and obnoxious because of their dealing with us. You are representing yourself and your country to the world conduct yourself worthy of that honor and treat the person on the other end of the line with respect. If you still find you have a problem then politely tell them so. Request to speak with someone else. Don't be rude about it, just explain your need and I bet they'd be happy enough to accomodate you.

Another quick point since this has turned into a rather long entry, a while back I read an article that some of this outsourcing has actually begun to create jobs back here in the U. S. Companies that operate service centers overseas have found the need to establish a presence here in the U.S. in order to best serve their clients here.  I haven't adequately addressed all of the issues of globalization. But, I hope what little I have brought up will encourage people to investigate the issue for themselves and realize that there are always two sides to every coin.


deabvt said...

Wtg, Patrick, Robbie!
Thanks for the info, robbie!

mlraminiak said...

Wow!  Long entry, and I have a lot to say about it...

I have mixed feelings about outsourcing, and wish I understood it better, and had a better grasp of our options.  My husband works in an industry that has been devastated by "globalization."  He works for a decorative pillow manufacturer.  Five years ago, most of their purchasing was done from textile mills in the southeast, and the products were manufactured here in Portland.  Now, at least 70% of their business is running imports from China and India.  That is what the marketplace is demanding, and that is what they have had to do.  They've basically gone from being a manufacturing plant to being an import company.  Do barely enough "manufacturing" anymore to keep a crew employed.  I can't imagine that any of the production people are making a decent living wage anymore, with all they layoffs that go on when production is down.  AND a huge number of the textile mills in the southeast have closed down and put MANY people out of work there.

Also, the pressure of the "Walmart" school of retail buying has made it so that my husband's company is practically giving product away.  Their profit margin has all but evaporated.  They were shoved headlong into an industry they didn't understand---importing---and have no expertise at.  Sort of making it up as they go along.  And they're sucking at it, because the sales people and the buyers can't seem to understand the time frame for acquiring the product they ordered is lengthened by at least the nine weeks that the product is gonna spend on a boat getting here.  It's a mess, and my husband is getting an ulcer over it.  But if he loses his job, and I believe there IS a more than passing chance of this happening---we are REALLY in a mess!

mlraminiak said...

Hey!  I'm not done yet!  

I don't think Patrick's comments about not being able to understand Indian-accented English are very valid.  I could listen to that cadence all day...I think they speak beautifully!  And English is NOT their second language.  Most English speaking Indians are at least bi-lingual.  A concept not well understood here in America....  Lisa  :-]

babyshark28 said...

Well, robbie, too bad your not being paid by aol everytime your featured somewhere. :p
It's nice of you to share the spot light with someone. your sweet!
Take care busy lady. :)

readmereadyou said...

I have been to his journal. I'm sure he appreciates the reco. : )

dmt66frd said...

Ah ... outsourcing! Another major issue I'm still wrestling with these days. You have a natural talent for finding them my friend :-).

In the field of medicine, this hasn't hit full force yet, but that's only a matter of time. All the documents that must be transcribed can be sent over to India and done much cheaper for the hospitals and doctor's offices involved. Other changes are occurring too. For instance, in a select few places, they've begun sending their digital images MRIs and CAT scans overseas to be interpreted. True, these were sent to doctors overseas who were licensed to practice in the US, but it still sets the pattern for things to come. The same approach can be applied to other areas of medicine as well. I can easily see the day when you can go online and get medical advice and prescriptions from overseas. Outsourced medicine! It's partially there now in fact, but not yet cohesively organized to displace the doctors here. That may change. It will be cheaper too, but is it wise?

I worry about what will happen when we have lost most of our industrial base, and a good chunk of the service sector besides. While it's true that some of this loss is inevitable, or can be made up by other means, a wise country will set up their laws to make it economically more attractive for businesses and capital to stay within its borders, and we aren't doing that.  I've heard the arguments on both sides. I just need more information to go on before I can draw better conclusions.

dymphna103 said...

Very excellent entry.  Your right about jobs going overseas.  I have a hard time seeing a change though.  I do hope for it...john

ggal3133 said...

Excellent entry, you say it so well!
Congrats on being featured again :)

lamove04 said...

In a real sense, the filmmaking industry is dealing with outsourcing too. Productions have moved to Canada and around the world due to cheaper labor costs.  Toronto or Vancouver stand in for SF, so way fewer films are shot here. You always hear of celebs shooting in Eastern Europe, etc.  Producers and directors have to fight to have their films shot in the US. (last year's "Mystic River" was an example where the Clint Eastwood absolutely required that the film be shot in Boston, and you can tell).

I believe that all of us on this planet are connected, I don't have a problem with some aspects of outsourcing, but others bother me.  I've spoken to some Indian Tech people who are downright rude.  Their English is ok, but some have had zero patience for questions.  I read an article about how surreal life is for them at their jobs-- they often use fake Americanized names, they work in the middle of the night, etc...

just some random reactions...  Albert

barebytes said...

Is too much of a good thing too much? Are you serious? You never have too much of a good thing. Think about it, in life you hardly ever get a good thing to begin with, so if you finally get a good thing, use that sucker till it drys up. hahaha I know the mind can take that in many different directions but keep it clean here hahaha Just go with the flow. Hugs Lanny

quroboros said...

I think it's reprehensible that outsourcing is so common now.  But it seems we're going to get screwed no matter what.  As you said, if these companies are subjected to penalizing taxes, they'll simply pass that on to the consumer.  Personally I don't accept it as the 'cost of doing business' and think that all that cash is going into the pockets of a very few corporate masterminds.  ¤Holly

miarenee24 said...

This was a excellent article, Robbie!

(Gee..I've really missed out on a lot since my last visit!) still reading.... I can't come to your journal and just read one entry. I have to read every, single one till I find myself where I left off last time! :P

musenla said...

Interesting that you wrote about this since I am planning to write about it in depth in a future entry.  

As you know, you and I have a background in economics, so I understand the economies of scale you were referring to.  There is also the important issue of international trade.  As more people overseas receive better wages, the more demand there is for our goods, which in turn reduces our trade deficit.

Economics today is no longer just national, it's global.  There is no stopping this.  We have to consign ourselves to the fact that the marketplace has expanded to include the whole world.

However, there is no denying that abuses abound in outsourcing, especially in the area of fair wages.  There should be fair trade regulations, and I tend to agree with Patrick, there should be checks and balances to make sure that our workers don't suffer in big businesses' quest for bigger profit margins.  If that should be in the form of taxes and penalties so be it.  Think of it as a reverse tariff.