To remain competitive, companies like mine must procure resources as inexpensively as possible. In many cases, this means moving at least some components of the software development cycle overseas, where costs are significantly lower.
I think everyone will agree that offshoring is a politically volatile subject. And for good reason. We all want decent jobs for everyone. Period.
Instead of ‘offshoring, I prefer to call our continual worldwide search for talent something more benign, like ‘globalization.’ As a business owner, I must continually strive to build an organization that is sustainable and scalable. It would be dangerously provincial for me to limit my talent search locally.
Critics are quick to dismiss my position. But I find their arguments simplistic and ignorant.
I can hire highly skilled programmers locally, but are you willing to pay for the increased costs?
And what about all those other areas of our day-to-day lives? Don’t they deserve equal scrutiny? Your smart phones, for example, are surely manufactured in a developing country.
And those shopping items from Walmart? Most come from China.
The fact is our world is more interconnected than ever. Just take a look at me: My mom is German. My father, an American, is MIA in the Vietnam War. My wife is Russian, my TV is Korean and my car is Japanese. The Japanese car, by the way, was manufactured in the United States.
These days it is so difficult and unfair to tell “us” from “them”.
But there’s another more fundamental issue to think about: We may come from different countries, but in the end we are all the same family. And what’s good for someone on the other side of the world is ultimately good for me, too.
Studies show when you boost a developing country’s per capita income, great things start to happen. Balanced growth brings sanitation systems, schools, potable water systems and reliable energy sources. Families are lifted out of poverty and human rights improve. It’s win/win for everyone, including us. Read more: http://goo.gl/nd0o0
We starting building a global network of software geeks more than 3 years ago. We first turned to freelance sites like eLance.com, oDesk.com and Freelancer.com to find talent. Those sites are useful and potentially very effective. But finding a solid team can be a challenge. Aside from competency issues, there are language barriers, cultural differences and time zones to overcome.
We used to eLance to find the right geek and essentially dated for a while before getting married. Basically, we gave him increasingly larger projects to assess whether he would be a good fit. Once we were confident he was the right person, we hired a team of programmers under his leadership. He now heads the group and serves as our Chief Technical Officer for SuperGeeks.biz, where he is responsible for managing projects from web design and e-commerce sites to software development and mobile app development.
In Bangladesh, we can hire an MIT caliber coder for 1/10th the cost of his American peer. And that’s assuming we could even hire the American! With larger, deep-pocketed like Facebook and Google romancing the same American candidate, it’s tough for smaller companies like mine to get his/her attention.
For now, basing our software development team in Bangladesh is a huge success. But the cost advantages will surely change over time. Disney now has a team of 100 developers in Dhaka and Google and Microsoft are conducting interviews at the university. Everyone wants the same talent. That means wages in surely increase.
So what’s it like in Bangladesh? BD is one of the poorest countries in the world. It’s also one of the most densely populated. But the country has tremendous potential. It’s citizens are educated, they speak English well, the government is stable and the country is young. Commerce is thriving.
The statistics:
- Bangladesh exports $19B per year.
- 80% of exports are ready-made garments (RMG)
- RMG market employs 3.5M semi-literate, semi-skilled workers
- 80% of workers in RMG market are female from rural areas
- Tariff rate USA places on Bangladesh RMG goods: 14-15%
- Wikipedia entry on Bangladesh: http://goo.gl/Vp6vp
- CIA’s entry on Bangladesh: http://goo.gl/8KNFw
The good:
- The IT industry in Bangladesh is booming: http://goo.gl/R1dva
- Here’s the Disney project: http://goo.gl/XZnTe
- Bangladesh will soon open the 3rd largest shopping mall in the world: http://goo.gl/sgQD7
- Garment manufacturing is huge: 350+ apparel factories on outskirts of Dhaka
The bad:
- Bangladesh is the 5th most disaster-prone country in the world (World Economic Forum)
- Meager wages and unfriendly working conditions
- Frequent power outages and failure of basic human services
