Insourcing in the land of outsourcing

 

I always thought there was a certain irony in the fact that a project would be outsourced from a US company to its India operations to only then be outsourced by the India operations team to another outsourcing company in India. What do you mean even HP-India outsources? It used to make me chuckle. Until I moved here. Since living here, I have come to understand that outsourcing in India is not a buzzword or a business fad. It is a way of life: as natural as breathing or as essential as eating.

Let me give a few examples.

For the most part, I don’t do my own food shopping. My housekeeper does it. Why? Because I am too lazy to do it? No. Because, as one friend in finance has recently noted, the inherent cost of being an American expat in India is 333%, at least when it comes to tangerine prices, anyway. Sevrine usually shops daily to buy essentials. The other day, she noticed that we were out of eggs around 5:30 pm. She usually leaves around this time. Her solution was to call our dog walker who would be arriving about 30 minutes later to walk the dynamic duo. She asked him to pick up the eggs instead. He delivered the eggs as promised when he picked up the dogs. Brian had eggs for the next morning, Sevrine accomplished a task without lifting a finger, and Johnny made a decent tip, which I would have given any delivery person. Everyone was happy.

Eggs

Yes, you can get anything delivered here, even just a six-pack of eggs.

We have a dog walker come twice a day. Why? Because I was nervous about the street dogs when we first arrived and thought it would be a better idea to have a neutral third-party walk the dogs. I have gradually become more comfortable with walking them down the street a bit, but will only do so with Brian. Everyone once in while, Johnny’s brother, John (no idea why they have the same name), walks the dogs. While Johnny is keeping it all in the family, he is nevertheless outsourcing his job to his brother. How they work out the pay, I have no clue. But, it gets done. That is all that matters.

Typically, if you have a car and driver, then someone else washes the car. Why? I am not exactly sure. I think it is because the task is considered beneath the driver’s status. His job is to “move safely about the country” as it were, not get wet washing and drying the car. Recently, however, Jude has decided to insource the car washing task. It seems that Johnny is quite the outsourcing guru and was outsourcing the car washing and dog walking business to several other guys. But, his business seems to have grown too big too fast and to the detriment of his client’s (i.e., Jude’s) satisfaction. So, Jude decided to pull that task back in house and do it himself, citing speed and quality as contributing factors.

Speed and quality were also the reasons cited for Yahoo!’s recent reversal of its long-standing telecommuting policy. As a company, Yahoo! was once at the forefront of Internet innovation, but it seems to have somehow lost that edge. Observers have argued that it has become bogged down in execution without really thinking creatively and continuing to innovate. Just this week, Marissa Mayer was on Bloomberg talking about where the company is headed. Many have lambasted this decision as a fundamental betrayal of Yahoo!’s culture, which has traditionally supported working mothers like Mayer.

But, I fall on the other side of that debate and agree with Geoffrey Moore who argues that we are misunderstanding the intent here. This move is not about a step back for working women, but rather a step forward for Yahoo!. It is an attempt to recapture the creative energy it once had. As a former Creative Services Manager, I can tell you that capturing creativity is difficult to do over a T1 line. Those teams often function better when they are all physically present to feed off each other’s energy on highly creative projects. Sure, they can handle many daily tasks remotely, but when the big brochure comes down the pipeline, the team pulls together, innovates, and executes much better. Innovation not just execution is what Yahoo! needs to succeed. I certainly hope the policy is softened a bit, though. Telecommuting offers flexibility that a regular 9 to 5 job does not, and that flexibility is often worth more than higher pay. Not all tasks, however, are made for telecommuting, and not all employees have the discipline to perform well. However, many studies indicate that productivity improves in a telecommuting environment, but often at the expense of work-life balance.

Some have seen this move as a form of insourcing: bringing everyone back in house to get the job done, like in my car washing scenario. A reversal of a decades-long trend to outsource. But, the question is how long will it last, and more importantly, where will they all sit?

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