Offshoring in the core: Russian software firms onshoring in the USA

Offshoring and outsourcing have become the buzzwords of the IT community and the popular media discourse about the current era of globalization in services. Acknowledging the geographic perspective expressed in these dominant terms, in this article I examine the processes and activities that are oriented in the opposite direction. Capturing this inversion, I develop the concept of ‘onshoring’ and use research material from fieldwork conducted with IT firms in St Petersburg, Russia and their affiliates, agents and clients in the USA to provide an empirical case study. Onshoring encompasses the corporeal, representational, material and legal practices of offshore firms developing a presence onshore, with Russia as offshore and the USA as onshore in this case. The lack of an established Russian professional diaspora in the USA created a context in which developing a recognizable onshore presence was necessary for firms based in Russia. By explicitly recognizing that the efforts, risk‐taking and experimental strategies of offshore firms to create connections, networks and contacts onshore in the USA are a constitutive part of offshore outsourcing, I document and examine the less acknowledged complex flows and practices of onshoring. I argue that although these actors and processes may seem marginal to the widely recognized narrative of offshore outsourcing, in fact, they are creative and strategic compensations that reveal how the globalization of services is enacted at the micro‐level.     

The gap between career management expectations and reality – empirical insights from the IT industry

The Information Technology (IT) industry has become an important economic factor in many Western countries, but it is well known for suffering from skills shortages and high turnover rates. Organizational career management (OCM) may help to attract new talent and reduce IT turnover by satisfying individuals’ career needs. However, to date, little is known about what, exactly, IT professionals expect in terms of career-related support, and whether their expectations match with what IT organizations provide. This paper reports on a quantitative study that investigated what 1686 IT professionals in Switzerland, Germany and the UK expected and what their employers provided in terms of OCM. Findings indicate that there are substantial mismatches between OCM ‘supply’ and ‘demand’. The paper makes an important contribution by providing a more in-depth understanding of IT professionals’ OCM preferences, leading to various practical implications for IT organizations and beyond.     

Understanding cultural singularities of ‘Indianness’ in an intercultural business setting

Analysing data from the Indian information technology (IT) industry, this paper advances an understanding of cultural singularities of ‘Indianness’. The research context of an intercultural meeting place of IT and business process outsourcing firms’ overseas subsidiaries, Belgium in this case, allows the authors to identify 10 cultural singularities that typify ‘Indianness’. This ethnographic, reflexive study is further validated by employing Ghoshal's ‘smell of the place’ metaphor through the authors collective experiences as consultants and researchers, and builds and extends upon the popular cultural dimension frameworks for understanding intercultural business and management. Existing cultural dimensions do not sufficiently describe the contemporary intercultural dynamics that typically take place in workplaces, especially so in offshore and outsourcing environments. A provisional set of parameters for understanding Indian culture, with its relevant impact on business life (customs and manners), business processes and business deliverables are proposed in this study.     

"Meetings on the work": an analysis device for understanding the articulation between outsourcing and other organizational innovations

The purpose of this article is to discuss professional education and training programs offered to teams of operators by the main company in the area of Bacia de Campos (Petrobras), Rio de Janeiro, Brazil. It also discusses the necessary skills to the new functions derived from the implementation of an organizational innovation, the polyvalence, and how such innovation has impacted operators' activity. By using elements of WEA and the device "Meetings on the Work" it was possible to gain a better understanding of both the distance between the dimensions of prescribed work and real work, and the articulation between outsourcing and the proposition of polyvalence, which have stimulated the creation of new functions, namely, the polyvalent operator and the operator-maintainer, this latter being in fact an evolvement of the first.     

Competition in online job marketplaces: towards a global labour market for outsourcing services?

A new form of service outsourcing has emerged, namely the global online job marketplace for freelance contractors. Such platforms are currently the closest proxy to the idea of a global labour market where everyone competes for jobs regardless of location. In this article, we examine how competition manifests itself on one such global online platform, namely oDesk. We present a comparative analysis of the relative wages and the rewarding of skills and expertise of contractors from selected countries and investigate whether, via labour arbitrage, wage convergence takes place between Western and developing countries. We find that wage convergence is noticeable but experience and skills hardly translate into better remuneration. While service outsourcing (or microwork) via global online marketplaces provides new employment opportunities for freelancers around the world, the intense competition and the inherent restrictions of this type of marketplace limit the financial gains for most contractors.     

Value, knowledge, and the human equation:

conclusion As implied through the issues presented herein, firms must carefully align the value proposition of the IT function with that of the organization. We suggest that firms will increasingly migrate towards strategies and modes of operation that support the cus-tomization of products and services on a mass scale. A key ingredient in accomplish-ing this objective is the creation of an IT function that can deliver systems and technologies that are customized yet modular. Delivery of such systems depends largely on the adoption of processes and development of personnel who can rapidly adapt and configure IT to changes in business conditions. Failure to deliver these systems can result in unrealized corporate objectives and, in some cases, strategic drift.     

Do public relations professionals understand corporate governance issues well enough to advise companies on stakeholder relationship management?

The King Reports on Governance for South Africa are internationally respected for proposing integrated reporting in a triple bottom-line business context to improve corporate governance. The most recent report, King III, views stakeholder relationship management as a key tenet of corporate governance. This raises the question whether public relations professionals (PRPs) understand the principles of corporate governance well-enough to inform and guide organizations on the management of stakeholder relationships. The views of senior PRPs at selected top performing companies were elicited on their practice of stakeholder relationship management in line with corporate governance principles. It was found that their knowledge on corporate governance was limited, although they recognized its importance. They propose six role functions for managing stakeholder relationships on a strategic or managerial level; these role functions are aligned with the King III principles on stakeholder relationships. The following three were of particular importance: developing a corporate strategy, giving advice to senior management and managing crisis communication. Different terminologies were used to build relations with stakeholders and different approaches were used to profile stakeholders. It is recommended that organizations leverage their public relations functions on strategic and managerial levels in support of their corporate governance efforts. In turn, PRPs are encouraged to ensure a deep knowledge on corporate governance issues when counseling senior management on building stakeholder relationships.     

Why American business demands twenty-first century skills: an industry perspective

Public education is the key to individual and business prosperity. With a vested stake in education, educators, employers, parents, policymakers, and the public should question how this nation's public education system is faring. Knowing that recent international assessments have shown little or no gains in American students' achievement, the author asserts the clear need for change. As both a large American corporate employer and a provider of technology for schools, Dell is concerned with ensuring that youth will thrive in their adult lives. Changing workplace expectations lead to a new list of skills students will need to acquire before completing their schooling. Through technology, Dell supports schools in meeting educational goals, striving to supply students with the necessary skills, referred to as twenty-first century skills. The Partnership for 21st Century Skills, of which Dell is a member, has led an initiative to define what twenty-first century learning should entail. Through extensive research, the partnership has built a framework outlining twenty-first century skills: analytical thinking, communication, collaboration, global awareness, and technological and economic literacy. Dell and the partnership are working state by state to promote the integration of these skills into curricula, professional development for teachers, and classroom environments. The authors describe two current initiatives, one in Virginia, the other in Texas, which both use technology to help student learning. All stakeholders can take part in preparing young people to compete in the global economy. Educators and administrators, legislators, parents, and employers must play their role in helping students be ready for what the workforce and the world has in store for them.     

The Role of Technology on Young Adolescent Development: Implications for Policy, Research and Practice

This National Science Foundation funded qualitative study highlights unique features of adolescent technology use and its impact on the developmental maturational processes of early adolescence. One hundred twenty-eight 13- and 14-year-old students were interviewed about their information technology (IT) use. The most salient feature of the interview data is that the students perceived technology as integral to all aspects of their everyday life experience. In particular, they understood the necessity of using technology for the development of their cognitive/academic skills, and they spoke about the need to have technology skills for their future careers. They also seemed to understand how IT helped them develop psychosocially, especially in the areas of communication and relationship development. Throughout the interviews, these young adolescents expressed pleasure and pride in their self-reported high level of technoliteracy. Their voices can help expand our understanding of adolescent development in the digital age, and suggest implications for policy, practice, and research.     

Outsourcing and the Contracting of Responsibility*

Outsourcing is becoming an increasingly prevalent phenomenon not only in business life, but also in the affairs of governments and in the lives of individuals and families. But what exactly is outsourcing and what are its consequences? I will argue that outsourcing offers entities a set of freedoms (i.e., possibilities of action and non‐action) that are not considered possible in this practice’s absence. However, many of these freedoms are precarious in that they involve a multitude of risks and dangers both for those outsourcing their affairs and for those who take them on. Although there are multiple freedoms of this sort, one is focused upon here; how outsourcing allows entities to contract, in the sense of limiting, their responsibilities. Three specific ways in which outsourcing allows entities to do this are detailed. Recognizing this precarious aspect of the freedoms associated with outsourcing is important because it highlights the social risks involved in this practice.     

CORPORATE TAX INCIDENCE AND INEFFICIENCY WHEN CORPORATE AND NONCORPORATE GOODS ARE CLOSE SUBSTITUTES

An important deficiency in Harberger's [1962] model of corporate income taxation is its inability to consider both corporate and noncorporate production of the same good. Within-industry substitution has potentially major implications for both the excess burden and incidence of the corporate tax.
We analyze this within-industry substitution using a model in which each industry/sector contains corporate and noncorporate firms (with identical production functions) which produce goods that are close substitutes. The scope for considerable within-industry substitution of noncorporate for corporate capital leads to a very much larger excess burden than that in the Harberger model.     

Internship training in computer science: Exploring student satisfaction levels

The requirement of employability in the job market prompted universities to conduct internship training as part of their study plans. There is a need to train students on important academic and professional skills related to the workplace with an IT component. This article describes a statistical study that measures satisfaction levels among students in the faculty of Information Technology and Computer Science in Jordan. The objective of this study is to explore factors that influence student satisfaction with regards to enrolling in an internship training program. The study was conducted to gather student perceptions, opinions, preferences and satisfaction levels related to the program. Data were collected via a mixed method survey (surveys and interviews) from student-respondents. The survey collects demographic and background information from students, including their perception of faculty performance in the training poised to prepare them for the job market. Findings from this study show that students expect internship training to improve their professional and personal skills as well as to increase their workplace-related satisfaction. It is concluded that improving the internship training is crucial among the students as it is expected to enrich their experiences, knowledge and skills in the personal and professional life. It is also expected to increase their level of confidence when it comes to exploring their future job opportunities in the Jordanian market.     

OUTSOURCING AND UNIONIZATION: A TALE OF MISALLOCATED (RESISTANCE) RESOURCES

While many believe the growth in outsourcing contributed to the decline in U.S. unionization up to the 1990s, this argument has never been investigated systematically. In this article, we analyze the effect of outsourcing on unionization between 1973 and 1993. Instrumental variables estimation shows outsourcing contributes to higher quasirents and industry productivity. We find the union wage premium increases with the extent of outsourcing—both for workers that are substitutable by outsourcing services and workers in jobs that are not substitutes of the tasks being outsourced. Finally, we find no support for the claim that outsourcing reduces unionization. (JEL J5, L2, L6)     

Transatlantic Roundtable on High–skilled Migration and Sending Countries Issues

Globalization and the advent of the knowledge economy have created a new context where there is a greater demand for the highly skilled, especially in the information technology (IT) industry. High–skilled migration has become increasingly more complex, even if in recent years the term "brain drain" has become a generic reference to "high–skilled migration" of all types. It has also become clear that brain mobility does not automatically translate into "brain drain", and that impacts vary by the types of skills held by migrants.
The meeting demonstrated that while much is known about high–skilled migration and its effects on source countries, there is also a great deal yet to be learned in a dynamic environment. Many participants deplored the lack of reliable data, which makes it difficult to know what is really going on and to establish appropriate policies. Clearly, there are an array of policies that can offset possible adverse effects of skilled mobility and even leverage the flow into positive outcomes for source countries. A key element is improvement of the population's general level of education. Low levels of skills keep average labour productivity and wages low and therefore retard development. Long–term strategies to promote economic growth are needed to enable developing countries to retain and draw back their highly skilled and address the negative effects of the brain drain. Migrants themselves can play an important role through their remittances, diaspora networks, and own willingness to return – at least temporarily — to share their skills and contribute to economic progress. Finally, destination countries can facilitate the process through policies that promote circulation of highly skilled migrants.     

SERVICES OUTSOURCING AND INNOVATION: AN EMPIRICAL INVESTIGATION

We provide a comprehensive empirical analysis of the links between international services outsourcing, domestic outsourcing, profits, and innovation using plant‐level data. We find a positive effect of international outsourcing of services on innovative activity at the plant level. Such a positive effect can also be observed for domestic outsourcing, but the magnitude is smaller. We also find that international services outsourcing has a positive effect on profitability, as predicted by theory, whereas this is not true for domestic sourcing. The results are robust to various specifications and an instrumental variables analysis. (JEL F19, O31)     

Outsourcing human resource management: A comparison of Russian and U.S. practices

Our objective is to determine the current state of outsourcing of HRM functions at companies operating in Russia, both Russian and Russian-based foreign com-panies, and compare and contrast the results with the findings of the Society for Human Research Management (SHRM) study of outsourcing practices at American companies in the United States. The comparison reveals the differences and similarities in terms of reasons for outsourcing as well as the obstacles and problems in implementing HRM outsourcing decisions to a foreign setting.     

The uses and abuses of time: globalization and time arbitrage in India's outsourcing industries

Globalization has undoubtedly altered our conceptions and experience of time. It has sped up the pace of life and some scholars even suggest that a new temporal order is supplanting ‘natural’ and pre‐existing cycles and rhythms. Yet time is not dissolved in the global circuits of capital. Rather, globalization has brought about a complex mixture of temporal orientations; the workplaces of ‘new economy’, for example, are traversed by novel and retrograde modes of work pace, rhythm and time‐discipline. In this article, I explore the temporal implications of the outsourcing of information technology‐based service work to India. Drawing on fieldwork and interviews with workers, managers and executives in the Indian IT and Business Processing Outsourcing industries, I address the following questions: (1) How are corporations using time arbitrage to reap the full benefits of a globally dispersed labour pool? (2) What impacts are these temporal changes having on the health and social lives of Indian workers? For corporations, time arbitrage means increased efficiency and cost‐savings. But for workers, it results in long hours, an intense work pace, and temporal displacement. Night‐shift employees, such as call centre workers, are particularly vulnerable to such displacement, as manifested in health and safety problems and social alienation. Globalization therefore does not entail the loosening of temporal chains, but their reconfiguration: a combination both rigid and flexible that binds even as it liberates.     

Management consultants: systems development, power and the translation of problems

This paper aims to shed light on the exercise of power during the development and implementation of organisational information systems. Considering the use of Information Technology (IT) to help solve organisational problems, we employ the concept of the ‘sociology of translation’ to theorise the process by which the organisational problem is constituted and for which the appropriate IT solution is proposed. Discussing the nature of the power relationship between external management consultants in IT and client or user organisations, the paper considers the role of symbolic resources such as managerial discourse, and the differential access to IT knowledge and skills, as important aspects of power in that relationship.     

Outsourcing and union power

The outsourcing of union work and jobs either diffuses or diminishes union membership, depending on perspective and situation. The correlation of trends in union membership to trends in union power, while less than perfect, has until recently been relatively strong over the past sixteen years. The fact that as diverse a sample of unions as AFSCME, SEIU, and UAW have chosen to make outsourcing a prominent labor/public relations issue suggests that the correlation continues to be perceived by the union movement to be significant, notwithstanding the efforts of the “new” leadership of the AFL-CIO to break that link with respect to union political power by “taxing” member unions and their members to contribute both money and militancy to the 1996 election cycle. Although outsourcing may lead only to the diffusion of union membership either within or between unions, as opposed to the diminution of union membership, this fact has not received a great deal of attention. The net effect on total union membership of outsourcing from one union employer to another union employer is unclear, although the effect on the membership of the union at the outsourcing employer is not. The redistribution of membership within a union as a result of outsourcing is likely to have little immediate impact on union power. However, as even the best case scenario presented above suggests, it may have significant long-run deleterious effects on union bargaining power by taking labor out of a sheltered market and putting it into potentially competitive market. This is particularly likely to be the case when outsourcing (1) places the outsourced work into a different industry or wage contour and (2) creates the possibility of moving from sole-source to multiplesource supplier arrangements. The redistribution of membership between unions as a result of outsourcing is unlikely to have a major impact on union power broadly defined. It can have, however, serious deleterious effects in terms of the power of an individual union, as suggested in my “competitive case” scenario. The fact that one union’s losses due to outsourcing may be another union’s gain is of little consolation to the losing union. That act, in and of itself, may make the threat of outsourcing a potential union “Achilles heel” at the bargaining table by placing it into competition with some other, perhaps unknown, union as well as possibly nonunion competition. The most obvious threat to union power comes from outsourcing that diminishes union membership overall by transferring jobs from union to nonunion employers. The willingness and ability of employers to move work/jobs entirely out of the orbit of union control constitutes, in terms of power and particularly union bargaining power, a revisitation of the phenomenon of the “runaway shop.” It may also be viewed as a proactive form of hiring permanent replacements for (potentially) striking workers. The union options in dealing with such a challenge are to endeavor to preclude outsourcing through legislation or collective bargaining or to chase the work by organizing the unorganized, hopefully with the help of the unionized outsourcing employer. Neither option may be easy, but as the 1996 auto industry negotiations suggest, the former may be less difficult than the latter. The possibility that outsourcing from union to nonunion employer may provide unions with the power to organize from the top (outsourcer) down (outsourcee) cannot be entirely ignored as the issue of supplier “neutrality” reportedly was raised in the 1996 auto negotiations. The adverse effects of outsourcing on union political and financial power, by virtue of its impact on the level or distribution of union membership, can and may well be offset by an increase in union activism—as measured by dues levels, merger activity, organizing commitment, and political action. The adverse effects of outsourcing on union bargaining power are more problematical from the union standpoint. The effect of outsourcing, whatever its rationale or scenario, appears to be to put union labor back into competition. Thus, outsourcing constitutes yet another challenge to the labor movement in its ongoing and seemingly increasingly unsuccessful battle to take and keep U.S. union labor out of competition by proving itself able and willing to organize to the extent of the market and standardizing wages in that market.