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  • From: "Michael D. Thomas" <mdthomas AT mindspring.com>
  • To: "Internetworkers: http://www.ibiblio.org/internetworkers/" <internetworkers AT lists.ibiblio.org>
  • Subject: Re: [internetworkers] textile workers of the future?
  • Date: Sat, 5 Apr 2003 13:38:33 -0500


----- Original Message -----
From: "Michael Winslow Czeiszperger" <michael AT czeiszperger.org>
> > "No offense, guys," Holcomb told his co-founders, "but programmers are
> > the
> > textile workers of the future."
> >
> > in Tech jobs leave area, go overseas
> > http://www.newsobserver.com/front/digest/story/2407498p-2241912c.html
> >
>
> Unfortunately the article is only too true. The writing is on the
> wall-- the US is no longer the only place where most software will be
> written. Not only are US companies outsourcing programming overseas,
> but entire companies are forming overseas that will compete with the US
> companies that are left.

I see this as two different trends:

1) Software company OutsourcerSoft outsources the 'coding' part of product
development to another corporation that has coders overseas;
2) Overseas software company OverseasSoft is an overseas corporation competing
with American companies;

And then you also have:

3) AmericanSoft is an American company with a core American staff. A
derivation of AmericanSoft is GlobalAmericanSoft, such as Sun, that has
development offices overseas.

I consider OutsourcerSoft and OverseasSoft to be radically different cases.
But first...

Why don't we compare the American software industry with the American
automobile industry? I see a lot of similarities. American automakers were
dominant in post-WWII times because they were close to the world's largest
market, had more experience, infrastructure, etc. Nowadays, you are warned not
to buy G.M. cars because they are of poor quality... and what is the big knock
on America's flagship software company, Microsoft? Quality.

The comparison is complicated, since an 'American' car may be almost wholly
made in Asia, and a 'Japanese' car may be largely made in America. But I
expect that the software industry will go such a route overtime. At the end of
the day, it is the companies that care about providing a quality product that
will succeed.

Before going too deeply into the analogy, it's important to remember that an
automobile and a piece of software are very different. The difference in the
cost structures between the auto industry and the software industry is most
salient to this discussion. First, consider that any particular automobile is
a replication of a design. When you go down and buy an automobile, most of the
cost is for the physical pieces -- the steel, the doors, the leather chairs,
the engine, etc. You are also paying for the labor of assembly and the R&D.

In software, you aren't paying for the physical parts because there are no
physical components of software! You may pay for the CD that the software came
on, but in a lot of cases you just download the software. There isn't any
assembly or an assembly line. Whereas a new car is a replication of the design
for the model, software replicates on download. As such, the majority of the
cost of software is for the R&D, whereas for an automobile that is a
relatively small cost.

Any analogy between the software industry and the automobile industry must
reasonably stop at the auto industry's R&D and engineering departments, before
the assembly line. Unfortunately, the assembly line -- i.e., offshore auto
worker vs. offshore programmer -- is usually where the analogy starts.

...and then open source comes along and blows any such analogy out of the
water, especially in the horizontal markets (OSes, dev. tools, datastores,
etc.)

Anyway, the different types of software companies -- OutsourcerSoft,
OverseasSoft, and AmericaSoft -- will compete on a global stage. For us
American developers, OverseasSoft is a huge threat. But there are still
opportunities for software technologists. While American autoworkers were
losing their jobs, the number of mechanics and auto sales people has continued
to increase with the number of cars on American roads.

Our different software companies will compete on the usual criteria: cost,
quality, availability, and attractiveness of the sales people. It's very
likely that AmericaSoft will be at a disadvantage out of arrogance. That's one
lesson to learn from the American auto industry. But at the same time,
software development is both hard and strange. A lot of the lessons of
large-scale software development seem only to be learned through experience,
and that's an advantage AmericaSoft has over OverseasSoft. (But it could be
that foreigners in management and architect roles might be more prone to
actually read the history and lessons of software development.)

Now OutsourcerSoft.... OutsourcerSoft strikes a nerve because OutsourcerSoft
hires people 'over there' instead of people 'here.' But I think the real
limitation is the outsourcing relationship. A project is divided across two
corporate entities that don't necessarily have congruent objectives. These big
software projects are tough even when everyone is ostensibly on the same
team. Putting a moat between parts of the team doesn't diminish the challenges
of software development.

My hypothesis is that OutsourcerSoft is limited to Waterfall/RUP style
development. I.e., XP and Agile methodologies simply wouldn't work. RUP isn't
best for all types of projects. While it's great for your inventorying
systems, it isn't so great for your word processors or NextBigThing
technologies. RUP is also tough when requirements are changing or there are
too many technology unknowns.

It's not that outsourcing overseas can't work, it's that you are limited by
the methodologies that must be used to create a quality product. Thus, if you
are outsourcing when your project should really be developed using the XP
methodology, you are probably headed for trouble. You'll be in trouble even if
you are outsourcing to a company a couple doors down in the same building.

















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