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Lakota Technologies and American Indian IT Outsourcing

By Tom Field

October 01, 2001 — CIO — The eagles take flight, and the CEO’s hopes soar with them.

Two, six, a dozen eagles?they’re everywhere in the skies above U.S. Highway 212 in rural Ziebach County, S.D., smack in the middle of the Cheyenne River Sioux Indian Reservation. JD Williams, the plainspoken, denim-clad CEO of Lakota Technologies Inc. (LTI), is giving a windshield tour of the reservation, and he’s absolutely awestruck by the eagles. A Sioux native of the rez, as it’s called, Williams has never in his 45 years seen so many eagles on a single day. "It’s a sign to Indians, you know," Williams says as one eagle takes flight with a wingspan that could envelope his Chevy Blazer. "When you see an eagle soar like that, it’s a sign of good luck, of prosperity to come."

To Williams, the eagles represent dreams?not just for LTI, his startup enterprise, but also for his impoverished people. Williams’s dream is to bring the offshore outsourcing model onshore (see "Outsourced in America," Page 86)?to convince companies to send LTI the same data-entry, call center and document-imaging jobs they’re currently sending overseas to India and the Philippines.

He has a good argument: Overhead costs are low and labor potential is high

on the rez in Eagle Butte, where even those low-level IT services jobs could mean a huge bump in the standard of living. Rates vary by contract and customer, of course, but it’s fair to say that if U.S. companies are paying their IT employees $40 to $80 per hour for baseline IT services, and offshore companies are charging $15 to $30 per hour, then LTI fits somewhere in the middle, offering solid value without the communication and management headaches that come with offshore projects.

But Williams also has a huge challenge: convincing skeptical customers?and even some of his own people?to trust their future in an unproven American Indian-owned venture. It’s a leap of faith, after all, for CIOs who’ve been burned by the failure of seemingly well-heeled ASPs, or even had bad offshore experiences, to suddenly turn over even their noncritical systems to a shoestring-budgeted startup located in one of the nation’s poorest regions. For Williams, LTI is an entrepreneurial challenge. "Can we succeed," he asks, "and be a dynamic force in people’s lives?"

Life on the Rez

Lord knows the rez needs dynamic change. Isolated in central South Dakota, 90 miles northwest of Pierre, the state capital, on a chunk of prairie about the size of Connecticut, the 9,000-member Cheyenne River Sioux are rich in spirit and tradition, but dirt-poor by any traditional measure. Unemployment ranges from 65 percent to 80 percent. Many residents work for the tribe or the U.S. government (both the Bureau of Indian Affairs and Indian Health Services have offices in Eagle Butte), but commercial jobs are few.

 

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