Outsourcing: The Elephant in the Room

When you join a room full of CIOs for lunch, as I did at our recent CIO Perspectives conference in Carlsbad, Calif., the discussion inevitably turns to outsourcing. You may start out talking about the sunny weather, the rabbits on the golf course or even something job-related such as managing IT globally. But, somehow, someone always brings up offshore outsourcing, and away the conversation goes.

I don’t blame CIOs. Outsourcing is the elephant in the room. To not talk about it would be as awkward and disingenuous as watching The Apprentice without acknowledging the muffin growing out of Donald Trump’s head.

What surprises me is that I’m hearing a persistent new thread in the lunchtime talk. In the not-too-distant past, the thrust was always the economic inevitability of offshore outsourcing. “We gotta take advantage of the labor rates. We’d be fools not to.” And I still hear that as CIOs slice into their breaded chicken cutlets at the luncheon, glancing up between bites at the outsourcing elephant now lumbering toward our table.

But, today, I also hear that all this offshoring could damage the entry-level ranks of our domestic IT staff. Will it be possible to develop the next generation of IT leaders when these IT-starter positions are moving offshore? Will college kids shun the profession, seeing little chance of breaking in?

When these questions arise, there is usually at least one CIO at the table who espouses the economic theorist view that, due to fundamental laws of supply and demand, these negative consequences could never happen. But there were more than a few in Carlsbad who believed that the elephant now looming over our shoulders cannot be predicted so easily, that it represents a potential danger to the U.S. IT profession as we know it.

State and federal legislators think that they can control the elephant, or at least win election-year votes by attempting to rein it in. These efforts are detailed in Senior Writer Ben Worthen’s story, “Offshore Regulations: What to Worry About,” on Page 64. Are you as worried as the Carlsbad CIOs? Or do you agree that there will always be plenty of good IT jobs for talented newcomers in this country? Drop me your thoughts at pastore@cio.com.