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Subject:RE: Boeing Tech Pubs going offshore? (long) From:eric -dot- dunn -at- ca -dot- transport -dot- bombardier -dot- com To:"TECHWR-L" <techwr-l -at- lists -dot- raycomm -dot- com> Date:Tue, 17 Jun 2003 09:04:02 -0400
>>It has to do with a brutally simple economic formula: the offshore workers are
>>one-third as expensive. At that rate, as has been pointed out, Boeing could
>>get three revisions for the price of one. You can't compete with that kind
>>dynamic by getting smarter, more experienced, or more professional; the only
way
>>to compete would be to produce three times as much (or more) at the same
>>quality level--or drop your salary requirements by two thirds.
Rubbish. Boeing only gets one chance at a first impression with a potential
client and if the docs aren't done and certification is delayed the costs could
be astronomical if they miss critical marketing opportunities. If you want to
keep the work, you have to provide added value/reduced risk/higher quality.
Now, you'll have to be creative in coming up with the resources and convincing
in your sales pitch to potential clients. But heck, contractors on this list
convince companies to hire their services instead of creating in-house resources
(or replacing in-house services). It's all just an extension of the same
competition.
>>This is all part of the same market economy in which you go to a superstore
>>and buy commodities at everyday low prices, but if you have a question or a
>>problem you might as well be on Gilligan's Island for all the help you're
gonna
>>find. It's the same deal as going to the gas station and pumping your own and
>>never seeing an employee. And when you get your purchase home, if there's a
>>problem, you log in to a Web site and hope that yours is a frequently asked
>>question.
Look at it this way, it's the same in all markets. While Circuit City (or Future
Shop for fellow Canadians) may sell most consumer electronics, there's still a
fair number of high end stores selling B&O, Marantz, and 25,000$ TVs. If lowest
cost and quantity always won out, Mercedes, BMW, Lexus, Audi, Acura, etc would
be lost causes. VW would be resurecting the Beatle in it's old form and not
marketing its 30,000 dollar retro replacement. Even for purchasing Gasoline you
can often find stations with service directly opposite self-serve stations. Some
sell at the same price and use the service as an enticement, others charge more
yet still seem to stay in business. A number of stations around here have both
self-serve and full-service pumps at the same station (you pay more for
service). Seems to me there's a market niche for more expensive high quality
goods in most markets.
>>I don't wish for bad things to happen to a Boeing aircraft due to outsourced
>>documentation, but I must report that ValueJet went out of business after a
>>Florida crash, the root cause of which was outsourced mechanics. (They didn't
>>know they were shipping a load of full oxygen canisters in the cargo bay, and
>>they were unaware it was a Bad Thing.)
Red herring. A large and increasing percentage of transport maintenance is
outsourced. It's not the outsourcing that failed in that case but the procedures
and reporting/management structure. Something that could go wrong regardless of
whether the work is outsourced or in-house. In Britain, that was the conclusion
of the health and safety inspector after the Pottersbar rail crash. A failure of
the maintenance company to follow procedure and a failure of the overseeing body
to manage the contractors.
If we're going to raise the spectre of safety issues, look for some serious
comparison studies instead of presenting convenient single examples. Many nasty
accidents have happened with airlines, railroads, powerplants, etc without any
outsourcing.
>>If you pull back the focus far enough, you see that almost all knowledge jobs
>>can be outsourced, but the national economy is based on consumer spending.
>>Outsource all the jobs and you eliminate your customers.
It's a little more complex than that. Boeing, as an easy example, does not rely
on domestic consumer spending alone. Boeing depends on the international market.
And considering the health of the US domestic airlines, Boeing may rely more on
international clients than domestic ones. Same holds true for other
manufacturers and service providers.
But then again the issue can complicate itself further. If the low paying jobs
are outsourced for even lower, a company can be more competitive, sell more
product, and expand. Any expansion means a requirement for more management and
sales workers which means more higher paying jobs at company headquarters. In
the end the local economy benefits from increasing standards of living.
As someone else already pointed out, would you like to be weaving 12 hrs a day 7
days a week for subsistence wages? If the Ludites had won, that's what we'd all
be doing. Either that or coal mining with pit ponies or any of the other ancient
standards of heavy industry or manufacturing.
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