Wednesday, July 7, 2010

Bangalore, Boston and Beijing !!

This article is inspired by the readings from Thomas Friedman's "The World is Flat" where he discusses how over time, especially in the last decade the world has become a "level playing field". Specifically during the IT bubble era, massive investments were made to connect the whole world through broadband and undersea optic cables. Computers became cheaper and widespread, and there was advent of e-mail, IM clients which made communications amongst people in various parts of the world cheaper and convenient. Availability of information was made easier by search engines like Google and Yahoo!. Propriety softwares were engineered which could divide the work into logical pieces and distribute one part to Bangalore, one part to Boston and one part to Beijing where they would be developed simultaneously to be later assembled as a complete product.

There are uncountable benefits of such kind of a product development process. It not only makes the production cost come down but also adds a new dimension to the product. Production cost is reduced significantly as the parts of the job are assigned to the places where they can be done at the lowest cost. Moreover, people from various cultures, where the needs vary can add new dimensions to the product in order to make it globally usable, thereby increasing the market size for the product. Tens of thousands people at more than 30 companies on 3 continents worked together to make Apple's first iPhone possible. All in all, people with best possible skills come together to develop a product. But how do consumers benefit from this process?. Simple, they get high quality products at competitive prices.

There is no doubt that America is one nation driving this change in product development process. Be it Google or Yahoo! or Microsoft or Amazon, all are the creations of American nationals. It is due to the research going on in American universities that we have such high speed internet connectivity and companies can now do round table video conferences with their colleagues in other countries, discuss the prototype along with planning and distribution of tasks. But has USA really gained from it, from a long term perspective? Recently, there has been a lot of hue and cry over jobs being send overseas. People of America are for sure facing tough competition from their counterparts in Bangalore and Beijing. But that is the strength of our character; we are always at our best when challenged. Instead of wasting our time on putting up rallies on this issue, we should accept the fact and face it with wit and vigour. We should learn lessons of hard work from Indians and Chinese. And always remember one thing, be it good or bad, the time always changes for "Nothing but only change is permanent"


  1. I think a global development process like this one, which is usually employed by big IT Houses like microsoft, is actually beneficial for the global economy on the whole.It would be unfair, to assess whether the U.S has benefited from it or not, because a decision to collaborate with counterparts in Bangalore, beijing, even Israel, was already made, and I believe the U.S is fully aware of the results of such collaborations i.e competitive pricing, hi-end products with the best technology and the best professionals in the field.Obviously, they are set to earn added cash inputs as they hold licenses to all their products, but a project with this magnitude is helping the economy of other nations, as well as recognition for their talent, which can't be a bad thing.U.S still gets the credit for being a pioneer in various fields, from the health industry by producing world class medical centers like Mayo, John Hopkins to leaders in the IT industry with Apple, microsoft and google.Hats off to the U.S! :)

  2. I completely agree with you on the front that world as a whole has gained from the collaborations and US in particular has achieved amazing results out of this, especially in terms of technological advancement. But the recent recession has forced us to restart a debate on pros and cons of outsourcing. US at this moment cares least about boasting "credit" when millions of its citizens are unemployed and the treasury does not have enough to pay towards unemployment benefits. You see, there is always a trade-off as far as outsourcing is concerned. You get best skills at cheap price but at the same time you have to send jobs overseas because of which it becomes difficult to sustain growth in such fast times due to lowering of demand.

  3. For many jobs its not the place that matters its where the right skilled workers are.