Wednesday, December 15, 2004

Outsource Janet's job

Janet Albrectsen, one of The Australian's more controversial columnists, speaks out on outsourcing:

We should give developing countries what they really want and need – jobs. Our jobs. The best way to do that is by offshoring or outsourcing jobs or whatever bogy word is used these days. 

Tim Dunlop takes her at her word:

Can I please suggest you take up Ms Albrechtsen's suggestion and give her job to a nice Indian person?

I beg to differ. My Vietnamese teacher's English is excellent, he's a nice bloke, and he's got a wife and baby to support. Give him Janet's job. Perhaps that's a clear conflict of interest. But let me tell you about "conflicts of interest" after my thoughts of outsourcing.

My feelings are mixed on outsourcing. The idea, simply put, is "Why pay $75000 for someone in the developed world when you can get the same skills for $20000 in the developing world?" It follows that this process creates jobs in the developing world. That by itself is a good thing.

Take Việt Nam. The country has been booming , especially in the last 2 years. You can see this in the infrastructure. Internet cafés have moved from the 5-computers-on-a-28.8k-modem to full ADSL connectivity. They're fast, too, or were so a couple of months ago. And the software development market is also healthy. A friend has an uncle managing part of an IT company, and he's stated it's really taking off, especially with outsourced work Now my examples all involve IT, but could be extended to engineering, call centres, construction, etc. I wish the locals luck.

On the other hand, there are disadvantages to outsourcing. (Let's just slip by the problem of not understanding the accent of call centre operators.) Firstly, the obvious problem is that it costs jobs. Moreover, the looming danger of outsourcing creates morale problems in existing employees. (And as one commentator on Surfdom reported, it's tackless to call for this around XMAS.) Furthermore, it is not always clear that the benefits outweigh the costs.

Taking IT as an example (again!), you may be getting more programmers at a cheaper price, but how superb are they? Yes, they can dot their semicolons, and code without syntax errors. But sometimes they need a lot more supervision in understanding specifications and coding what the user actually wants:

Poor communication and low morale resulted in a large amount of software with code-writing errors that required "rework" by the team of 60 developers back in California. Training alone didn't seem to solve the problem. "Even after two years of getting the rework rate down in India, it wasn't [low] enough," recalls Dickey. While domestically the rework rate was about 30 percent, "when we first started [in India], we experienced error rates of about 70 to 80 percent."

(I also notice that the MBA's and CEO's never think of outsourcing their jobs, despite the obvious efficiency incentives. As bad as absentee landlords in Georgian England, they are. And one never knows how this whole outsourcing business could work out. Perhaps a more-or-less developed Việt Nam in 2035 goes through another round of it, and starts transferring jobs to Ethiopia or the Ivory Coast.)

Now, I should report my second conflict of interest. Back in Australia, I was a computer programmer. In Việt Nam, I'm an English teacher. Now, I eventually want to return to Australia, but I would like to be employed. Especially as I may be getting married soon and may have a child or two on the way. I would like to return to IT eventually, and I would rather have a job in this sector. So outsourcing jobs makes me uncomfortable, especially in this area.

However, outsourcing Janet Albrechtsen's job in The Australian is a win-win for everybody. Hmm... how do you explain her to a foreign audience? Well, to call her conservative would be an insult to true conservatives everywhere - such as the good folk at Antiwar. True conservatives I respect, even if I don't agree with them. I don't respect Janet. Now with her, we're getting the impartialibity and fairness of Rightwing crank radio grafted onto 3 column inches of writing. In other words - pick a suitable target of the Left - Muslim immigrants, unions, "femocrats" (her bit of jargon), and "Whole Language" learning, to name a few.

But what you don't get with her is a revelation of her conflicts of interest. For example, I always wondered how she got a job at The Oz, considering her training was as a lawyer. She never brings anything new to the conversation, so it's not her repartee. There's some revenue in her "outrageousness", but if you're that way inclined, you'd read The Daily Telegraph or some other tabloid. You can't even say she's a good journo, considering she's been caught out misattributing people in attacking Muslim immigrants. So how did Janet get her job?

What makes it interesting is that her hubby is one John O'Sullivan, senior partner of Freehills, a legal firm. And according to Crikey:

Mr O'Sullivan "acted for Air New Zealand in its two-stage acquisition of Ansett Airlines in 1996 and 2000." This cost "the Kiwis more than $1 billion."

Ansett eventually went bust, while Rupert Murdoch's NewsCorp (the owner of The Australian) made a tidy profit:

"...sell Air New Zealand the biggest pup going around and book a $340 million profit on the sale, he's still going to collect on his profit share deal to be also paid 10.5 per cent of the market value of Air New Zealand measured at some point between June 2002 and June 2004." 

And when you're attacking people like Greg Combet (ACTU secretary) for Ansett going bust, and not disclose your husband's involvement in the matter - that's a conflict of interest.

Outsource Janet Albrechsen's job. Outsource it now.