Apple Pulls Out of India 696
tanveer1979 writes "Barely 3 months after it commenced India operations, Apple has decided to pull out its software operations from Bangalore. The employees will be given a severance package which is equal to two months' pay. The sales and marketing operations will remain on (these consist of around 30 people) but the software and support will be completely pulled out." From the article: "Apple had set itself a hiring target of 600 by the year-end. After a gala induction ceremony on April 17, the operations team went to Transworks for training. Some of the managers were about to leave for the US for further training when they were asked to stay put."
Re:we were wondering too (Score:5, Interesting)
30 people (Score:5, Interesting)
In Silicon Valley, a one cough by a hiring manager can cause 30 people to disappear overnight. Thirty people in India represented less than a million dollars worth of pocket change to Apple. The story in really, "What were they attempting to do in the first place?"
Irony (Score:2, Interesting)
When I first viewed the comments on this article, the quote at the bottom of the page was this:
The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of misery. -- Churchill
Do you figure that since socialism has gone bust, capitalism has had to take over the sharing of the misery?
Re:Payback's a bitch (Score:5, Interesting)
It's not the Indian programmers' fault that US programmers' jobs get outsourced to them. So it's not exactly medicine they're delivering. US jobs get moved to India because US capitalists want to increase their profits by getting the same job done for less money in India.
simply cost and quality related (Score:5, Interesting)
1) In 2001 with benefits, a decent Software Eng:
$60/hour in USA versus $5/hour in India
In 2006 with benefits, a decent Software Eng:
$60/hour in USA versus $25/hour in India
No longer worth the hassle of communication problems and slow response time to fixing defects.
2) Quality of their work was awful. This seemed to be due to major attrition problems. The attrition rates at the firm we were using were like 50% a year. Even their manager's were job hoping. So nobody really cared about quality since they knew they would be long gone to better pastures before it caught up with them.
Perhaps they found out... (Score:3, Interesting)
Don't get me wrong over b, I guess there are great people out there, but first of all: they don't speak English very well (ever called an outsourced helpdesk and you know), second of all: they are not educated as we in the westerner countries, so they need to be educated more and longer on the job while we are supposed to get that education through our schools. It's not the inhabitants fault, but India is pretty close to a 3rd world country.
Next to that they also have a higher constant cost. TFA mentions shipping over some people for education in the states. They can do it 2 ways: ship someone from west -> east and pay big $$$ (250k/year) for someone willing to do that and ship over his family and belongings back and forth every 3-6 months for 30k/year and cover the costs over there for 50k/year. Or ship 20 people every month from east -> west for 2 weeks and cover their costs for 400k/year.
If you don't do it yourself and outsource your outsourcing to a "specialized" company, you'll see that the costs equal the costs you have here but without the hassle of outsourcing, keeping your customers happy only thing is that you have to keep in account the unions.
I don't know, while outsourcing could be helping keeping costs down, I think the only thing that should be outsourced is labour by hand without customer contact. This is not because the people over there don't have brains, but simply because of the differences in language and culture. They are trying to fix that too, but what do you think when you call the D-Link helpdesk and "Bob" speaks with an Indian accent and ask how the weather is down there in Ohio? Yes, they have cue sheets with different lines that people in the US would use, but it just sounds wrong, try it.
And just so I wouldn't break Godwin's law: why didn't hitler outsource his stuff to India?
Re:we were wondering too (Score:5, Interesting)
Re:we were wondering too (Score:3, Interesting)
Re:we were wondering too (Score:5, Interesting)
Let the outsourcing stop, no not because of that! (Score:5, Interesting)
I guess I'll be the only Indian in the world who'd wish this outsourcing boom would settle.
Why?
Because we have contributed nothing to computing, technically or in research. This is more about the attitude of Indian software services companies. Infosys, TCS and the like, relegating writing software to a BPO styled operation. Cut and Paste mechanics, unhealthy and ugly code. 95% of coders here plain suck. I really hope software dev automation gets a breakthrough, so these guys lose their jobs (for which they are not qualified anyway).
These companies are surely helping India with jobs, but they have done _nothing_ for computing. (How many Indian Open Source products do you know!)No contribution to open source, and full scale leeching. Meanwhile, revenue is upwards of $2billion, profits $600 million plus. Yet.
Damn, I dont wanna think about it.
Btw, this is not a problem with Indian techies, there are so many of them working in research (abroad and in India) who are really good.
When you fire someone that means you have failed (Score:2, Interesting)
Firing people is bad for morale. It means that people shouldn't trust you. It means that your remaining employees should start looking for a different job.
Whenever I was a manager, I protected my employees. If they messed up, I coverred for them and helped them fix the problem. I have their back and I expect the same in return.
I think some people feel that because India is a long way away those employees don't matter. Only a sick kind of employer would feel that way. Once you hire someone you owe it to them to make it work.
Oh, but he did (Score:1, Interesting)
Re:say what? (Score:5, Interesting)
Apple wanted to stay in Cupertino (Score:1, Interesting)
Steve wanted to stay in Cupertino. If you listen to the town meeting from a month or so ago it is clear that getting the land for the new campus was not a sure thing. Estimates are that Apple paid 500 million for the land for the new campus. India was probably more of a contingency if they couldn't expand in Cupertino. Once that deal went though, then they needed to back out so as not to stretch themselves too thin.
It would look pretty silly spending 0.5 billion on a new campus and then have no one to fill it with.
Re:I have run across a good number of ... (Score:3, Interesting)
Re:Apple wanted to stay in Cupertino (Score:5, Interesting)
I don't think it's related to the expansion: the expanded campus won't be ready for a few years, so cancelling the plans in India now leaves a big gap.
Steve Jobs won't settle for quickly erected generic office space. That would be wildly out of character for the guy who had I. M. Pei design a floating staircase for NeXT headquarters, and who built that whole glass cube Apple store thing on 5th Ave.
It'll probably be 18 months before he signs off on a design by some 'name' architect. (For the sake of Apple's employees' vision, I hope it's not some blindingly reflective (yet old hat and ultimately boring) titanium-sheet Frank Gehry design.) It'll probably be another 6-12 months before the foundations are laid.
Re:Just like a number? (Score:2, Interesting)
tech support too? (Score:5, Interesting)
I wonder... I am an apple service tech and we have lost our dial-in support for service assistance in leu of an ichat-like support from... you guessed it... India. I talk to Chetan quite a lot but the names are very clearly all Indian. (they don't do like some tech support places, where you get someone with a hip-deep Indian accent who introduces himself as "Greg". Ya right...) A few times I've asked them where they were located, and it was of course some city in India. They do seem to be "otherwise occupied" when I chat with them, with 3-10 minute "ping times" on their answers being common. I also asked one of them one time, how many people are you chatting with right now? He says NINE. wow. Indians apparently have one thing on me, an amazing ability to multitask to the extreme.
While the people we are chatting with are actually quite capable and do a good job, they are being pushed much too hard to offer the level of service we were used to by the US reps on the phone. I don't know if that's Apple demanding it, or the Indian phone support business offering a no-questions-asked calls-taken-per-hour rate.
I seriously wonder though if this includes the service support also. I would like to see it go back to the old ways. If they are doing it, I would not be surprised if it were based on the feedback that they are receiving on their quality of service. "Sweatshop" work is never high quality.
If it's just the customer support that's being moved back, best guess would be the customers do not like talking to someone that they clearly can tell is not even in the same country. I know it slightly irks me when I call some support/help number and get someone from India. (why is it always India? why can't it be Russia or Japan or Africa?) I think that even if the person on the line is knowledgeable and helpful, knowing it's someone from India (or any other country really) tends to put people in the mindset that they are not receiving high quality support, possibly because they know that the support person is probably receiving a very small wage compared to what it would be in the 'states.
Re:Stuck on .NET and Windows (Score:5, Interesting)
My reasons for this behavior are
1.) Most Indian developers see programming as a lucrative career. So it is strictly business for most of them. Most devs of this kind don't go home and continue to program for "fun". It's work. If you can't sell your Haskell skills, no point in acquiring them.
2.) The educational institutions have evolved this way too. Most devs learn programming, not from college (even if they have a CS major) but from independent training centers that train you in job focused skills but not the whole "Computer Science" theory. The training is strictly main stream IT (to emphasize again - not CS). I on the other hand, am a geek, self-taught, learned programming for the sake of programming and even lectured a few Masters classes on Software Engineering and HCI.
3.) Finally the disagreement. Why generalize on Indians?. Now that I am in US, every non-geek programmer I have seen here is not much different either and is just as hopelessly married to his language. However, US citizens tend to follow their hearts when it comes to profession. The economy allows it. So geek / non-geek programmer ratio is more favorable. In India, you don't have that luxury. People follow the money (for good reasons). They do work hard at the skills but you can only get so much into it if you are not inherently passionate about it.
If you want good Indian programmers, scope them out and do your own interviews and select them just like you would locally (perhaps only possible if you have an Indian branch for your company). That outsourcing corporation will not cater your non-generic needs.
spare us the elitism (Score:2, Interesting)
You can do all that and more and still be up a creek if you have a run of bad luck. Hell, you could be a VP earning 300k a year and enough money saved up for six years worth of bills and be royally screwed by the loss of your job and any of these events:
The last can be a real bitch, because states get matching funds from the federal government for the child support they collect, so they have a strong incentive to collect as much as possible. It is difficult to have payments reduced in the event of a job loss and in any case might be set based on what you "should" be making. Some of the more draconian states will even seize your car, which doesn't make a whole lot of sense if you have to drive to get to your job.
Outsourcing....... (Score:4, Interesting)
(Here's something Pradeep Singh taught me today: if only 20% of your staff is programmers, and you can save 50% on salary by outsourcing programmers to India, well, how much of a competitive advantage are you really going to get out of that 10% savings?)
You also have the additionally huge costs of training those new employees, or outsourcing organisations, up in the ways of the organisation, the products, the technology and you also spend huge amounts of wasted time and money on communication. I've known many banks who've had that experience. A poor call centre worker gets the warm ear treatment from a customer in Europe, US, Canada etc. because the website is throwing up errors and he/she can't complete a transaction. A call is logged and there is a series of frantic phone calls and e-mails to the outsourced programming company in India, who needless to say, haven't got the faintest idea what they're talking about. Also (and this happens even in outsourcing companies situated in the same country but in another part) because they are not physically located in the heat of battle, and within on-site reach, they just don't give a shit. They'll do it when they've got time.
In short, you need to have your support functions in your company with you completely, and they need to be as close to your paying customers as you can get. If there is a market in India for your products then by all means get close to your customers and open offices in India. Idiot CEOs and boards still have this ridiculously stupid fucking idea that the world is a place separated only by a common language - English. I think even British, American and Australian people can agree that that is most certainly not true. I suggest these idiot board members go and read the number one, definitive guide on running a multinational company properly:
http://www.amazon.co.uk/exec/obidos/ASIN/18619769
What happened here is difficult to tell from the article, but maybe Apple had that sneeking suspision that maybe it just wasn't going to work.
Re:It wasn't cost, so was it quality? (Score:1, Interesting)
Perhaps it's fashionable to say so on Slashdot because that's the (admittedly anecdotal) evidence Slashdotters have seen. I'll relate my experience: I worked in an office with 6-7 Indians. When business began to boom they opened a satellite office in Chennai. The company hired 10 programmers. The head of operations (again, Indian) personally interviewed all the candidates and proclaimed them as "top notch". The reality was completely different. Only two of them were worth a damn. We had to filter their progress reports ("80% complete" meant "Not started", "Almost complete" meant "Just started", "Down to fixing bugs" meant "Rewriting to the spec that we ignored in the first place"). Lest you think that's just an ignorant racist American speaking -- that was from the Indian project manager. (As an aside, the company only had two non-Indian employees. I was one and the other guy was a "token" VP used to whitewash their appearance to corporate clients). Sure we could have only hired 2 guys here for the cost of the 10 guys over there. But we would have done a lot better on schedule.
And moves to China (Score:3, Interesting)
Re:we were wondering too (Score:2, Interesting)
A little bit of trivia; they had the folks over in Bangalore watch "Friends" in order to get an idea of what American culture was like to better interact with them on the phone. Just a tidbit I found interesting.
This makes sense - Steve Jobs is a perfectionist (Score:2, Interesting)
Here you have a man who is a total perfectionist. Obsessed with quality, down to the very last detail.
My guess is that some high-up Businesshead Suit Guy whispered in his ear, "Y'know, Steve, we could save a lot of money by outsourcing...."
Steve was probably reluctant at first, but then the Businesshead Suit Guy hyped it up with a bunch of Thomas-Friedman-speak, "This mind-blowing business practice will revolutionize how the world does business, like what corned beef did to sliced bread! Everybody and their brother is doing it! You don't want to be the guy who invented the pet rock! You want to be the guy who invented the pet WORLD! Don't get left behind! Outsource, outsource, outsource!"
Steve was probably like, "Oh, alright, I'll give it a shot. We'll start small, and see how it goes."
So he commits a small amount of money to his India project. Lo and behold, what he gets back is crap, and he's like, "What is this? This is crap! The quality is terrible! There are a million little widgets that are all in the wrong place. This little graphic thing was off by a whole 5 millimeters. 5 millimeters! My customers will hate it! I can't even get anyone on the damn phone to fix it! Every time I want bring someone to task over this, all they can talk about is their damn contract! Hey Businesshead Suit Guy? Where the hell are you?"
Unfortunately, Businesshead Suit Guy is nowhere to be found. He took the big fat bonus that he got from saving the company so much money through outsourcing, and is off vacationing someplace exotic.
Possibly even in India. I've heard that money goes a lot further down there.