View all notes
Available query params: commented=1, untagged=1
Service provision by remote delivery also directly helped firms increase productivity and move up the value chain. [...] body-shopping had spawned much employee poaching by the TNC clients of Indian software firms. [...] With body-shopping reduced, so too was poaching. The potential of firms to upgrade was, therefore, significantly bolstered. Second, remote delivery allows firms to keep most of its employees under one roof. This facilitates knowledge and experience transfer within firms. Again, this boosts a firm's ability to take on more complex projects. Thus, as service provision by remote delivery became more common, firms were able to win increasingly advanced and lucrative contracts. [...]
The competition in the domestic labour market between Giants and Majors initially induced the Indian Majors to move up the value chain. [...] the Majors had long since settled on informal anti-poaching agreements amongst themselves, acknowledging that the costs of poaching far outweighed the gains. Second, the Giants, who could in theory, reap all the benefits of poaching while facing none of the costs (given their superior ability to attract and retain talent), also refrained from such practices during this period. They were just beginning to enter India, had not yet secured NASSCOM, and did not want to trigger any antipathy to their expanding presence.
Without poaching, competition took place in graduate-level recruitment [...] the Majors were forced to raise their entry-level salaries. The commercial imperatives of ensuring they then got 'their money's worth' from such graduates impelled the firms to embark on significant organisational efforts to improve productivity. In particular, serious investments were made in staff training, quality control and other human-resource practices. [...]
These changes transformed the Indian software services firms, catapulting them up the value chain [...]
reminds me of the no-poaching agreements in SV, and also in Germany. what should the left take on this be???
[...] Having secured their control of NASSCOM, and through NASSCOM the IT policy agenda, the Giants felt suitably emboldened to change tack in their recruitment. They stopped employing entry-level professionals and started poaching experienced employees of other software firms, in particular from Indian Majors. An unofficial feeder system quickly materialised whereby the Majors and other Indian software firms trained their employees only for the best and brightest to be poached by the Giants after a number of years.
The impact of this on the Majors was catastrophic. In their quest to compete with the Giants in the top tier of the software services industry, the retention of staff was vital. [...]
The effects played out in the wider competition between the Majors and the Giants. The Majors, wracked as they were with already high and growing attrition rates, struggled to move into the highest echelons of the software services market. In contrast, the Giants successfully entered the product market in lower-end IT services previously monopolised by the Indian Majors [...]
continuing from the previous note - that peaceful system didn't last
to think about more: what is the left objection to practices like this? why is a victory for global capital worse than a victory for domestic capital? should it be axiomatic or based on the specifics (income inequality between workers and execs, etc)
This change from domestic to transnational ownership [...] is a concern for the long-term development of the industry, as well as for India more broadly.
[...]
Second, a captive-dominated industry primarily exporting ITES is far less embedded in the economy and therefore less developmental as well as more unstable. [...] TNCs are likely to see their captives in India - no matter how large - as peripheral to their core, higher-end service operations. They would thus not think twice about closing or downsizing their operations in India and moving them to another destination (off-offshoring) [...] The risk of off-offshoring is increased by TNCs primarily being engaged in ITES exports. As ITES requires labour with fewer skills and less training, there are far more destinations for TNCs to recruit to. With software services, the pool is far more limited. [...]
Third, the shift from local firms to TNCs has a number of deleterious effects on the wider Indian economy. Due to the repatriation of profits by TNCs, there will be considerable leakage from the economy of the foreign exchange generated by the industry. In addition, due to the intra-firm migration practised by the Giants, such an industry will exacerbate the brain drain, leaving an acute shortage of highly skilled persons in India. And finally, the Indian state and Indian firms will be forced to rely on Giants rather than local firms for their large IT projects. This will significantly raise the costs of such projects, possibly to prohibitive levels, and thereby further impede the diffusion and adoption of IT across the country.
ok this kind of addresses my question from the last note
[...] FDI in ITES and It will not automatically lead to greater IT diffusion [...] part of the 'business-friendly environment' allegedly required to develop an Indian-style software industry is the strong enforcement of anti-piracy software laws. [...] As NASSCOM became dominated by TNCs (including Microsoft) the state zealously began to clamp down on software piracy [...]
[...] the pursuit of better access to visas for short-term skilled migration has led the Indian negotiating team at the WTO to side with the developed world in promoting full-scale liberalisation of services. Such liberalisation measures are not necessarily in the interests of the rest of the Indian economy, nor indeed of any developing economy. This is why India was the only major developing country to side with developed countries in these negotiations. [...] Access to H1-B visas is now being used by the US government as a key bargaining chip to gain better access to the Indian market in industrial and farm goods.
he later says the situation is bordering on the farcical, which is a nice way of putting it
Aside from the simple geographical designation, Silicon Valley is the name for a psychological obsession found anyplace where people believe that instant fame and fortune can be gained through silicon chips and Web sites, or lotteries or stock-market trading. This dream nourishes itself on an addiction to money, power, and instant gratification. And like heroin and cocaine, it is highly illusory, promising total happiness, but often ending in disarray and despair.
[...] Workers and bosses? Those were twentieth-century phrases, according to the CEOs. They were outmoded, old-fashioned, irrelevant concepts. Their new mantra was: "We're all equal, we're all a team, we all work as owners of the company because we all have stock options. So unions are passé, since we all are owners who have a common interest: the harder you work, the more the company will grow, and the more money you will make. Unemployment is a meaningless word in our new economy. Our growth is permanent, so there is never any reason for company layoffs. Place your faith in the company, which will never let you down."
This sounded very reasonalbe to the young high-tech engineers [...] knew little about employment practices in the real world, since the Valley jobs were usually one of the first in their careers. The Valley companies made a specialty of hiring new or recent college graduates rather than seasoned workers in the high-tech industry. These young people were naive, malleable, and could be employed at a cut-rate wage scale. [...]
how many stock options you got, buddy
Not far away, Oracle CEO Larry Ellison is building a $40 million-plus replica of the Japanese Katsura palace on 23 wooded acres. Presumably, he'll be parking his new Marchetti Italian jet fighter elsewhere - perhaps next to the aerobatic plane he just bought as an eighth-grade graduation gift for his son. In Atherton, Tom Proulx, a co-founder of Intuit, recently bought three neighboring lots so he could build a 9-hole golf course in his backyard. One Woodside programmer bought 24 acres just to land his helicopter. "Keeping up with the neighbors in Silicon Valley is getting weird," says Daniel Case III, president and CEO of Humbrecht & Quist, Inc., It's not, "do your kids go to private school." It's "do they have a private jet?"
we gotta tax the shit out of these motherfuckers
[...] Kaleil had just quit his high paying job at the prestigious Wall Street firm of Goldman Sachs. But he and Tom felt "ordinary" because they hadn't yet become millionaires at the age of twenty-eight. They had an idea they thought was the key to fame and fortune: they would establish a Web site that made it easier to pay parking tickets, pay taxes, and buy licenses through their GovWorks Web site. They kept convincing themselves that they were right and speculated how wonderful it would be for people to use their Web site at three in the morning to buy a fishing license from home or attend a town meeting from a Web site while in their underwear.
this makes me wanna cry/laugh cus the fishing license part is almost identical to how toby described gov.uk/pay (ie, a public service that no one is profiting from)
best part: they end up raising 60m in VC (mostly FOMO i guess)