India: Softening the Image of Outsourcing

Many voters may come to realize their jobs may be lost forever to outsourcing. In anticipation of this, the WSJ's Peter Beckett offers suggestions how industry can soften this impact.
What can the industry do?

First, the name has to go. “Outsourcing” is such an evocative piece of jargon that its very mention invokes a vast array of images and sentiments, few of them favorable if you live in the U.S. and are not the chief financial officer of a multinational corporation focused on your bottom line.

It doesn’t matter too much what replaces it, as long as it doesn’t try to define specifically the activity that is at the root of the friction, like “offshoring.” If you asked 20 people what “Accenture” does, far more would be familiar with the name rather than what the company actually does (outsourcing, among other things.) Yet is Accenture taking much heat?

Ah yes, you say, but Accenture is an American company that happens to do a lot of outsourcing work, as is IBM. So they are different and won’t be such easy targets.

Which is precisely why India’s outsourcers need to stop being so “Indian.” In an industry that is the very epitome of a globalized world, it remains remarkably parochial, despite its protestations that it hires tens of thousands of people all over the world, including in the U.S.

How many truly senior jobs are now located next to their clients, the majority of whom are in America? Are the people making the decisions in the executive suite—we’re not talking about account managers and “client-facing” executives—as diverse as the firms they serve?

And when will the day come when one of India’s big outsourcers takes the biggest plunge and decides that it is better for the entire management suite not to be in India, even if that’s where the majority of its workers remain. Who will move their HQ to Denver, Atlanta, Chicago, Zurich, London? After all, it’s not only where the clients are, it’s where the big investors are, too. So why is management here?

Cognizant already has its headquarters in Teaneck, N.J., and others may be on the way.

Pramod Bhasin, chief executive of Genpact in Gurgaon, says several executive-suite functions are now in the U.S., including the heads of software, new-product development, and investor relations.

“I very clearly see the time when our headquarters has to move,” he says, predicting it may happen in a couple of years. Does he get the sense that this is the kind of new environment that the industry as a whole is preparing for?

“Not necessarily across the board,” he says, which it is fair to say is an understatement. “I wish they would recognize it more.”

If they don’t, they may find themselves “Obama-ed” all over again.