Monday, 25 June 2012

I dunno but is The Register just a little bit racist here?


I'm not a techie and can't really comment on the causes and background to the RBS meltdown but I do think that The Register might just be a little racist with its bold capital laying of the blame thus:

Staff who oversee batch scheduling for RBS are based in India

Maybe they are (although RBS haven't said one way or another) but the implications of this statement are that outsourcing IT work to India - where wages are lower - is a dangerous and risky matter. And that none of the blame falls on British-based IT management.

The Register would have a point if there had never been a major IT disaster overseen by more expensive British workers!



Al Jahom said...

You surprise and disappoint me in equal measure, dear chap.

Let's be clear: Offshoring the development and operation of your corporate IT systems is incredibly risky. It's a nightmare of international lawyers, cultural mismatches and language confusion.

As it happens, India is a location of choice for all the reasons you already know - high levels of education, relatively good English, low wages etc etc. China will probably really pick up too, if they can get their appetite for industrial espionage under control.

My company offshores as much of our customers' IT operations - to India, eastern Europe and the tiger economies - as it can. The risk management and service delivery challenges are beyond belief.

But at least we're a company with a huge UK based organisation (10k UK employees). The Indian outsourcers are slippery and often prove almost impossible to get legal remedy from. Whoever is buying the outsourcing service needs to be able to play chess, poker, Risk and Monopoly at the highest levels, simoultaneously, in 3 languages.

In addition, smart Indian graduates are ambitious. They want much more than to work on IT systems for some poxy nationalised (and doomed) UK bank. Staff turnover and knowledge retention are huge problems. I know this from professional experience.

So, you see, nothing in the Register's article blamed the problem at RBSG on Indians, but on idiots in RBS who either didn't know the above, or ran with haste into a situation it can now repent on at leisure.

Anonymous said...

It's not racist. It could be the Chinese or the Russians - it's merely that the Indians have the market.

Most of these people have never even seen a mainframe.

The majority of people who work in IT (and there is a shedload of Indians amongst them) view this outsourcing business with awe - in the real sense of the word.

SadButMadLad said...

The Register is not being racist. They are just stating facts. Most Indian workers are pretty bright and intelligent. As Al says, India has good education and English speaking. However, there are social differences which cause problems with outsourcing to India. Number one being that Indians don't like to say no to authority. Unless the UK side understands this, then you end up with huge problems. Other problems are due to the Indian companies who do nothing to stop the churn in their staff. So though they might be smart, they don't have much experience of whatever product they are supposed to support.

I'd agree with Al (and having had a partner in a major bank what I've heard sounds very much like RBS's situation) that RBS have outsourced key procedures and lost a lot of internal company intelligence through redundancies. Outsourcing works, but only if you outsource non-key stuff and stuff that can be made cheaper through scaling.

This stupidity of outsourincg for outsourcings sake has led to inexperienced staff doing silly things and then not fully understanding the consequences as they try and correct the problems.

The Stigler said...

"The Register would have a point if there had never been a major IT disaster overseen by more expensive British workers! "

In terms of banking, I don't think there has.

I worked in IT for a financial services company for a decade and we never saw anything like this.

The big thing isn't that they were Indian, but that Indian outsourcing means you have staff with less experience of the software and are often turned over quite quickly. Banking IT should have a large number of staff with 10+ years on the software, people who can instinctively know what to fix, who can do what I could do and say "yeah, that's in xyz123 field" off the top of my head.

And because you have a separate company, a whole load of contractual stuff happens that slows everything up. With internal IT, things can be agreed verbally and the paperwork done later.

Note: none of the major internet companies like Amazon, eBay or Google outsources their main systems.