Subject:
neoIT- Atul Vashistha Discusses Outsourcing Program:
All Things Considered Airdate:
March 16, 2004 Station:
NPR Profile:
Outsourcing entrepreneurs going back home to export American jobs
MICHELE NORRIS, host:
Outsourcing has also created a whole new industry here in the US: consultants
who help companies send their jobs overseas. NPR's Laura Sydell has this
profile of one of those entrepreneurs.
LAURA SYDELL reporting:
Fifteen years ago, Atul Vashistha came to the United States to get his MBA at
Arizona State University. He stayed here, became a citizen and rose to the rank
of international vice president for Cardinal Health in the late 1990s.
Mr. ATUL VASHISTHA:
As I was doing this--you know, doing business in 18 different countries, really
was amazed by how talent and really engineering management talent was
developing in countries like India and Philippines and other places.
SYDELL:
Although it's hard to remember right now, back in the late 1990s, there was a
shortage of tech workers in the US.
Mr. VASHISTHA:
So companies were looking for talent outside the US, and that's what really
gave us the idea of forming a company that would provide technology and
services to these Global 2000 companies and help them globalize their services
operations--IT and back office.
SYDELL:
That means getting rid of any job that not central to the company's main
business. In 1999, Vashistha founded neoIT. The company employs 68 people in
the US and abroad. Vashistha says it's difficult to calculate how many jobs his
company has outsourced, but he says neoIT facilitated a billion dollars in
contracts last year. About 70 percent of that money went to businesses abroad,
but rising unemployment has changed the climate around outsourcing.
Unidentified Man #1:
Keep American jobs in America.
SYDELL:
Last month in a New York City hotel, Vashistha co-sponsored a conference for
executives on how to outsource. CNN captured a group of protesters who stood
outside the doors.
Unidentified Man #1:
I'm angry at what's going on here, and it's time to stand up and be counted.
Unidentified Man #2:
We're killing ourselves in this country, and cheaper products and services are
not going to be enough to make up for the fact that we don't have jobs.
SYDELL:
The business of outsourcing is much tougher these days on a personal level,
says Vashistha. Even in the calm of his Silicon Valley offices, he gets hate
mail almost every day. But the tall, lean, 38-year-old CEO is convinced he's
fighting the good fight.
Mr. VASHISTHA:
I feel that somebody has to speak up for it, and you know, I have made a career
out of globalization. I absolutely believe that it's great for the American
economy, and that's why I feel that I ought to get up and speak about it, and
I'm hoping that others do.
SYDELL:
Like other proponents of outsourcing, Vashistha believes that helping American
companies cut costs will free up money for investment that will lead to
innovation and create new jobs. While most businesses are interested in cutting
costs, analysts say many are reluctant to outsource because they don't know
much about doing businesses in countries like China or India. So they turn to
consulting firms like neoIT. Rachael Son, a director of product architecture at
Pyxis, a medical systems company, says Vashistha helped them find the right
talent.
Ms. RACHAEL SON (Pyxis):
The relationship in India is great when you're looking into the Indian
outsourcing vendors because he has a lot more knowledge about each
company's--their management structure, their performances, so on and so forth.
SYDELL:
NeoIT exemplifies a major force behind the outsourcing trend, says AnnaLee
Saxenian, dean of the School of Information and Management Systems at
University of California-Berkeley. She says in the last decade, many Asian
entrepreneurs, like Vashistha, have come to the United States.
Ms. ANNALEE SAXENIAN (School of Information and Management Systems):
The pool of people that came to the US and went to school and then ended up
often in places like Silicon Valley has paved the way for this outsourcing.
These are people that know the language, the culture, the institutions and the
customs in places like India, but can also speak the business language and
relate to the technology community here in the US, and that's a unique set of
skills.
SYDELL:
Saxenian and others view these immigrant entrepreneurs as a huge plus for the
US. The analysts tend to view outsourcing and globalization as inevitable, and
you can see why. In Silicon Valley these days, software companies start-ups are
being designed from the ground up to take advantage of skilled overseas labor.
As these start-ups grow, they will inevitably force more established companies
to follow suit in order to remain competitive. But for the moment neoIT CEO
Vashistha says many of his customers are reluctant to talk about their
decisions. They want to avoid becoming part of the political storm circling
around outsourcing. Laura Sydell, NPR News, San Francisco.
