Chile Economy — 19 July 2011

That Salman Rushdie was condemned to death by Iran (fatwa) for writing “The Satanic Verses”  is well known.  That he was treated similarly by India is not.   The Hindi Indian government cast him into exile to try to keep the peace with the Muslim minority (he was already living abroad).  Years later when Rushdie was allowed to visit his native land again he noted that all the Indians appeared to be studying the Java and Oracle computer languages.  Had Rushdie succumb to the widely held misconception that India is somehow synonymous with computer science dexterity?

For three years I managed a team of Indian computer programmers while working for Sprint in the USA.  These Indians were outsourcing partners of Sprint working for EDS in Bangalore.   The executives at Sprint were laying off American based IT workers on the one hand and on the other replacing them with Indians offshore in effort to lower cost.  Sprint paid EDS around $25 USD per hour while each USA worker earned around $50 USD.  But since the productivity of each Indian was a fraction of what was delivered by the US worker it might have actually cost Sprint more to do this.  (The executive in charge of that 1,000 person division declined to be interviewed for this essay.) My experience working here in Chile is that Sprint would have done better to send their offshore work here to Chile.

At Sprint, I was assigned the task to manage this staff of 12 persons but since they had no experience in the products with which we worked and seemingly could not speak on the phone I was frustrated in how to manage this resource.  I trained each of them personally but as we would say in the states they could not rise to the challenge to solve the problems which were pressing down upon us. So I began to use them for what was basically the clerical work of updating tickets and editing data in the database.  The more difficult tasks of writing and fixing programs we continued to work stateside.

While their productivity was less than optimal there was one advantage to having an IT staff 12 time zones away.  Since Sprint customers needed support around the clock it was useful to delegate certain tasks work to the offshore staff who started their work day at 3.00 AM EST (which was 2:00 AM at Sprint’s headquarters in the next time zone). So they could, for example, restart the computer systems while our customers and employees were asleep with minimal risk to the infrastructure and ongoing operations.  Were a problem to arise that they could not handle they would phone me or the other persons on call and wake them up.

What was the problem with the offshore resources and why could they not deliver on expectations?  Answer: they could not communicate verbally.  A manager who I greatly admire once told me that if an engineer has great technical skills but no ability to communicate, “He is no good to me”.  So it was with our offshore staff of Indians.

Sprint had recently merged with Nextel and the results with regards to the computer systems working in concert could at best be declared a disaster. Because these systems did not work multiple times per day and well into the night and weekend we were summoned to join conference calls where dozens of engineers would congregate to try to diagnose and solve problems which were impacting Sprint’s business.  Such conference calls were called “bridges”.  One person generally ran the bridge asking escalation managers to contact specialists in different areas to drill down into the problem at hand.  For example, customers on one occasion could not recharge the balance on their prepaid cellular phones.  On another occasion Sprint resellers at Walmart and Radio Shack could not provision new customer cell phones.   Obviously these high visibility outages required people on the call who could think quickly and work under stress.

I was supposed to use my offshore staff of EDS programmers to assist me but the Indians never said anything, not one word on these conference calls.  This puzzled me greatly.  American managers and engineers would be working diligently trying to get the company up and running but the silence from the other side of the planet was, as they say, deafening.  So to circumvent this problem I started to using instant messenger software to relay instructions to my team.  It was if we were working with people who were deaf who could only communicate with sign language albeit in electronic format.

I thought the problem was that the workers there could not speak English.  But English is one of the officials languages of India and a lasting legacy from British Raj Queen Victoria and Prime Minister Disraeli.  I wondered how these workers having moved to Bangalore from different Indian states–where they spoke Kanada, Telegu, and a host of different languages–talked to one another in the office.  They assured me they talked to each other in English.  I found that claim spurious.

I found out later from an Indian manager who had come to the states that fluency in English was not the problem.  Rather it was a cultural disinclination to speak up when someone more senior is in the room.  That was the problem.

Some years ago there was an airliner crash in Korea and the investigating committee discovered that the copilots in the cabin lacked the tools in the Korean language to overrule the captain and tell him he had made a mistake.  The problem was that there are several verb tenses in the Korean language–one you used with friends and families and another that you use to speak to persons in authority.  To prevent future communication issues Korean pilots were then prohibited from speaking Korean in  the cockpit because to do so would mean they would have to speak deferentially to the boss when a crisis was at hand.

The egalitarian USA does not operate this way.  If the bosses and their engineers were sitting around a conference room table and the senior person on board said something that was incorrect their subordinates would not hesitate to point out their mistake and do so with abandon.  That is how one solves problems rapidly. Engineers need to debate one another until that person whose idea is most logically sound is pushed to the forefront.  

The problem with the Indians was they would defer to the most senior person in the room.  Of these were EDS managers who knew nothing of the technical issues at hand because they did not work with us on a daily basis.   If say, NASA, were to operate as does the Indians or the Korean airline pilots we would have capsules falling from the sky.

Some of Sprint’s offshoring was handled not by EDS operating out of India but IBM operating out of Brazil.  I had no problems with the Brazilians and looked forward to their assistance.  The Brazilian workers spoke English with hardly no accent and with the clarity and determination that one would find in the USA.  They were not shy and reserved as were the Indians.

I was long puzzled by this issue, so I turned to one of my former workers at Sprint in India.  He wishes to remain anonymous but I can tell you that he is an engagement manager at KPMG in Bangalore.  He was my best employee (the only good one in fact) so I made him team leader.  Obviously he impressed KPMG too because they gave him a job.  Here is what he has to say about the Indian workforce (verbatim) with only some minor changes to the grammar:

I do strongly agree with your point that ‘communication and verbal discussions is how problems are solved’… for that matter anybody else on earth will have to agree with this!
You need to understand one thing here.  “Most” of the Indian (or any outsourced countries) will employ more of freshers , less experienced  learners onto the team  for head count  and billing purpose.  They are available at cheaper salaries as you already know. Such organisations will have only few experienced members (called “senior members”).
Those less experienced learners usually will have inferior feelings of knowledge and will be lacking in ‘average’ English too. That makes them silent always during discussion.
Even those so called “senior members” might not be having “relevant” experience in the subject and that leaves them crippled sometimes to speak out. Some of them will have serious spoken and written English issues, even though they are good at work, and that again makes them dumb on bridges.
Above all, 90% of the folks will have their own apprehensions of “being watched’”,of their performance by client, their employer, and management.  Hence they play safe by not talking much.  They always look toward the senior members when any questions are asked by the USA or European client.

I would say any American IT executive reading this who was written large checks their outsourcing partner would be annoyed by this statement to say the least.

Fast forward five years or so and I am working in Chile now.  Having spent five months already working in IT here I would say that Chile would be a better destination for outsourcing computer contracts than India.

One obvious advantage that India has is their their tenure during the British Raj gave them fluency in the English language.  However bad their accent, however difficult it is to understand them on the phone, it is still passable English.  I would like to say that Chileans on average speak better English than the Indians but the truth is that they do not.   Here at my office our primary business partner is Computer Associates.
Whenever there is a problem with the computer systems here I can ring up my contact here in Santiago at Computer Associates and he speaks perfect English.  But not all my coworkers are fluent in English.  (And as we say neither are the Indians.)

The leader of the computer project where I am working now is a former Computer Associates engineer.  He speaks English fluently and is helping me immerse myself in the office here.  Most of our clients and my other coworkers do no speak English fluently but they speak it O.K.  Some speak it fluently.  The educated Chilean IT worker can all read English perfectly as all the computer manuals are in English.  All computer programming languages, for example, are described using English commands.  My own Spanish is halting.  So when my client or coworkers see me having difficulties in the Spanish language they explain things in English.

Most Chileans people know some English perhaps because they learned it at what some call the “HBO Academy”.  This means they see movies and television which are usually in English with Spanish subtitles.  The better educated persons coming from the privileged classes speak English fairly well.  Some of those have attended British academies here.  Obviously if a Chilean company would to orient a team toward working with an English speaking clientele overseas they would require than their employees speak English so they would only select those who do.  Before choosing my current employer I interviewed with one such operation who did work with IBM products.  They wanted me in part because I could be a team leader who could speak English with their customers whereas some of their employees were not very strong with the same.

What about the problem of deference to the senior guy?  What I see here so far is there is no such a hierarchy.  My coworkers and I do not hold back our opinions when the manager or client has made a mistake.  We are free to engage in debate which is oh so important to problem solving.  As was said earlier an engineer who cannot communicate is “no good”.

Chile is a stable country with a growing economy.  The price of copper has helped the country recover from the Great Recession which still plagues the USA.  There is no recession here as the country is growing rapidly and headed toward full employment.  Of course the same thing can be said for Peru, Brazil, and Argentina.  But Chile is not Peru nor Argentina–it is far more advanced from an economic and political point of view.  It is the first Latin American nation to have joined the OEDC (Organization of Economically Developed Countries) along with the USA and the latest entries Iceland and South Korea.  Carlos Slim, the Mexican who is the world’s richest man, says that Chile will be the first Latin American country to reach developed-nation status.

Workable English, a good system of vocational and university education, the presence of many multinational corporations here, and a stable democracy all suggest that Chile would be a good place to look for those American and European nations looking to outsource some of their IT work to a low cost destination.


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(2) Readers Comments

  1. Although one programmer has the necessary skills and knowledge to work competently on a problem or even create a program, he or she can only do so much. Creating the source code for an operating system, for example, will require thousands of manhours from a single programmer and most probably, he or she will only be halfway through. There just isn’t enough time for one or even two programmers to work effectively to produce a usable program.”*

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  2. Have you ever heard about “Uruguay” ?

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