Romania's got more than gymnasts

I think the so-called “outsourcing” flap is beginning to take the right perspective: it’s about the future of the global economy, not just economic recovery. Here’s an article saying that IT outsourcers are looking at Eastern European countries because “India’s getting more expensive.” Whaa?!


It turns out that there is a talent-pool in places like Hungary, Russia and Romania where they have strong mathematical skills, the bedrock of a lot of IT. There’s a pool of “well-educated, highly-skilled” people available dirt-cheap, and maybe they understand Western culture better than Asians.

On Lou Dobbs’ show on CNN the other night an “expert” said it’s not just jobs that are being exported, it’s intellectual capital. US-based companies are not just hiring low-level programmers, they are starting R&D and design operations where real innovation and creation takes place. That’s the highest-value IP.

Yeah, it seems to me when a tech company sets up shop it isn’t just jobs they offer, it’s know-how, its training, it’s intellectual growth. Companies are sort of little colleges. In the US often the best synergies are between companies and local universities. The jobs are the finishing school for college graduates and the spawning ground for entrepreneurs.

I remember reading a few years ago about negotiations between Boeing and China regarding expanding their operations. Boeing was building sub-assemblies in China, shipping them to Seattle and putting the planes together there. China didn’t want them to expand their sub-assembly plant; they wanted Boeing to set up a full-scale assembly plant. Why? Besides the immediate income, China wants to develop and market its own world-class airliner in a few years. What better way to get an education than to have a Boeing operation in the country—Boeing U.

To some people this kind of talk is “alarmist.” But when the smoke detector goes off, somebody needs to pay attention.

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