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A cheeky little innovation in outsourcing

by sourcingfocus.com

Yesterday a news story did the media rounds concerning a high-paid US software developer outsourcing undisclosed work to China. This example represents one of the most resourceful and innovative uses of outsourcing available and should be commended, if not for the violation of multiple company practices.

The story was that the software developer had outsourced his own workload to a contractor based in Shenyang, China. The cost of this undisclosed sub-contractor for the software developer was less than one fifth of his own wage, leaving the developer with a free day, spent apparently in this case on viewing cat videos. This action was discovered after an audit surrounding fears of a security breach following the discovery anomalous activity on the company’s network.

An analysis of the employees computer revealed his day-to-day activities while he outsourced his work-load:

9:00 a.m.—Surf Reddit, watch cat videos
11:30 a.m.—Lunch
1:00 p.m.—Ebay
2:00 p.m —Facebook and LinkedIn
4:30 p.m.—Send end-of-day e-mail update to management
5:00 p.m.—Go home

The reaction to the discovery by the company saw the termination of the developer’s employment, this is clearly a missed opportunity; the correct response to this discovery would be to give the developer a seat on the board and a raise.

The practice of the worker should be taken on board with the company moving to outsource all work of this type to the Chinese contractor. Based on this one example, the company at worse could expect to make cost savings of 80 percent through outsourcing work carried out by the developer, other developers carrying out the same work, and similar job positions, with greater savings presumably available from economies of scale. The amounts to be saved are not inconsiderable with the developer earning a six-figure salary.

Just as the developer increased his available free time, so to would the employer increase savings (although the developer’s use of his savings made invested in cat clips might be best avoided).

You might ask yourself was the work carried out poor in quality, ineffective or inferior? No, in fact the work carried out by the Chinese developer was viewed to be of a high standard, with the employee viewed as being a talented individual. The developer’s performance reviews including descriptions of the coding as being “clean, well-written”, he had even been described as “the best developer in the building”, despite the actual ‘best developer’ not even being in the same continent. Rather than delivering a poor quality service, the Chinese contractor delivered a high end service.

Copying the practice of the unnamed developer does pose difficulties. The original outsourced action was brought to light because of security concerns and these issues would still exist. While issues common in outsourced services including security would exist, other common obstacles including control and transparency hardly seemed to be present in the delivery of the original ‘in-house’ service anyway given the employees ability to outsource his entire job, and issues of a reduced quality in service would seem to be a non-issue given the reviews of the work provided.

The developer found an effective third-party to which he outsourced his work to, he delivered the service that he was paid for as an employee. It is a failure of the company to carry out a wide reaching procurement that should be focused on. This example should be leaped upon and paraded to demonstrate the efficiencies of outsourcing.

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