Racism by Indian IT Companies in the US
Recent articles in the Indian media¹ ² ³, reported a racism case filed by an ex-employee of Infosys at the US. Though there could be truth to the claim, it is not completely the racist issue as seen today in the West, but it was a constraint put on by their business model. In a way Indian Companies too are victims of certain kind of corporate racism.
I have worked in Information Technology for 15 years. I’ve worked as Business Consultant and Project Manager at US representing 2 major Indian IT companies. During this time I’ve witnessed myself of such practices by both these companies. But are these companies willingly practiced any racism? The honest answer is ‘No’, the actual problem lies in their business model that was part forced by their clients. This is a first hand account of what happens at and practiced by the Indian IT companies.
The Indian IT industry is predominantly dependent on US market and their largest accounts are invariably US corporations. Initially the Indian IT Companies started as body shoppers i.e. they just supplied talents based on demand. With the opening up of Indian economy, availability of larger talent pool and a giant share in the H1B and L1 visas they started moving up in the value chain. Rather supplier of talents for contract, they started competing for and taking over the end-to-end delivery, program and project managements. From talent supplier we have become trusted partners of the US corporates.
Before the outsourcing started, most US Corporations were managing IT projects with their own talent pool of IT staffs. But these staff were aging and not raising up to the challenges of fast changing technical landscape. During 70’s or 80’s a person could find a steady work for 30 years knowing one of the programming languages like COBOL; but now one is considered redundant if he didn’t learn or work on a new technology in the previous 4–5 years. Even to upgrade a simple system their employers have to train or hire temporary service when something fails, both scenarios works out to be very expensive and time taking. The Corporates are also finding it difficult to fire or replace them either. So they find outsourcing to Indian IT Companies a win-win solution. Whereas the Corporations retain a minimal IT staff and transfer the implementation and maintenance work to their Indian IT Partners along with their own staffs in that area. Thus the risk of upscaling technology and employing properly skilled resources is now shifted to an expert who can easily manage through their vast resource pool. For the IT companies, outsourcing and delivery programs gets them a large foot hold, assured business and super charged growth. Responding to the market and technical innovations is now much quicker with less over head for the corporates. That being said, there is no denial the clients exploit the Indian corporates and who in turn exploits Indian/South Asian labors (Programmers).
Delivery responsibility is very complicated. The companies (both the clients and IT partners) are working at a rapidly changing market, with stiff competition. To meet time, cost and profit (quality is often the last concern) goals the delivery partner require talents who are:
- willing to work beyond 8 hours — usually about 10–14 hours a day, sometimes even on weekends, but still willing to take 8 hours payment;
- work at flexible hours as these projects usually is executed out of offshore, so the onsite talent should have an overlap time with their offshore counterparts;
- ready to onboard or off board with a short notice and willingness to relocate to any part of the country — client must respond to his market conditions so there will be project ramp up and ramp downs at any time. The delivery partner should have capability to increase or decrease his talents and move them around anytime the client asks.
Only the Indian and other South Asian programmers are eager to work on these conditions. Of course they too run away the moment they get Green Card. In a pressure to keep costs low and efficient work planning, the clients have put lots of SLAs and metrics which are very difficult to meet with regular work hours and estimated effort. Over the years clients have smarted up and started hiring ex-employees of Indian IT companies with Green Card who is very much aware of the game plan of their ex-employers. Now the incentives of these Indian hires is tied to the amount of IT expenses they saved for their new bosses — with the intimate knowledge of the working culture of Indian companies they make it even harder. There had been several occasion where my clients (read Managers of Indian origin — both geography and previous work experience) spell out the excuses I was planning to tell them and suggested how hard I could be on my offshore resources or make use of bench resources for free.
For example, I had my team working on a rather bad project — we didn’t have sufficient resources with the required skillset so we were making our resources working almost 24 X 7 those days. Then due to HR policies and seer desperation we hired a local Programmer who had most of the required skills. The project was managed by an Indian Manager from Client side who would like to micromanage the progress. Like we all feared this local hire didn’t agree to the stiff timeline and extra work without overtime (BTW most of our contracts with clients will not have an overtime component, even if it was there it was seldom used). Also he wants to leave everyday at 5:30 PM local time as he had to setup a part of his house that was rented to AirBnB. Of course this doesn’t work with our company or to the client. Needless to say we released him from project within a couple of weeks. Since the resource was released within a month due to performance the client doesn’t have to pay and we have to shoulder that cost as well.
I’ll call the practice as ‘Preference’ rather ‘Racism’ as Indians and South Asians are preferred by the Indian IT companies. It is the amount of work get done by Indians and the flexibility they offer couldn’t be expected anywhere else. Since this is done with the tacit knowledge and understanding of their clients, this practice of preference will prevail.