Can Agile Slay the Offshore Dragon?

by Ron Hitchens

It's Monday afternoon, the day before JavaOne 2003 begins. I'm here early because I've been house hunting in the Bay Area over the weekend. I just got a call from my real estate agent that our offer has been accepted on the house we've selected. We're all set to move from a large, executive home in Orange County to a cramped townhouse in Fremont, a suburb in the East Bay.

I mention these personal facts to point out that my family and I are gambling on the future of the tech industry in the Bay Area. We lived here during the craziness of the dotcom boom, when recruiters seemed to be stalking me and insane amounts of money were flying in all directions.

But things are different now. Since we moved away a couple of years ago, the tech landscape has become more of a barren wasteland. And recruiters, once so friendly, no longer even bother to reply to inquiries. The ones that are still employed as recruiters are inundated with resumes for every job opening they post.

Since the heady days of the boom, industry expectations have settled back to earth and ROI considerations are once again important to those who hold the corporate purse strings. One of the most significant effects of this has been the inexorable, and accelerating, trend toward offshore IT outsourcing.

To someone like myself, who's been in the computer business for more than a quarter of a century (and always in demand), the prospect of becoming unemployable at 40-something is downright frightening. In the current IT labor market, I'm too expensive to hire. A company can get five people offshore for the cost of one of me.

Now, the standard reaction here would be to call for action to block this trend, legislate against it, restore things to the way they used to be. But, pragmatist that I am, I think that's an exercise in futility. The market does what the market does - it's that simple. The only way to influence the market is to offer a better value proposition.

Some percentage of software development is going to be lost to offshore permanently. We just have to accept that as a given - erecting barriers always ultimately fails.

But will all software development go offshore? Is this the end of the software industry as we know it? I think not. In fact, I think the best stuff will remain here. The fun stuff, the stuff we got into the software business for in the first place.

The offshore operations, of necessity to keep costs down, will become rigidly structured, assembly line operations (if they aren't already). You need an accounting system? Fine they can do that and do it very well. Inventory? Financials? No sweat, done it a million times. But if you need highly customized, innovative, ground-breaking stuff; software that's integral and vital to a new hardware device or business process or biological model or whatever, you need a tightly focused team onsite that can adapt and react and make it work right now.

It strikes me that this pattern echoes the Agile vs. BDUF debate. Offshore by its very nature has a high communication latency and the customer, almost by definition, is disconnected from the development process. This favors the Big Design UpFront approach. For well-understood business processes, like accounting, inventory, etc, this can and surely will work out fine.

But what of the cross-disciplinary innovations that are the lifeforce that keeps high tech so vital? What about the unique challenges that apply only to narrow vertical markets and cannot be easily commoditized? What do you do when the only way to get the software working is to sit down with the guy who invented the widget or the dispatcher who's been scheduling deliveries manually for 35 years? How do you achieve the Ah-hah! moment across 12 time zones?

It's my belief that Agile Development, in one or more of its various forms, will take hold as a way to boost productivity. If an agile methodology can make five local people as productive as 25 offshore, then it once again becomes cost effective to hire people locally. The challenge is to demonstrate the ROI. Agile has to prove itself a superior way of producing results which can't be duplicated offshore.

The transition will be tough and many of us will have to unlearn things we've always taken for granted. I think this may be the beginning of a revitalization of the software industry. Hopefully, it will lead to a better understanding among programmers of the value their work has to a company and how their design choices and develpment methodologies can affect the bottom line.

One thing is certain: we've all got to keep learning and growing as professionals. For me, that's why I got into this business in the first place. I'm optimistic that things will improve and that the tech market in general, the Bay Area in particular, will recover and shake the world once again. This is where the great ideas are born and nourished. This the place where the magic happens. That's why I'm moving back here - I want to be in position to surf the next big wave. I can feel the swells beginning to rise already.

If anyone mentions H1B I'll just scream.


2003-06-10 08:02:04
innovation can

Can Agile methods slay the offshore dragon? No. But innovation might.

You're dead on about cross-disciplinary innovations being the life-force that keeps high tech so vital. But I don't think Agile methodologies are going to save the day. It's akin to rowing faster to try and keep up with a motor boat. What's even more sinister is that this preoccupation with agile methods is actually distracting many otherwise intuitive and inventive people into a bottomless pit of self introspection...the constant drumbeat of trying to test first better, refactor better, pair better, and so on that distracts from the ultimate goal. It's not quite beating a dead horse, but more like sqeezing the last drops out of a spent orange, or perhaps new wine in an old wine skin.

Taylor Cowan
Extreme Programmer

2003-06-10 10:29:54
Can Agile methods slay the offshore dragon?
I agree with much of what you say. But this is what I see. I too am a consultant and have been for some time. Yet myself and others who were educated in the US, have repeatedly had to reegnineer (refactor) "off-shore" developed source.

In many cases once the source was received and implemented, it just did not work. And I was not suprised. I have worked around many programmers who have been trained off-shore and I find that most, are very rigid in their thinking and programming approaches. They are by the book. Many have certifications and have scored high on tests, but, when it came to actually applying that knowledge they fell and still do, fall short.

This is not to say that this will always be. However the mindset of the programmer educated within the US (notice I did not say American) is to "make it work" first regardless of what any book says. This has led to many unique, powerful, innovative and advances in our industry. This is our strength, our ability ourselves to be AGILE and to adapt.

I have seen more "off-shore" learned programmers stick by the book and therefore have problems coming up with innovative and new approaches to increasingly complex problems. Let me say though, "the book" is not bad. Once you know the rules though, then you can push them, break them, reshape them, and/or develop new ones.

This is the same dilemma the US electronics industry has faced for years. In the beginning, American innovation produced the VCR, Microwave, TV, Radio, Transistor, CD, etc. Off-shore companies took the innovation copied it, and just manufactured them cheaper. So now too it has come to pass in the software industry.

And really can you blame companies? Look at the exorbitant prices Oracle, Sun, Microsoft, PeopleSoft, SAP, and others charge for their software! Not to mention the IBMs, Deloitte Touches, and Accentures, of the big consulting world...who bill their clients upwards of $200/hour for non formally trained CS persons, rather, a degreed accountant or business analyst who just went through a 4 week programming bootcamp.

Good programming is accomplished by a developed mind. It is a way of thinking. It is second nature.

As a consultant who has some OEM and Federal Gov. certifications, with 23 years of electronics and programming experience behind me, I have yet to see any CORPORATE software on the market, or consultant, worth what these companies are charging. To me it is just plain old greed.

Until software and consultant companies themselves get with the program, the "off-shore" exportation of projects will continue to grow. However, from my experience, those who have been educated in the US, and have the ability to formulate and apply innovative techniques and approaches to problems via software, will always produce a better quality product and always be in demand.

Personally, as the CEO of a small software development coporation, off-shore will never be a consideration. But then again, we produce our own product.


RP - Kansas City

2003-06-11 10:19:48
I've now twice been involved in projects where we did a complete rewrite of things developed offshore. The reality is that offshore developers may be able to maintain legacy systems, but write new ones? I don't think so. I can't come up with an example of a non-trivial application successfully developed and in production from Indian or SE Asian development.

Companies still choose to locate car manufacturing plants in the US for chrissakes! One of the main reasons is worker productivity. Sure the low-productivity work will go somewhere else, but as you point out, do we really care? All the high-margin work will stay here.

Software engineers will be spinning their wheels chainging professions all the time if they allow themselves to be led around by business journalists who sell magazines by playing on fear.