. . . continued from Hot News But what is the net effect of reducing design, development and production costs by some enormous factor—say, 15% or more? Fifteen percent. Shouldn't there be a something besides a corresponding increase in corporate profits? When the internal cost reductions are so gross as to be remarkable, shouldn't consumers benefit from retail price reductions as well? We've been watching and listening to the news since 2000, blaring stories about technical support and order desks belonging to U.S., Canadian and British companies, being outsourced to Kuala Lumpur, India, Philippines and several other countries. In North America, the Canadian and Mexican economies seem to be doing well, but the U.S.—Iraq, Afghanistan and the war on terrorism aside—seems to be struggling in a morass of unassailable debt. Costs are high in the U.S., but there's a North American Free Trade Agreement that has allowed a lot of auto manufacturing to move to Mexico and its comparatively ultra-cheap labor market. So why are all of those made-in-Mexico cars the same price as the made-in-U.S.A. vehicles? Is it because of cost averaging? Full cost accounting? I can understand that for sure. In any case, the benefits accrue to the shareholders and the executive offices, not the consumer buying one of the vehicles. Quality is poor. Robotics don't solve all problems.

My needs, your needs, and the needs of consumers of professional software have to be represented by people on the design and development teams who thoroughly and completely understand those realities.

I got a call just the other day from a friend who works for a well-known graphics software company. It seems this company is making a precipitous decision. In fact, the company is apparently closing down one of its key groups and outsourcing that group's core experience, specialities and expertise to a sub-contractor and company subsidiary based in India. Apparently, the company is moving a number of other units to India as well. A rough calculation seems to indicate that the net effect on the company's coffers will be to retain roughly 30 million dollars in net revenues annually. And what will that do to the price of the company's US$650 software products?

Not a damn thing I'll bet.

The big corporate outsourcing or off-shoring secret is that every dime saved is another dime in the corporate accounts. Consumers get nothing from these efficiencies except poor technical support in place of the passable support which existed before. Similarly, consumers get nothing in the way of product improvements because the legacy of product development is invariably lost once the development is moved so far away that the vast majority (if not all) of the experienced team members can't migrate with the product.

This is serious.

My needs, your needs, and the needs of consumers of professional software have to be represented by people on the product design and development teams who thoroughly and completely understand those realities. How can a design or development group in India understand my needs in North America? Intelligence aside, environment aside, and my multicultural populist leanings aside, Indian business people doing business on the sub-continent, do not understand my needs in a marketplace which extends from Canada and the U.S. to the UK and Germany. They don't get it and I don't expect them to. How could they? The national culture in India colors everything, just like the national cultures in Canada, the U.S., the UK and Germany color everything in those places too.

The disconnect is here. We notice the apathy, the lack of urgency and the general lack of western conceptual sensitivities every time we talk with tech support in India. On the other hand, Indian friends and business associates of mine in the U.S. and Canada are completely different people in terms of their thinking, sensitivities and responses. They were born in the west, raised in the west and some of them can describe my needs better than me (and vice versa sometimes)! That is genuine understanding born out of common needs, common interests and common desires.

If the first rule of all software development is to know your eventual end user, that graphics software maker has just broken it. Product design and development economics applied for their own sake, without a wise and practiced eye turned toward the consumer of the products, borders on insanity. Owning bragging rights because you managed to cut the most without quite gutting the flagship products is a false economy mainly because such wildly inappropriate stinginess is unsustainable. Sooner or later, usually sooner, the lean, mean machine starts to break down. When that happens 10,000 miles from your primary markets, disaster follows.

I've been asked to keep the name of the company confidential. I will—for now. But if more large companies start to move not only tech support and order desks but design and development too, I will lead the damn uprising to boycott the products. There's always something just as good or better waiting in the wings. Who would have thought that Google could take over the web? Apple survived more than a decade of decline in the face of Microsoft's hegemony. Has Picasa knocked ACDSee off the top of the hill? I think so. Will Corel, with Paint Shop Pro, some day beat up Adobe? It might if Adobe decided to move some of its development operations to hell knows where. Corel moved WordPerfect development out of North America and it's deeper in the 2nd rate swamp than ever before, with brittle code and the absolute need for a complete re-write that may never, ever take place because the product is too expensive to redevelop, but far too complex for long distance management of a massive development group in India (or wherever). Catch-22. Something always dies, in this case a great software product.

At the end of the day, if you want my $650, you better speak to me with a user interface, a feature and function set that works properly and without fail, and provide me with technical support that is responsive and reactive. Fail to do that and I will simply take my money elsewhere. If you can't give me $650 worth of product, don't you dare try to fake it. I will find out and I will kill the product on my system and on every system over which I have control. I want my money's worth.

Caveat Emptor!

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