Sunday, March 07, 2004


Times of India, Mar 06, 2004

I am on a visit to the United States , and I am appalled by the ugly sight of America turning protectionist over the migration of white-collar jobs to India . I can feel the rage on websites like, created by people who have recently lost their jobs.

John Kerry, the Democratic candidate for the presidency, calls American companies traitors who send jobs offshore to India . CNN’s respected nightly business programme greets every announcement of lost jobs as though it were a terrorist attack. Amidst this pressure, the American Senate has passed a bill forbidding the outsourcing of federal government contracts overseas. Many American states will probably follow suit.

The legislative action is not a serious problem, however, as it affects only government business, which is less than two per cent of potential US business. And in the end, I believe, market rationality will prevail in America . Just as Indian swadeshis could not stop Pizza Hut, and Americans could not stop Japanese cars in the 1980s, so protectionists will fail once again. As long as Indians are adding genuine value to American companies, economics will trump politics.

Meanwhile, this controversy has provided an unexpected bonus to India : it has made thousands of medium and small American companies suddenly aware of India . They are wondering if they shouldn’t also begin to save costs by sending their work to India . It would have cost millions in advertising dollars to achieve this level of awareness. Not surprisingly, this controversy has also lifted India ’s image. Americans, who used to think of India as a land of poverty and spirituality, have now begun to see Indians as competitors for jobs in the global marketplace. A competitor is someone you fear and admire.

American politicians talk about losing jobs because of ridiculously low Indian salaries — "at a fraction of the cost" is the fashionable phrase. But American companies tell a different story. "Sure, it is cheaper — that is why we offshored in the first place — but it is the quality that keeps us there," said a company executive to the NBC reporter. American companies report that offshoring not only saves costs, their customer service improves, and they can prove it with market research surveys.

This is the real challenge before Indian companies. In some cases the quality of Indian service has failed. So far, these were exceptions. But companies who want to succeed and grow in the global service economy must not only teach the right accent, they must inculcate an ethic of service. This is a different kind of education from what we are used to — it’s about caring for the customer.

A successful Indian call centre employee says that she learned to care about customers from her father’s lessons in karmayoga, which teaches how to diminish your ego and act without thinking of your reward. This idea is not as far out as it may sound: Indian BPO companies might create competitive advantage by training thousands of karmayogis in order to win in the global service economy.

It is easy to shrug off the political controversy in America as the rhetoric of democracy in an election year. But what is disgraceful is the assumption that Americans have a God-given right to middle class jobs. Americans have long preached the virtues of capitalism and free trade, but they are now fleeing the party because the shoe is beginning to pinch. They have to get used to the idea that capitalism and free trade works for Indians as well.


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Not surprisingly, this controversy has also lifted India ’s image. Americans, who used to think of India as a land of poverty and spirituality, have now begun to see Indians as competitors for jobs in the global marketplace.

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