Analyst: Expect more offshoring if U.S. tightens on immigration

By Ephraim Schwartz
http://weblog.infoworld.com/realitychec ... edict.html
August 14, 2007

Offshore and near-shore development centers will proliferate, especially in major Latin American companies, Mexico, and Canada, if the U.S. government turns its focus on closing loopholes on H-1B legislation and tightens the screws on immigration to the point where it "almost feels punitive," said Tony Viola, vice president of marketing for North America for Patni, a global outsourcing firm.

Viola had this and plenty more to say in an InfoWorld interview on the future of offshoring.

Despite possible new restrictions and or changes in immigration legislation and regulations, Viola believes that the legislators are "closing the barn door way after the horse is made into glue." By which I assume he means it is too late to legislate stricter immigration policy.

"Globalization and outsourcing are a part of the fabric of U.S. business and have been for a long time," said Viola, who compared it to similar legislation against the automobile at the turn of the 20th century.

"Companies will find a way."

One way that they may find, said Viola, is by investing more in more automation technology that lessens the need to have a service delivery based on a large employment model.

To that end, we are already beginning to see the rapid growth of the SaaS (software as a service) delivery model.

"This is a way to deliver and maintain service offerings without having to have people in a particular location."

SaaS also plays into the H-1B phenomenon. It will allow companies to start putting more time into the tool sets that give them the ability to deliver in an automated way.

"Visa restrictions will push organizations in that direction."

Of course, Viola's conclusion that this isn't a bad thing because it will result in faster delivery, lower cost, and higher profitability for vendors and quicker service cut over from one technology to another isn't shared by everyone.

Someday, companies may automate themselves out of business. If they continue to reduce staff, who is going to be left with a decent salary so that they can buy those goods and services?