Is Dell Reversing Course?
Is Dell Reversing Course?
Date: Monday, November 24, 2003 3:35 PM
JOB DESTRUCTION NEWSLETTER
www.ZaZona.com
Recent news describes a revelation by Dell Inc. that offshoring their
customer service to India might not be such a hot idea after all.
Before we break out the champagne and cheer their new patriotism, let's
look at what Dell is actually saying:
The new U.S. employees will provide phone-based tech support
for business customers, which account for the bulk of Dell's
revenue. Dell employees in India have been answering some of
those calls. Calls from individual customers will still be
routed to call centers in India.
Dell says that it will offer U.S. based support for business customers
only. All other Dell customers will still have to contend with Dell's
Indian customer support. Don't think for a second that Dell intends on
keeping even a small portion of their customer support in the USA. Gary
Cotshott, vice president of Dell's services division said, "Sometimes,
we move a little too far, too fast." Translated, that means that Dell
will offshore those jobs as soon as they can train their foreign
workers with skills comparable to the average American support
personnel. Typically companies like Dell accomplish this training by
importing L-1 visa holders to their US office in order to get learn how
to handle the job. Once they are up to snuff, they will be shipped back
to India. Any jobs created in Austin will be temporary but the job-loss
will be permanent once the nonimmigrants go home.
Steve Felice, vice president of Dell's corporate business division,
said that it's unclear how many jobs the move might create in Central
Texas. The Austin Statesman journalist should have asked how many of
those jobs will go to American citizens because creating jobs for
nonimmigrants won't help the unemployed in Texas.
So just whom is Dell hiring instead of Texans? Over the weekend, I
talked to a Chinese national who was recently hired with an H-1B visa
to work in Dell's Austin division. Xing came to the U.S. on a student
visa, and upon graduation Dell converted the visa to an H-1B. Xing said
that it was easy to get a job at Dell because there are lots of Chinese
friends already working there. Xing winked and said, "Think about it.
They don't call themselves 'Dell Computers', they call it 'Dell Inc.'".
Don't think for a minute that Xing is happy being a Dell H-1B. Xing
voiced numerous complaints about the heavy pressure and long hours at
Dell. Things are so bad that Xing would like to quit in a couple of
years and work for somebody else. I resisted the temptation to inform
Xing that it's unlikely other American companies will treat H-1Bs any
better.
(Xing's name is fictional to protect against Dell retribution)
http://www.newsforge.com/article.pl?sid=03/11/23/0152247&mode=thread&tid=85
Dell brings some tech-support back home
Monday November 24, 2003 - [ 02:00 PM GMT ]
Topics: Business
By: Joe Barr
The Austin American-Statesman reported on Friday that Dell intends to
return most of its tech support to the homeland. According to that
report and others, home consumers' calls to Dell tech support will
still be routed to India but calls for assistance from corporate
customers will once more be handled in the U.S.
As we reported last month, many longtime Dell customers have been
angered by the poor response times as well as poor support offered by
tech support based in India. In that story, we predicted that customers
might revolt, saying, "...it remains to be seen if customers will stick
with Dell (or anyone else) when the service and quality they expect
gets cut. Outsourced or not, short-term savings or not, horrible tech
support is
not going to prove beneficial to Dell in the long term."
It appears that Dell has been hearing the same sort of complaints that
we did. Both language and knowledge seemed to be problems for these
customers. This action by Dell shows they are listening.
The American-Statesman story quotes Dell vice-president of Dell's
services division Gary Cotshott as saying, "We felt a little noise and
angst from our customers, and we decided to make some changes." The
story also asserts that, for the most part, in spite of the backlash
like that reported in our story, companies are continuing to send jobs
overseas.
The Dell move reverses a trend begun at the company when the bottom
began to fall out of the tech market three years ago, and tech support
calls were shifted to less expensive labor markets. It remains to be
seen if this move is a temporary reversal or the start of a new trend.
But in any case, while home consumers will still suffer from the poor
level of tech support resulting from the language and knowledge
problems in India, business customers can rejoice that the hardware
side of the PC cost equation is not a monopoly. If it were, there would
have been no such reversal, no matter how loud the squeals of
complaint.
http://www.statesman.com/business/content/business/dell/1122dell.html
Dell sending some jobs back to U.S.
Corporate customer complaints prompt the change.
By Amy Schatz
AMERICAN-STATESMAN STAFF
Friday, November 21, 2003
In a surprising about-face, Dell Inc. is moving some technical-support
jobs back from India to the United States.
The new U.S. employees will provide phone-based tech support for
business customers,which account for the bulk of Dell's revenue. Dell
employees in India have been answering some of those calls. Calls from
individual customers will still be routed to call centers in India.
"We felt a little noise and angst from our customers, and we decided to
make some changes," said Gary Cotshott, vice president of Dell's
services division. "Sometimes, we move a little too far, too fast."
The computer company's quiet reversal comes as many U.S. companies are
rushing to outsource operations to India and other low-cost developing
nations. It suggests that the savings achieved by moving jobs overseas
may sometimes be outweighed by the cost of antagonizing loyal
customers.
"What (customers) said was, 'You guys have been changing some things,
and we don't like it as much,' " said Steve Felice, vice president of
Dell's corporate business division.
It's unclear how many jobs the move might create in Central Texas,
where Dell operates several call centers for tech support and sales and
employs 16,500 people overall. Dell executives would say only that jobs
will be added at call centers across the United States. Dell's other
U.S. tech support call centers are in Nashville, Tenn., and Twin Falls,
Idaho.
Dell was among the first large U.S. companies to move tech-support jobs
to cheaper Indian call centers when technology spending plummeted three
years ago.
The list of companies sending jobs to India now includes Intel Corp.,
Microsoft Corp., Hewlett-Packard Co. and Computer Sciences Corp.
English-speaking Indian workers are highly educated but earn a fraction
of American salaries. Some customers have complained they can't
understand Indian workers because of their accents and that
tech-support workers rely too heavily on scripted answers.
Despite the escalating backlash, companies continue to send jobs
overseas.
A recent Stanford University study estimates that Indian call centers
have picked up 200,000 jobs since March 2002. Gartner Inc., the tech
research firm, estimates that U.S. information technology companies
will move one in 10 jobs offshore by the end of the year.
Dell's move "doesn't surprise me, but I don't see a broad trend to do
that," said Ned May, an analyst with IDC, a tech research firm.
"There's been so much attention to this that people have moved pretty
aggressively. Hiccups were expected along the way."
Some companies have seen a small but definite decline in customer
satisfaction. Yet executives have concluded that the cost savings are
worth it, said Steve Lane, an analyst with the Aberdeen Group research
firm.
"It's certainly fair to say that there's a general backlash against the
idea of jobs going offshore," Lane said.
Dell executives left open the possibility that tech support for
corporate customers could be shifted overseas again, if technical
expertise and language skills improve there.
"I don't think we're ruling that out," said Jon Weisblatt, a Dell
spokesman.
Nevertheless, Dell's about-face could provide at least a little "I told
you so" comfort for Dell technical-support employees in Central Texas
who were laid off in 2001. Dell cut 5,700 jobs that year, most of them
in Central Texas, as the high-tech slowdown began.
Dell's worldwide work force has grown since then - from 34,600 at the
end of 2001 to 44,300 now - but the growth has been heavily overseas.
In 2001, almost 68 percent of the company's work force was in the
United States. Early this year, that figure had dropped to about 54
percent.
That trend continues: Last quarter, 56 percent of the 2,500 jobs Dell
added worldwide were outside the United States, Canada and Latin
America.
One reason Dell's employment has grown outside the United States is
that the company is selling more PCs and other products globally,
particularly in countries such as China and Germany.
Dell officials stressed that the company will continue to add jobs
overseas as as its global business grows.
Dell's ambition to become a $60 billion-a-year company helps explain
its responsiveness to the complaints of business customers.
The company wants businesses, schools and governments that currently
use Dell Optiplex desktop PCs and Latitude notebooks to also buy
advanced computers, such as servers or storage systems. Dell makes a
bigger profit on those systems, which are supported by techs in the
United States. It can't afford to antagonize its most profitable
customers with poor support for PCs.
"Our corporate customers have come to expect a certain level of
expertise," Cotshott said.
aschatz@statesman.com; 912-5932
http://www.chron.com/cs/CDA/ssistory.mpl/business/2242314
Nov. 24, 2003, 2:26PM
Dell to bring some jobs back home
Cox News Service
AUSTIN -- In a surprising about-face, Dell is returning some
technical-support jobs from India to the United States.
The new U.S. employees will provide phone-based tech support for
business customers. Dell employees in India have been answering some of
those calls. Calls from individual customers will still be routed to
call centers in India.
"We felt a little noise and angst from our customers, and we decided to
make some changes," said Gary Cotshott, vice president of Dell's
services division. "Sometimes, we move a little too far, too fast."
Dell's reversal comes as many U.S. companies are rushing to outsource
operations to India and other nations with low labor costs. It suggests
the savings some achieved by moving jobs overseas may sometimes be
outweighed by the cost of antagonizing loyal customers.
It's unclear how many jobs the move might create in Central Texas,
where Round Rock-based Dell operates several call centers for tech
support and sales and employs 16,500 people. Dell's other U.S. tech
support call centers are in Nashville, Tenn., and Twin Falls, Idaho.
Dell was among the first large U.S. companies to move tech-support jobs
to cheaper call centers in India when technology spending plummeted
three years ago. The list now includes Intel Corp., Microsoft Corp.,
Hewlett-Packard and Computer Sciences Corp.
English-speaking Indian workers are highly educated but earn a fraction
of American salaries. Some customers have complained they can't
understand Indian workers because of their accents and that tech
support workers rely too heavily on scripted answers.
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