1. CIS 310 Management Information Systems The IT Workforce
This is Ruth Guthrie presenting a module on the IT Workforce.

2. Everyone’s an IT Worker
Computing is ubiquitous.
Every job will require some use or understanding of computers.
The key to success will be in understanding:
what you need
how to get it
how to intelligently interpret the results
It’s a complex world of data and most people do not understand it.
For some time now, everyone has been an IT worker. Even if people do not traditionally think of themselves this way, it is hard to imagine a job that doesn’t require you to work with a computer system in some context. So, welcome to the world of IT. If you’re not an IT worker in the classical sense, understanding technology can only help you. People are very afraid of technology. It is scary and hard to understand. At your job, if you’re the person who does get it, it adds to your value and can create opportunities for you.
Think about it too. When learning a new technology, it may have been difficult at first but, when you figured it out, wasn’t it pretty easy. Once you understood the underlying purpose and how to operate the system to get what you needed, the difficultly probably wasn’t too immense for you to overcome. I encourage you to embrace technology and try new things continually. Then everyone will think you’re a genius. Young people are very well set up to do this because they do participate in so much technology related activities, particularly through a smart phone.

3. IT Workforce
.Bomb (2002) – IT stocks plummeted and there were lots of IT layoffs.
Outsourcing (2004) – Panic that all IT jobs would be overseas. (Help desk and programming)
Great recession (2009) – Sub-prime Mortgage Crisis. IT jobs are a little more resilient than others.
In the more traditional sense, the IT workforce hasn’t existed all that long. It wasn’t until 1962 that the first undergraduate degree in computer science was awarded. In a college of business, the first year that computing was offered was 1989.
Computing jobs thrived and were even mor$8 a share. Stock in Cisco dropped by 86%. Amazon’s stock went from $107 per share to $7. Many companies simply didn’t make it. I spoke with some alumni who graduated that year and they said they were standing in the line for graduation looking at each other. No one had a job offer yet. They all found successful careers but, what a tough time to go into the job market.
The next dark moment in the IT job market was with the tremendous fear of outsourcing. The fears about outsourcing still exists. If you followed any of the recent presidential election, clearly, perceptions about outsourcing and US job loss were an issue for voters. But, the resilient IT workforce has become great managers of outsourcing projects. Outsourcing continues to be an option for companies seeking lower cost. But, it doesn’t dominate most of IT work.
Now, starting in 2009, the great recession, continues on with a very poor job market. It has been a tough time for college students and for recent graduates. Finding work is not as easy as it once was. However, it is easier if you have a college degree and it is better too if you’ve got some work experience or an internship when you are looking for work. Having some IT skills on your resume can only help you.

4. Technology as Job Killer
Banks – How many tellers do you need to run a bank?
“Facebook, LinkedIn and Twitter together have less than 6,500 employees.” (Forbes, 2013)
Fears of technology and job loss have existed for years. People have a reason to worry.
However, tech is a job engine too. Many jobs exists that we didn’t have before.
Think about it. If computers automate everything, doesn’t all the massive automation we have mean less people will be employed?
At a bank, there used to be lots of bank tellers to help people deposit checks and make withdrawals. Now, there are very few tellers that work in the bank, compared to what there used to be. Automation of transaction processing at the bank, clearly led to job loss of bank tellers. Anything where people can self-serve using technology reduces the need for clerks and tellers.
Some giant technology companies run beautifully with a very small workforce too. “Facebook, LinkedIn and Twitter together have less than 6,500 employees.”
But, technology creates jobs too. Companies, founded a short time ago, are now market leaders. Jobs that no one had ever thought of are now possible because new technologies need people to work with them to make profits.

5. Technology as a Job Creator
Cool ‘Tech’ Jobs, 5 Fast Growing Careers that Pay Well, David Schepp, AOL, 6/1/12.
Social Media Manager - $68,500, 56% more listings for this job title than last year.
Data Scientist - $78,500, 82% growth in job listings
Mobile App Developer - - $88,000, 60% growth in job listings
Cloud Architect - $100,000, 92% growth in job listings
Search Engine Specialist – $65,000, 15%
I’m sure you see these pieces all the time when you are online. Career reports, telling you the hot job prospects for the future. The top 5 jobs identified in this AOL article are careers that didn’t exist too many years ago.
Social Media Manager - $68,500, 56% more listings for this job title than last year.
Data Scientist - $78,500, 82% growth in job listings
Mobile App Developer - - $88,000, 60% growth in job listings
Cloud Architect - $100,000, 92% growth in job listings
Search Engine Specialist – $65,000, 15%
Again, Data Scientist is pretty much brand new. The other job titles have existed only a very short time. So, while technology expedites processes and is fabulous at replacing people doing transaction processing, it is also the engine for new, creative jobs.

6. Skills to Help Future Workers
Administrative Assistant needed for busy Midtown office. Hours are Monday through Friday, nine to five. Job duties include: filing, copying, answering phones, sending s, greeting clients, scheduling appointments. Previous experience in an office setting preferred, but will train the right candidate. This is a full-time position with health benefits. Please résumé if interested. Compensation: $12-$13 per hour.
Network
LinkedIn
Professional Organizations
Personal Contacts
Keep Learning / Be Flexible
Embrace New Technology
Work on Verbal and Written Communication
So in job searches today, with massive connectivity and hundreds of resumes for every job, it is really important to take a pro-active.
One journalist in 2012, listed a part-time job on Craigslist:
“Administrative Assistant needed for busy Midtown office. Hours are Monday through Friday, nine to five. Job duties include: filing, copying, answering phones, sending s, greeting clients, scheduling appointments. Previous experience in an office setting preferred, but will train the right candidate. This is a full-time position with health benefits. Please résumé if interested. Compensation: $12-$13 per hour.”
This ad was posted on the New York City Craigslist. In 20 minutes, there were 56 applicants. In a 24 hour period, there were 653 applicants.
This is a really tough job market.
The importance of networking has never been greater. If you have someone carry your resume in to a potential employer instead of being added to a stack of 653 resumes, your chances of getting an interview are much greater.
Staying on top of your field and networking with professional organizations in your discipline is also a great way to network and find jobs.
It is also essential that you keep learning new technologies and learn to accept change and be flexible. Being able to understand and use new technologies effectively can make you stand out at work and help boost your career.
Lastly, as we’ve talked about before, communication is everything. If you cannot articulate your ideas and share your knowledge, no one will know what you have to offer.

7. End Who it the best teacher you’ll ever have?
How do you stay current in your field?
Does doing an internship help with you with finding a job?
You are. You have access to many resources and you should keep learning new things.
Professional meetings, trade magazines, on the job training (OJT).
Quiz Time
Who is the best teacher you’ll ever have?
You are. You have access to many resources and you should keep learning new things.
How do you stay current in your field?
Professional meetings, trade magazines, on the job training (OJT).
Does doing an internship help with you with finding a job?
Of course. It does look good on your resume. Also, an estimated 69% of companies hire their interns.
Of course. It does look good on your resume. Also, an estimated 69% of companies hire their interns.

8. CIS 310 Management Information Systems Sourcing
This is Ruth Guthrie presenting a module on Sourcing or what you’ve probably heard called outsourcing.

9. The Ginea Pig Diaries, A.J. Jacobs
“My Outsourced Life”
Fighting with the wife
Bedtime stories
People seeking publishing opportunities
A.J. Jacobs is a famous author of books where he is the actor in a social experiment. Like only telling the absolute truth for a month or posing as a beautiful woman over for a month.
In one of his books, Guinea Pig Diaries, he decided to try to outsource his life. He often had frustrating interchanges on and office politics. So, he advertised in India to have someone handle his correspondence. He hired two people, Honey and Asha. Here is a sample letter from the book. Jacobs wanted to write an article for Esquire on modern day gold prospectors and his boss had not responded.
“Mr. Granger,
Jacobs had mailed you about the idea of “gold prospecting.” I am sure you would have received this mail on this. It would be great if you could invest your time and patience on giving thought about his plans. Do revert and let Jacobs know about your suggestions on the same. As you know that your decision would be accepted with utmost respect.
Jacobs is awaiting your response.
Thank you, Honey Balani”
It is a very sweet request for a response. Jacobs loved it because his boss couldn’t just give him a flat out ‘no’. As the month progresses, AJ Jacobs has Honey do more correspondence, handling rejections of other authors submitted work and feeling happy that he didn’t have to directly give bad news. He also had Honey apologize to his wife and read his child bed time stories over the phone. In this sense, I’m sure anything could be outsourced. Honey was very successful because she had remarkable tact, created a buffer between the corresponds and perhaps because she wasn’t so invested in the relationship or the outcome, she could give frank, meaningful feedback in a way that AJ Jacobs could not. He very much loved his outsourcing experience.

10. Outsourcing
Outsourcing: When a company hires out work that they would normally do themselves.
Multinationals are not traditional outsourcers.
Apple’s manufacturing is outsourced to China.
According to Wikipedia, outsourcing “is the contracting out of an internal business process to a third party organization. “
Yet, outsourcing is a little misunderstood. Many companies are multi-national and have organizations in other countries that hire people from there. That is known, as being a multinational company, not outsourcing. McDonalds isn’t going to hire Americans to work their franchises across the globe because that doesn’t make sense.
Classical outsourcing is more like Apple sending all of it’s manufacturing to China. It is also when companies hire ADP, Advanced Data Processing, to do their payroll. Companies love to hire ADP to handle payroll because it is cheaper and performed better through outsourcing. It is still outsourcing even though ADP is an American company. Similarly, Apple’s outsourcing makes it much cheaper to make a iPhone. A Chinese factory worker makes $2 an hour. Apple has come under a lot of scrutiny for working conditions in China. Steve Jobs was notorious for saying that Apple goes to China because there are skilled workers there and he could not find enough skilled workers in the United States. I think that rings a little hollow when you see how little the Chinese workers make and what the working conditions are.

11. Types of Sourcing
In-sourcing – work done ‘in-house’ by the company itself.
Out-sourcing – hiring a company external to yours to perform the development or service
Off shoring
On Shore - in your own country
Near Shore – close to your country
Far Shore – far away
There are many sub-categories of sourcing that scholars have come up with. Three types of sourcing are:
In-sourcing – work done ‘in-house’ by the company itself. Hiring the IT department to do some development work for your department is an example of in-sourcing. We call this, ‘business as usual’. It is using your own company to perform the work: manufacturing, accounting, IT …etc. It is done by people employed by the firm.
Out-sourcing – hiring a company external to yours to perform the development or service. This would be like the ADP example given earlier. Many companies hire ADP to handle payroll because ADP is an expert, it is all they do. Consequently, it is cheaper and has higher quality for some companies to outsource payroll.
Off shoring – is what we traditionally think of as outsourcing. It is sourcing work, processes or development of products to another country.
On Shore - in your own country. This is sourcing to a firm like ADP.
Near Shore – refers to sourcing to a country that is geographically close. For us, that is Canada and Mexico. Advantages to near sourcing are that you can easily visit and communicate with the company your sourcing too. Communication weaknesses are thought to be less than when the country is far away.
Far Shore – refers to when the country is geographically remote from the country doing the sourcing. For us that is China or India. If the product is digital, then the processes and products may not be too difficult to distribute between the two companies. The biggest advantage with far-shore sourcing is cheap labor.

12. SourcingLine.com (Top Outsourcing Countries)
SourcingLine.com publishes a list of four categories, ranked on a 1 to 10 scale. The categories have several sub questions that managers answer regarding attractiveness of other countries for outsourcing business processes.
The country with the highest ranking is India. It has an overall score of 7.1, cost competitiveness is rated 8.3, the skill index is 6 and the economic environment is rated as 4.2.
Indonesia is quite similar, except in skills index, they are rated 4.3.
Singapore is rated 9.4 in its economic, environment index. Sourceline also reports that Singapore is attractive as a sourcing nation because the quality of what is produced, the infrastructure and it’s proximity to asian markets.

13. When to Outsource or Offshore
Cost savings.
Need for an expertise that you don’t have - accessible, trained labor force that you don’t have – shorter time to market.
Free up resources internally, focus on key business area and outsource other things.
Tax Avoidance
Firms get a tax credit for taxes they pay in other countries
Tax rates in other countries are lower (Ireland is 12.5% compared to US 39.5%) (eHow, Roberts)
If a company is considering outsourcing, here are a few reasons they might decide to do it.
Cost. I was trying to look in Wikipedia for the average income in some of the top outsourcing countries and none of them made the list in the encyclopedia entry, they were all too low. China and India have giant populations of poor people. These statistics are from 2004, so they are a bit dated but, they do illustrate the potential for cost savings. The US salary range in 2004 was reported as $60,000 to $90,000. In China it was $5,000-$9,000, while India it was $6,000 to $10,000 (Yourdon, 2004).
With a sourced company, there is no burdened cost for healthcare or retirement either, so the savings in cost can be very large. If the project takes a turn for the worse, it may be easier to fire outsourced employees than those employed directly by the company. There is no severance pay, though the company might have to stick to the contractual terms the negotiated at the beginning of the work.
Outsourcing can also provide skills that a company might not have. If a company wishes to go big into 3D movie development but, cannot find enough programmers, technicians and graphic artists to make Toy Story 10, they might outsource the work to a country that has a labor force ready to go. This might give them a high quality product and a shorter time to market.
Another advantage of outsourcing is that it can free a companies resources to focus on key business areas. For example, if a companies key function is the discovery of new pharmaceuticals, they may be willing to outsource the manufacturing and keep the research and development in-house. After the drugs are developed and approved, the company can let go of that initiative and focus more closely on research and development of future products. Companies need to seriously consider what they are willing to give up and what strategically, they need to hang on to, as their core business area.
It may also be advantageous in payment of taxes. Firms that outsource to other countries pay taxes in those countries and then get a tax credit from the United States. Tax rates are typically lower in other countries too. Irelands corporate tax rate is 12.5% compared to the 39.5% rate in the United States.

14. What to Outsource or Offshore
Call Center
Data Entry
Software Development
Engineering Services
Healthcare Services
Financial Services
Research and Analysis
If you ask our author AJ Jacobs, what can be outsourced, he would tell you ‘everything’.
In business, the top things that companies tend to outsource are:
Call Center
Data Entry
Software Development
Engineering Services
Healthcare Services
Financial Services
Research and Analysis
Something like a call center is easy to outsource. It can give a company skilled workers at very low cost and enable them to have 24x7 call centers.
Activities like data entry and form processing, transactional types of functions, are also good for sourcing because there is not a great deal of complexity in what is required. However, these jobs are at risk of being automated by self service.

15. Outsourcing Decision Matrix
Low High
Form a Strategic
Alliance
Eliminate
Outsource
Retain
Strategic Importance
This outsourcing decision matrix, is a tool to determine what types of business functions should be outsourced. The y-axis lists strategic importance from low to high. The x-axis shows the contribution to operational performance. Strategic vs. operational.
If an activity is of low strategic importance and doesn’t contribute to operational performance either, why do it. These are things a company should consider simply eliminating.
If an activity is of high strategic importance and low operational performance, perhaps it is a function that could offer an advantage by forming a strategic alliance or re-engineer that activity to be of higher operational performance. Aftermarket sales is an example of this. Having another company that could sell extended warranties to existing customers may boost sales and customer satisfaction in an area that the company is not entirely staffed to cover.
If an activity is high in both strategic relevance and operational performance, it might be best to retain that activity because it is something that the company does well and needs to keep their strategic advantage in. It is the key business function that gives the company identity and makes it profitable. Sharing that type of activity reduces a companies strategic edge.
Lastly, something that is low strategic importance and high in operational performance may be an opportunity for outsourcing. Helpdesk is a great example of this. The strategic advantage of a helpdesk is low. While a company wants to provide excellent service and support to their customers, phone help isn’t going to create massive strategic advantage in selling new products or services. Hiring out helpdesk services to someone with proved performance, that can have a great call closure rate at low cost, is a way to save money and potentially improve quality.
Low High
Contribution to Operational Performance

16. Problems with Outsourcing
Contract management
Switching costs
Not supported by insourced employees
Less control over quality
Communication
Complexity = Longer Delivery Times
Threat to competitive advantage
Loss of confidentiality
Problems with outsourcing include:
Contract management
Switching costs
Not supported by insourced employees
Less control over quality
Communication
Complexity = Longer Delivery Times
Threat to competitive advantage
Loss of confidentiality

17. Counterwave Outsourcing
Counterwave-Outsourcing - Bring back work that you had previously outsourced
Supply chains were too complex to unbundle.
Advancements in tech eliminated need for outsourced jobs.
Dissatisfaction with quality, communication.
Deloitte Consulting survey (2005) – ¼ of the firms with outsourcing strategies reversed.
Of course, not everyone has a successful experience outsourcing. Sometimes, outsourced projects are failures or do not meet the expectations of the sourcing company.
The current trend, in fact, is away from so many sourcing contracts. This is termed counterwave-outsourcing or reshoring. Several US companies found that their supply chains were very complex and that outsourcing did not offer advantages in getting products to market more quickly.
Firms also found that jobs they originally outsourced became obsolete and were eliminated.
There is sometimes a dissatisfaction with the quality of the products produced and with the communication between companies in developing products and services. It requires skilled managers that know how to communicate and manager sourced projects.
In a 2005 survey from Deloitte Consulting, 25% of firms with outsourcing strategies had reversed their decisions to outsource.
The Economist, 1/19/13

18. Green Sourcing
Green sourcing reduces these costs by emphasizing local sources for products.
Sustainable procurement & Sustainable supply chain. Using local goods to reduce need for shipping and delivery.
Cloud Computing can be green sourcing.
Creates positive reputation for business.
The last sourcing topic is a new buzz word in business, that hasn’t existed for that long.
Green sourcing refers to reducing costs by emphasizing local sources for products. You’ve probably eaten at a restaurant locally that used food sources from local farmers. It’s more environmentally ‘green’ because the food didn’t have to travel by truck or boat a long distance to get to your plate. It has a smaller carbon footprint.
However, not everything shipped locally is cheaper than purchasing it from another country.
Terms like sustainable procurement and sustainable supply chain are emerging in business literature. The shift to cloud based storage and SaaS, IaaS, PaaS is very much a green sourcing example.
Nicely, green sourcing, and companies seeking to do this, often saves money and builds a positive public image for the company.

19. End What country has the highest rating as an outsourcing supplier?
Name 3 reasons to adopt an outsourcing strategy.
What is the primary reason you might not outsource?
India at Indonesia is the second country at 6.7.
Cost savings, gaining expertise, flexibility.
What country has the highest rating as an outsourcing supplier?
India at Indonesia is the second country at 6.7.
Name 3 reasons to adopt an outsourcing strategy.
Cost savings, gaining expertise, flexibility.
What is the primary reason you might not outsource?
Loss of strategic advantage.
Loss of strategic advantage.

20. References
Joel Kotkin, The New Places that America’s Tech Future is Taking Place, Forbes, 1/10/2013.
David Schepp, Cool ‘Tech’ Jobs, 5 Fast Growing Careers that Pay Well, AOL, 6/1/12.
Eric Auld, Craigslist Experiment, 7/23/12.
AJ Jacobs, The Guinea Pig Diaries, Simon & Schuster, 2009.
Top Outsourcing Countries, SourcingLIne.com, 7/20/12.
Edward Yourdon, Death March, Pearson, 2004.
Wikipedia, Offshoring.
The Economist, Here, there and everywhere, 1/19/13
Roberts, David, The Tax Benefits of Oursourcing.
Joe Christensen, et al., A Practical Guide to Green Sourcing, Deloitte, 11/2008.