INDIA AS A OFFSHORING DESTINATION: A HISTORICAL PERSPECTIVE
As debates rage on across the globe on the economics of offshoring work to India
in the IT & ITES space (BPO), it is time to view outsourcing from the
right perspectives. The cost perspective is often harped upon by
both Indian companies and their offshoring clients.
However the root of Indian competitiveness in this space is not
often discussed. This article only offers that historical
perspective on why India is suited to be BPO hub of the world.
"Offshoring" is
the system of packaging a set of your organization's tasks and
hiring another company situated in another country to perform
these tasks for you as a billable service. The service providing
company provides you a dedicated workforce to perform these
tasks for mutually agreed cost and quality terms.
Why India?
The crux of "offshoring" is "cost"
and better operating margins for the companies' offshoring to
India, China or any other country. But "cost" and "predictable &
consistent quality" would be more like it.
India has an edge because you have decent quality English
speaking people who are willing to do routine work ("grunt
work") at a highly competitive price. As long as it maintains
that edge, remains consistent and predictable, India has a place
as the software backyard and the backoffice of the world. A
large IT manpower pool and dominance of English in higher
education system only helps to build India as a preferred choice
for "offshoring".
The reason why India is able to have such consistent IT & ITES
workforce has nothing to do with India becoming a big power in
the IT space or brilliance of Indian programmers or the
fantastic engineers of our IITs. It is a consequence of our
McCaulay system of education which over 170 years old .
McCaulay & India Thomas Babington McCaulay
(1800-1859) was posted in India in the first half of the
19th century (1835 -1837) under Governor General William Bentick
when India was just brought fully under the control of the
British Empire. The British throne exercised control on India
through its agency the British "East India Company". The company
waged bloody battles for most part of the 18th century in India
to control political power and every possible resource in India.
>From 1784 onwards there was a "Board of Control" with members
from the House of Commons which defined the relations between
the Crown and the Directors of the East India Company.
Coming back to McCaulay; Thomas Babington McCaulay, a
master of English prose and literature, was elected twice as the
member of the House of Commons, and served as one of the
commissioners of the Board of Control for 18 months (1831-1832)
whereon he got involved in Indian affairs. The British crown
wanted to appoint a person who was not in the offices of the
East India Company as a member of the Supreme Council in
India. In 1833 McCaulay was appointed to the Supreme Council
of India and traveled to India. By the time he sailed backed in
1837, he laid the foundation for two of the most important
systems which would change India as a country - the Indian Penal
Code and the education system.
The Foundation for English Education
In one of his speeches to the House of Commons in 1833 before
coming to India, McCaulay outlined his plan for perpetuation of
British governance in India through representative institutions
of the government similar to the European model of governance.
This institutional framework designed to manage the British
supremacy required to be staffed with people who understood the
language and the systems. So came up the need for training
Indians to occupy these positions. McCaulay was of the opinion
that Indians were perfectly in position to be trained to staff a
new system of governance. To quote McCaulay "That the
average of intelligence and virtue is very high in this country
is matter for honest exultation. But it is no reason for
employing average men where you can obtain superior men.
Consider too, Sir, how rapidly the public mind in India is
advancing, how much attention is already paid by the higher
classes of the natives to those intellectual pursuits on the
cultivation of which the superiority of the European race to the
rest of mankind principally depends...". This
observation made 172 years back is relevant even today and will
find a familiar echo with many supporters of offshoring to India.
McCaulay outlaid the plans for Indian Education System in the
McCaulay' Minute of Education which was reviewed and
passed by Governor General William Bentick in 1835. William
Bentick agreeing to McCaulay's view concurred that the true
objective of the British government should be the promotion of
European literature and culture in India thus laying the
foundation for a permanent position for use of English language
in Indian education. Today English has come to stay in free
India. Whether the supporters of Indian languages like it or
not, it is impossible to replace English as the medium of
instruction in higher education, language of governance and the
language of technology long after McCaulay and the British have
gone. The medium of instruction in Colleges and Universities
across India is English and will remain so for a long time in
future.
It is this very foundation of English based education rooted in
history that makes it easier for Indians to be a preferred
choice for BPOs and offshoring work from US
other English speaking countries.