AGGARWAL, A. AND PANDY, A. 2004. India's Transformation to Knowledge-Based Economy - Evolving Role of the Indian Diaspora. Evalueserve (July 21).

The article provides insight on the role of the Indian Diaspora (emigrant population), particularly to the United States and the United Kingdom, in the growth of IT offshoring. The article provides a history of the Indian Diaspora since 1834, the size and distribution of the Diaspora, the success of the Diaspora in knowledge-intensive industries in the United States (and, in particular, in Silicon Valley) and, most importantly, the role that the Diaspora has played in the emergence of the Indian IT industry since 1970. Projections are made about the growth of offshoring knowledge-intensive services in the future and the opportunities this presents for India.

AGRAWAL, V., FARRELL, D., AND REMES, J. K. 2003.Offshoring and Beyond. The McKinsey Quarterly 4.

Written by three McKinsey employees, the main focus is on the potential benefits of offshoring that will come through re-engineering business processes and not just by taking advantage of wage differentials while doing work the same way as at home. Approaches for developing nations might include round-the-clock shifts to get the most intensive use out of the relatively expensive capital infrastructure, using less expensive capital equipment that might be handcrafted in the country rather than using equipment from international market leaders, and reducing the use of automation to gain addition savings from low-cost labor. Although not directly pertinent, the paper includes an interesting analysis of cost savings that can come through internationalizing the automobile industry in new ways; this analysis can be applied to some IT industries. A number of other points about the nature of offshoring are made in passing.

ALTBACH, P. G. 2005. Higher Education in India. The Hindu 12 (online edition) (April).

This opinion piece, written by the director of the Center for International Higher Education at Boston College, describes the state of Indian higher education and recommends a set of changes if India wants to have the educational support it needs to modernize itself based on high-tech industries. Seven problems are identified: (1) the higher education system has not been differentiated well enough to form a system with a few elite, research-oriented schools and others focused more on basic education; (2) the underinvestment by the state government in higher education; (3) India only provides higher education to 10% of its young people, compared to 15% in China and more than half in developed nations; (4) the politicization and bureaucratization of the education system; (5) the lack of accountability in the higher education system, providing faculty and administrators with few incentives to perform well; (6) student, and occasionally faculty unrest, which disrupts education; and (7) a large portion of students who leave India for their graduate education, most of whom never return to India. There are some advantages of the Indian higher education system. It has the third largest number of students (after China and the United States); English is the primary language of instruction and research; academic freedom is respected; and there are some quality institutions and departments, notably the Indian Institutes of Technology and the Indian Institutes of Management.

AMERICAN CHAMBER OF COMMERCE IN RUSSIA (ACCR). 2001. White Paper on Offshore Software Development in Russia (March).

This white paper discusses the positive and negative aspects of offshoring software development activities to Russia. Russia's greatest advantage is its highly skilled and educated workforce. Russia ranks third in the world for per capita number of scientists and engineers. Other advantages are labor costs and proximity to Europe and Asia. Some disadvantages include a lack of experience in project management, language barriers, high telecommunications cost, and legal and regulatory challenges.

ANDERSON, C. 2005. Transistors Don't Have Sex on the Roof. The Long Tail 7 (Feb.) (Available at www.longtail.typepad.com).

The article describes the limitations that the author believes offshoring will face in India because of the traditional society. The author argues that the supply of qualified young people who live with their parents in the cities that have concentrations of offshoring companies is already relatively exhausted. Thus, the companies are having to draw their workers from across the country, which separates young people from their families. There are already strong concerns about preventing these young people, who are living on their own, from working with people of the other sex, and working night shifts. To prevent young people from having sex at work companies have locked roofs and guarded parking lots, not to avoid theft, but to avoid sex in the cars. As the cultural backlash becomes stronger, it is expected to limit the supply of workers. There are numerous postings in response to this article.

ARORA, A. AND GAMBARDELLA, A. 2005. From Underdogs to Tigers: The Rise and Growth of the Software Industry in Brazil, China, India, Ireland, and Israel. Oxford University Press.

This volume is edited by economists from Carnegie Mellon and Universita Commerciale Milan. It provides chapters on five countries that produce offshore software services. These chapters describe the rise and growth of the software industries in each of these countries and explain the forces shaping their growth. There are also three cross-cutting chapters. One draws lessons from the histories of the US automobile, tire, television, and laser industries to explain these software industry developments. The second looks at the role of multi-national corporations. The third examines the migration of human capital to and from these five countries.

ARORA, A., GAMBARDELLA, A., AND TORRISI, S. 2004. In the Footsteps of Silicon Valley? Indian and Irish Software in the International Division of Labor. In T. Bresnahan and A. Gambardella Eds. Building High-Tech Clusters. Cambridge University Press, 78-120.

Summary of the book from the publisher. National economic growth is fueled by the development of high technology clusters such as Silicon Valley. The contributors examine the founding of ten clusters that have been successful at an early stage of growth in information technology. Their key finding is that the economics of starting a cluster is very different from the positive feedback loop that sustains an established cluster. While "nothing succeeds like success" in an established cluster, far more difficult, risky, and unlikely are the initial conditions that give rise to successful clusters. The contributors find regularities in the start of the successful clusters studied, including Silicon Valley 40 years ago. These cases contain "old economy" factors such as competencies, firm building capabilities, managerial skills, and connection to markets, more than the flamboyant "new economy" factors that have been highlighted in recent years.

ATHREYE, S. S. 2003. Multinational Firms and the Evolution of the Indian Software Industry. East West Center Working Paper #51.

Abstract from paper. The Indian software industry appears to provide a startling confirmation of the benefits of multinational investment in a fledging industrial sector. The main question explored in this paper is how and why this happened. We find that multinational firms had an important catalyzing effect on the industry's evolution even though foreign firms established by expatriate Indians probably exerted more competitive pressure. We do not accept a popular view which ascribes this benign influence to the development of human capital. We argue it was tight labor markets due to foreign competition which induced domestic firms to both acquire unique organizational capabilities and to improve the value-adding strategies of multinational firms.

BAHL, S., 2005. Is Offshoring Demand Sustainable? Everest Research Institute (July).

A study by the Everest Research Institute (an arm of a consulting firm) and Sanford Bernstein in May 2005 indicate that attrition rates are in the 15 to 20% per year range for global service firms in India and up to 60% for BPO firms in India. Wages were 14.5% higher in 2004 than in 2003. To maintain a good supply of workers (at lower wages), many of the Indian suppliers are selecting for their facilities Chennai, Hyderabad, and Pune instead of Bangalore, Delhi, and Mumbai.

BALATCHANDIRANE, G. 2004. Development of IT Industry in Bangalore and Hyderabad: IT Clusters and the Impact on the Local Economy. In Development of IT Industries and Regional Innovations in BRICs - The Case of India. Asian Institute for Regional Innovation, South Korea (Nov.).

This useful article describes the development of the IT industries in the two most important Indian centers, Bangalore and Hyderabad. The article provides basic statistical information about the cities, revenue of their IT industries, and employment in the IT sector. In the case of each city, the historical advantages for the formation of the IT sector is considered such as educational institutions, climate that attracts IT workers, public and private sector undertaking that led to a science and technology environment, good public schools, community tolerant of outsiders, government policies such as liberalized foreign exchange and tax incentives, and improved infrastructures. The impact of the IT industry growth on attracting other industries to these cities and raising tax revenues is also discussed.

BARFIELD, C.E. AND SAUNDERS, P. 2005. Will Technology Be a Source of Chinese Influence in Asia? American Enterprise Institute for Public Policy Research, Washington, DC. (May).

The presenters were Ernest Preeg of the Manufacturers Alliance and Tai Ming Cheung of the University of California, San Diego. The discussant was Will Martin from The World Bank. Preeg glossed his forthcoming book, The Emerging Chinese Advanced Technology Super State. Topics included export-led industrial strategy, national R&D investment, education policy, foreign direct investment in China, trade trends and policy, Chinese high-tech imports, moving up the value chain in Chinese technological development, the move of Chinese firms from domestic to international players, China as the economic hegemon of East Asia, Chinese military modernization, and US policy responses to China.
Cheung focused on China's dual-use technological base (especially aviation, space, shipbuilding, nuclear technology, electronics, and information technology), its significance for producing military technology for internal use and export more quickly, and its implications for Asia. He assessed the dual-use technology as having pockets of excellence but not generally yet up to international standards. He discussed the Chinese government's efforts to bolster innovation through improvement in education and R&D investment. He also discussed the tension between national direction of technology policy by the government and the many pulls of a free marketplace.

BHARATI, P. 2005. India's IT Services Industry: A Comparative Analysis. Computer (Jan.), 71-75.

The article compares the IT services industry in India with the East Asian electronics and computer hardware industries. Comparisons include revenue growth, networks of suppliers and distributors, supply chains, dependency relations between suppliers and distributors, the role of multinational companies as owners and buyers of suppliers, the role of government in supporting the industry, the focus on quality, and consolidation of the industry into a few dominant firms. The author finds that "With some differences, particularly the absence of multiple supply tiers, India's IT services industry is undergoing a transformation similar to that of East Asia's electronics and computer hardware industries. Currently, this industry is dependent on MNCs [multinational corporations], partly as owners and mostly as buyers, who are outsourcing more IT service operations to remain internationally competitive. MNCs have adopted different production models, with the subsidiary plus IT service provider emerging as the dominant one."

BOO, K. 2004. The Best Job in Town. The New Yorker (July 5).

This is an excellent depiction of life in an outsourcing firm in India. The company, Office Tiger, was founded by two Princeton graduates who cut their teeth on Wall Street. Topics include the infrastructure in the city, the qualification of workers and competition for jobs, business concessions from the government, the nature of the work, the contrast between wealth in the company and poverty in the city, the Americanization of life, conflicts between work and home life, the local political climate, and the expansion of business.

BOOZ ALLEN HAMILTON. 2004. Outsourcing Globally: Trends and Implications of Offshoring for Australia.

This is an instructive analysis of the impacts of offshoring on a nation, Australia, that is likely to offshore work but also set up some offshoring businesses in a few selected industries. Several tables provide useful general information (not only about Australia): The Drivers of Outsourcing, Level of Outsourcing Maturity, Breaking Down Offshoring Savings Opportunities, Advantages and Disadvantages of Offshoring Decision Factors, Level of Offshore Processing. Australia has depended heavily on globalization for access to a wide variety of products and services as well as to increase its markets. Larger markets and larger business inputs have enabled specialization, which, in turn, has increased productivity. While the public outcry against job loss to offshoring has been similar in Australia to that in the United States, Australia is more severely constrained against protectionist measures because of its sensitivity to retaliation, given that its economy is so highly reliant upon exports. Australia has been a popular site for companies that want to offshore financial services because of the language, cultural similarities to the United States, and stronger infrastructure than countries that have lower labor costs. However, there is a likelihood that India will soon topple Australia 's leading position in financial services outsourcing.

BREJA, A. AND MATHEW, M.K. 2005. Inevitability of Innovation in India. Nasscom, (Available at http://www.products.nasscom.org/downloads/ InevitabilityofInnovationinIndia.pdf ).

The article analyzes what drives innovation and how well India is prepared to be innovative. Some of the problems that the authors identify are noted here. The Nehru government stifled competition and risk taking, and the absence of competition stifled innovation; similarly, huge public sector enterprises created by the Nehru government were risk averse. Lack of a good mechanism to govern and protect intellectual property has hampered innovative efforts, led to greater emphasis on re-engineering and reverse engineering than on new product development, and weakened enforcement of contractual agreements which makes for a hostile environment for business investment. The educational system has problems with too great an emphasis on rote learning and applications and not enough emphasis on creation and innovation; and, academic-industrial interactions are weak. Data is not readily available about consumer demographics, industry players, or buying behavior that would enable Indian businesses to make informed judgments about product development. India's banking system has been the principal source of capital for Indian businesses, and these organizations are very conservative in their lending practices, unlike the risk-taking venture capital system that has funded Silicon Valley. India has only a limited number of clusters of firms, suppliers, and customers; this is unfortunate because clusters have been found to be a stimulus to innovation. These and other problems are identified. Some suggestions on how India might overcome them are also given.

CHATTERJEE, S. 2004. South Africa Seen as India's Rival in Outsourcing. Indo-Asian News Service 21 (Nov.) (appeared on Yahoo! India News (Nov. 28)).

This news article summarizes the key points in a study conducted by Datamonitor. The study concludes that South Africa may emerge as a leader in offshoring due to its better infrastructure, low labor costs, and cultural advantages. Datamonitor expects 939 call centers in South Africa by 2008, and the total number of agent positions is predicted to rise to 69,600 in the same period.

CHEN, K. AND KENNEY, M. 2005. University/Research Institute-Industry Linkages in Two Chinese Cities: Commercializing Technological Innovation. Presented at Universities as Drivers of the Urban Economies in Asia sponsored by the World Bank and Social Research Council (May 24-25).

This paper examines the role of universities and research institutes in two Chinese cities, Beijing and Shenzen, which have very different development models. The paper presents historical background on Chinese higher education, research institutions, market globalization policy, and research and development policy. It also gives detailed information about the state of universities, research institutes, and their ties to the commercial sector. In Beijing, there was already a strong higher educational base, and the paper talks about the contribution that the education base makes to technology commercialization through the formation of spin-off firms and the transfer of people from the educational to the industrial sector. Case studies of the Chinese Academy of Science and Tsinghua University are given in illustration of these patterns. Shenzen was a fishing village near Hong Kong that was promoted by the Chinese government for development as a way to relocate manufacturing from Hong Kong. It did not originally have any universities or research centers, but incentives attracted a number of universities to establish graduate programs there. A successful high technology industry has been built up in Shenzen. In Beijing, most of the R&D continues to be done in the universities and research institutes; in Shenzen, most of the R&D is carried out in companies.

CHEN, L. 1999. Reform: China's New Engineering Obstacle. Prism (Sept.). (Available at http://www.prismmagazine.org/sept99/lastword.htm (accessed September 2005)).

A Chinese professor identifies challenges in engineering education for his country. He is particularly concerned about students learning to think creatively. He suggests reforming the teaching content, introducing students to a scientific learning method, modifying teaching plans, speeding up educational modernization, and improving teachers' working conditions and training.

CHINA SOFTWARE INDUSTRY ASSOCIATION. 2005. China Software Export Achieved 7 Times Growth in Five Years. (Available at http://www.csia.org.cn/chinese_en/index/. Accessed March 13).

The brief excerpt quotes Vice Minister YU Guangzhou of the Ministry of Commerce in Beijing who stated that the Chinese Software Industry has developed rapidly in recent years with an average annual growth of 30% on sales and seven times growth on software export for the past five years.

CHINA VENTURE CAPITAL RESEARCH INSTITUTE 2004. China Venture Capital Yearbook 2003. Hong Kong.

Introduction from Webpage. China Venture Capital Yearbook 2003, the 2nd annual series work, is an authoritative & comprehensive reference on venture capital in China produced by a group of prominent business scholars, industry leaders, and government officials headed by Siwei Cheng, Vice Chairman of the Standing Committee of the National People's Congress (NPC), the People's Republic of China. It is one of the feature publications edited by CVCRI in cooperation with Public Policy Research Institute of Hong Kong Polytechnic University, China's Ministry of Science and Technology, Guangdong Venture Capital Association and Shanghai Venture Capital Association. The Yearbook can serve as the most valuable guide in China and overseas for business practitioners, academic researchers, and government officials with a focus on China's venture capital markets to capture latest developments, track on historical data and past records, seek practical insights and ideas, and find and build business connections in the venture capital communities inside and outside China.

CYBERHOOD NEWS 2005. IBM Opens Dedicated IT Services Research Center in Bangalore. (Aug. 18) (Available at http://www.ciol.com/content/news/2005/105081813.asp. Accessed September 1).

Lead from article. In an effort to promote innovation in the IT services arena, Infotech, a major IBM subsidiary, today announced the opening of a research center in Bangalore that would look purely at services. This center, which would look purely at services, would act as the extended arm of IBM's India Research Lab (IRL) located in New Delhi. This announcement comes as the company is on a big hiring spree in India and speculations that IBM plans to cut jobs at other locations and hire thousands more in India. The company already has a 23,000 strong IT services team in the country.

DALIAN SOFTWARE PARK. 2005. (Available at http://www.dlsp.com.cn/english/Investment/inv_Soft.asp).

This site provides information about Dalian Software Park. Dalian is the model city in China for the internationalization of the software industry. The site describes Chinese government support for the park, the software and business process outsourcing industries located there, higher education that is supporting the effort, and infrastructure and policies.

D'COSTA, A. P. 2004. Globalization, Development, and Mobility of Technical Talent: India and Japan in Comparative Perspective. United Nations University, World Institute for Development Economics Research. Research Paper No. 2004/62, (Oct.).

The paper is not directly about, but relevant to, offshoring. The main focus is on how mobility of technical talent changes the relationship between rich and poor countries. The paper considers the movement of highly skilled technical professionals across national borders as well as the role of skilled labor mobility in the process of innovation, and gives specific analysis in the cases of Japan, which has a deficit of skilled professionals, and India, which has a surplus. Particular attention is given to the concept of the "brain bank" by which countries such as India send high-skill workers to other economies that can benefit from its overseas workers.

DEDRICK, J., AND KRAEMER, K.L. 1998. Asia's Computer Challenge Threat or Opportunity for the United States and the World? Oxford University Press.

From Amazon.com. How did the computer industry evolve into its present global structure? Why have some Asian countries succeeded more than others? Jason Dedrick and Kenneth L. Kraemer delve into these questions and emerge with an explanation of the rapid rise of the computer industry in the Asia-Pacific region. Asia's Computer Challenge makes a systematic comparison of the historical development of the computer industries of Japan, Hong Kong, Korea, Singapore, and Taiwan and concludes that neither a plan versus market, nor a country versus company dichotomy fully explains the diversity found among these countries. The authors identify a new force, the emergence of a global production network. Reaching beyond specific companies and countries, this book explores the strategic implications for the Asian-Pacific countries and the United states. Now East Asia is faced with a challenge; they must make the move from low-margin hardware businesses to high-margin software and information businesses, while Americans must respond by maintaining leadership in standards, design, marketing, and business innovation.

DE FONTENAY, C. AND ERRAN, C. 2004. Israel's Silicon Wadi: The Forces Behind Cluster Formation. In T. Bresnahan and A. Gambardella (Eds.) Building High-Tech Clusters. Cambridge, 40-77.

From the paper's introduction. By the end of the 1990s, Israel was generally acknowledged to have developed a cluster of high-technology industries. For instance, Wired magazine (Hillner 2000), ranking locations by the strength of cluster effects, gave the Israeli high-tech cluster the same rank as Boston, Helsinki, London, and Kista in Sweden[, second only to Silicon Valley]. This report describes the reasons why these clusters emerged in Israel and the effect of these clusters on R&D production as well as future implications.

DONG, Y. 2004. The Chinese Experience. In P. Drysdale (Ed.) The New Economy in East Asia and the Pacific. Routledge/Curzon Publishing, London. UK. 130-139.

From Amazon.com. A look at the experience with the new economy in North America, considering technological change on economic process, the Internet, changing business organization, new regulatory issues and there are a series of industry case-studies. [This case study examines the Chinese experience.]

DOSSANI, R. 2005. IT Services Offshoring to India: India's Position in the Supply Chain. ACM Job Migration Task Force Meeting (March 4) Palo Alto, CA.

This presentation discusses offshoring of software services, the stages of growth in offshoring, impact of offshoring on the US economy, India's human resource and other challenges, and the argument that India's IT industry could have developed earlier and been more significant.

DOSSANI, R. AND KENNEY, M. 2005. Pioneering the Globalization of Mental Labor. Work in Progress.

This paper traces the history of the rise of software services as an export industry for India and how it led India into the export of other services, which is one of the country's main connections with the global market. The paper includes a lot of useful information in tables, including:

• global software services spending by categories of work
• trajectory of technological development and the effect on jobs
• the supply chain for applications programs
• trends in software services outsourcing in the United States
• India's share in components of the software services industry
• Employment in the software industry in India and the United States
• India's national champions in IT
• growth of the Indian software industry over time
• Founders backgrounds of the leading Indian firms
• Indian companies that are leading software exporters
• Comparison of work done in US and India, organized chronologically
• Educational levels of software engineers in Indian software exporting firms

DOSSANI, R. AND KENNEY, M. 2004. Thoughts for the ACM Working Group, ACM Job Migration Task Force Meeting. Chicago, IL (Oct.).

This presentation by Kenney at the initial meeting of the Job Migration Task Force discussed destinations for software work, business process outsourcing statistics, wage rates in India, technical enabling conditions and business drivers of offshoring, a case study of type of work sent off shore, analysis of job ads in India to determine types of jobs being filled, impact of offshoring on career ladders and wage depression, and educational issues.

DOSSANI, R. AND KENNEY, M. 2004. The Next Wave of Globalization? Exploring the Relocation of Service Provision to India. Work in Progress (Sept.).

This is one of the best articles written about offshoring and India. The paper sets offshoring in a historical context, analyzes why offshoring is of value to a firm, characterizes the different kinds of firms that are providing offshoring services, describes the strategies and competitive advantages of each type, and speculates on the policy implication and initiatives that are likely to come from developed nations in response to offshoring. The focus is on India, but much of the analysis would apply to any nation providing IT and IT-enabled services (ITES). The paper is informed both by the authors' knowledge of the economic and organizational literatures, and by their first-hand contact with players in the Indian ITES industry.

DOSSANI, R. AND KENNEY, M. 2003. Lift and Shift: Moving the Back Office to India. Information Technology and International Development 1, 2, 21-37.

Abstract from the paper. The recent growth in offshoring business processes is driven by the need for cost savings, but, because of the potential for both the quantity and quality of work that may be done overseas, has larger implications for the service economy in developed countries. This paper uses India as a case study to examine the business, knowledge-related, and technological considerations that drive the globalization of business process fulfillment. It also examines the industrial structure that is emerging in India for the work and draws conclusions about its future and its implications for service workers in developed countries.

THE ECONOMIST. 2005. The Bangalore Paradox. The Economist (April 21).

The article describes the infrastructure and other problems facing Bangalore, which may harm its ability to grow its offshoring business. Problems include the local government not following through on building infrastructure such as the delayed work on the new international-quality airport, a water shortage, inadequate sewers, an erratic power supply, shortage of hotel rooms and quadrupling in the cost over five years for luxury hotel rooms, higher prices than other major cities in India, new business taxes introduced by the city, pot-holed roads, and roads that cannot handle the higher capacity in what has become the fastest growing city in India with a current population estimated at 7 million.

EUN, J-H., LEE, K., AND WU, G. 2005. Explaining the University-Run Enterprises in China: A New Theoretical Framework and Applications. (Jan.) (Available at http://www.ciber.gatech.edu/workingpaper/2005/019-05-06.pdf Accessed Sept.).

Abstract from paper. This paper departs from the critique that both the "Triple Helix" and the "New Economics of Science," which assumes typical situations of advanced countries, fail to provide a satisfactory theoretical framework to address the university-industry relationship in developing countries. The lack of a suitable theoretical framework has resulted in, at least in part, the confusion over the right role of the university and the desirable university-industry relationship in China where universities used to set up and run manufacturing firms (i.e. university-run enterprises, or UREs). In order to fill in the gap in research on the university-industry relationship in developing countries, we constructed a new conceptual framework by synthesizing the "theories of the firm" (especially a Resourced-Base View of the firm) with the literature of the university-industry relationship. The conceptual framework, which consists of macro-level framework and a micro-level one, is based on the notion that the URE could be seen as an alternative governance form of knowledge industrialization. With the framework, we explained why the UREs emerged, prevailed, and eventually began to decline in China. Furthermore, via the concept of "absorptive capacity," we extended the conceptual framework to make it possible to address the "knowledge industrialization (or forward engineering)" along with "reverse engineering" and "inter-firm learning," which are distinct strategies for technological catch-up. Within the extended framework, we contrasted evolutionary paths of Japan and Korea with that of China and drew some policy implications.

EVALUESERVE 2004. Status of BPO Industry: Present and Future. Evalueserve (July 13).

From the report's introduction. This paper focuses on some major countries that will offshore their work and destinations that will receive this work during the next seven years. The scope of the paper is limited to the offshoring of BPO jobs only and does not include IT services. US firm are expected to take the lead in global offshoring, while the Philippines and China are the major destinations that will attract offshored jobs in the near future.

EXPRESS COMPUTER 2002. SISL Grows out of Parent's Shadow. (July 1) (Available athttp://www.expresscomputeronline.com/20020701/company1.shtml. Accessed Aug.).

The article gives a profile of Siemens Information Systems Limited which is a major player in the Indian software industry and a subsidiary of the German-based multinational firm Siemens. The article discusses its various businesses, including healthcare, telecom, scientific applications, graphics products, and business solutions.

FANNIN, R. 2004. India's Outsourcing Boom. Chief Executive (May) 28-32.

This article gives an overview of some of the statistics and issues facing the outsourcing industry in India today. Topics include Bangalore as the leading center, the physical environment of the offshoring firms, various measures of size of the Indian offshoring industry, serious problems with infrastructure, shortage of experienced managers, high job turnover rates, concern about backlash from the United States over job loss, domestic competition for the offshoring business, the importance of a large educated labor force, morale problems in call centers, examples of offshoring R&D.

FARRELL, D., KHANNA, T., SINHA, J., AND WOETZEL, J.R. 2005. China and India: The Race to Growth. The McKinsey Quarterly (July).

Excerpt from Web site. China and India are both developing quickly but with vastly different approaches. China's growth has been driven by manufacturing, and the country's planned economy has tapped into domestic savings and foreign investment to build an impressive infrastructure. India, by contrast, owes much of its progress to private businesses. Without much assistance from the government, they serve companies in the West's knowledge-based industries such as software, IT services, and pharmaceuticals. The difference between the two models prompts debate about whether one country has a better approach to economic development than the other and which will eventually emerge as the stronger.

THE FINANCIAL EXPRESS 2005. India's Threat to Israel's High-Tech Industry. The Financial Express (March 22).

This brief news article describes the impact that India is having on Israel's high-tech sector. The high-tech sector accounts for almost half of Israel's exports and many of its best-paying jobs. Israel is beginning to lose out on price competition to India. Some Israeli companies are beginning to set up operations in India. Trade between India and Israel is rising rapidly as a result. Israel is reported to be ahead of India in business software, semiconductors, communications, and life sciences.

GARG, A. AND SHARMA, A. 2004. How They Did It. BITSAA Technology. (Available at http://www.bitsaa.org/sandpaper/leaders/hukku.htm).

Lead from the article. The company had all the elements of a startup story. An idea for a product, $400,000 in venture financing, zero revenues, one client, a threadbare office, and three passionate founders. The $400,000 in VC money is now worth over $400 million, and the entire company is valued at a billion dollars. Much has been written about i-flex's success as the world's #1 selling core banking software company. But this article talks about the lesser known Rajesh Hukku, the person, and the early beginnings of i-flex Solutions.

HAWK, S. AND MCHENRY, W. 2005. The Maturation of the Russian Offshore Software Industry. Journal of Information Technology for Development (to appear).

From the paper's abstract. In the decade of the 1990's, India leapt ahead of all other competitors for off-shore programming business, giving the impression that Russia had not lived up to its potential. This paper uses case studies of firms and clients and available literature to investigate what Russia has achieved so far, what bottlenecks and hindrances have prevented it from going further, and how those problems are now being addressed. Based on the Heeks/Nicholson and Carmel models, it is concluded that there have been important improvements in domestic input factors, infrastructure, and software industry characteristics; some improvements in linkages with customer firms; and relatively little progress in improving national vision and strategy. The industry has achieved a "platform of maturity" from which further growth is now possible.

HEEKS, R. B. 1999. International Perspectives: Software Strategies in Developing Countries. Communications of the ACM 42, 6 (June) 15-20.

This is an informative article on five strategies used by software companies in developing countries, written by a management professor from the University of Manchester. The article is somewhat dated, and some of the trends may have changed somewhat. Most software firms in developing countries are in the services rather than the product business. Large amounts of development work take place at the client's site by having developers travel to those sites. Most work undertaken by these companies is relatively low-skill software construction and testing. Topics include first-mover advantages of offshoring firms and countries, the emergence of new country markets, heavy expenses for offshoring companies sending workers overseas, opportunity costs of applying highly-skilled workers to external rather than domestic markets, reasons for not developing domestic markets, using domestic markets as springboards to external markets, and strategies that developing countries can employ to build up their offshoring industries.

HIRA, R. 2003. Utilizing Immigration Regulations as a Competitive Advantage: An Additional Explanation for India's Success in Exporting Information Technology Services. Center for Science, Policy, and Outcomes, Columbia University. (March).

This article provides an excellent analysis of the use of H1-B and L-1 visas by the Indian software industry as a competitive advantage. The paper undertakes both macro and micro-economic analysis to explain the importance on these visa programs to the Indian software industry's business strategy. Topics include the various visa categories and how they work, the heavy use of these visas by programming job shops, the importance of these visas to Indian IT firms, the importance of US clients to Indian IT firms, the importance of on-site access in the US for offshore work, current demand for temporary visas, the implications of the slowdown in the US economy on the Indian IT business, changing businesses conditions in the US, policy implications, and likely Indian responses.

HIRA,R. To appear. Does India's IT Industry Need Labor Mobility in an Age of Offshore Outsourcing? In T. Thatchenkery and R. Stough Eds..ICT and Economic Development. Edward Elgar, Northampton, MA.

This chapter investigates the importance to Indian offshoring firms of the ability to place their workers on the site of their US clients. It explains the critical dependence of this strategy on the US H-1B and L-1 visa programs, and the significant continuing revenue that the major Indian offshoring firms earn in this way. The chapter argues that shifting work overseas to countries including China and India has not yet eliminated the value of sending employees of offshoring firms to work on the client's sites in the United States, and it discusses the blended strategies of having both workers in India and the United States. US politics surrounding offshoring and visa programs is analyzed.

HOFFMAN, T. AND THIBODEAU, P. 2004. Wage Inflation Unlikely to Soon End India's Offshore Dominance. Computerworld (April 5).

In this brief article, the authors note that the labor costs are rising at around 13% per year and are thus expected to double by 2010. Despite that, and the fact that Chinese programmers earn 20 to 30% less than Indian programmers, it is expected that India will be the dominant outsourcing destination for some time to come. This is partially attributed to the deep labor pool. Approximately 290,000 engineering degrees are awarded annually in India, the majority in IT fields. Wage pressure exists in India, especially in fields with a shortage of practitioners, managers, and ERP experts.

HOPPERMANN, J. AND PARKER, A. 2004. Debunking Russian Offshore Myths. Forrester Research (June 4).

From the report's executive summary. In parts one and two, we discussed the criteria needed by end users to select a software development partner from a growing group of capable Russian offshore software development specialists and then looked in more detail at the nine companies that Forrester surveyed as representative of the capabilities of Russian providers. This third and final part discusses some of the perceptions and misconceptions that influence client-side decisions in favor of or against Russia - or, to a certain degree, other Eastern European countries - without regard to any specific company.

INDO-ASIAN NEWS SERVICE 2005. SAP India to Hire 2,000 More Techies. (Available at http://www.hindustantimes.com/news/181_1420811,0003.htm Accessed Aug.).

SAP is doubling to 4,000 its engineers in operations in India. The Indian operation serves the growing Indian domestic market. It also works on worldwide products such as the NetWeaver enterprise software.

ISRAELI EXPORT AND INTERNATIONAL COOPERATION INSTITUTE 2005. Presentation on the Israel's Software Industry. (Available at http://software.export.gov.il).

This is a national trade development site about the Israeli software industry for those who want to build business relations with an Israeli software firm.

JOSEPH, M. 001. China Threatens India Eminence. Wired (Feb. 23). (Available at http://www.wired.com/news/business/0,1367,41656,00.html Accessed Sept.).

From the Wired Website: India has long ruled Asia in terms of churning out high-level software professionals. But the Chinese government is going full speed ahead on plans to upgrade its computer, and English-language, literacy. Manu Joseph reports from India.

KATSUNO, M. 2005. Status and Overview of Official ICT Indicators for China. Directorate for Science, Technology and Industry. STI Working Paper 2005/4. Organization for Economic Co-operation and Development (March).

This paper examines the state of statistics about ICT in China and analyzes the current state and trends in ICT in China. The paper does a good job of identifying the various government agencies and the statistics they collect. The Chinese government prevents collection of data by foreign organizations, and most Chinese private organizations base their studies on official government data. The government data is best on infrastructure and Internet use by individuals with some data on supply of ICT. There is little information on demand or on Internet usage. Although there is a software industry in China in the Zhongguancun area outside Beijing, there is little data available on this industry. The report also includes a brief history of the semiconductor, electronics, and telecommunications industries in China.

KRISHNADAS, K.C. 2004. India is Undisputed Offshoring Leader, Report Says. Electronic Engineering Times (March 29) 10.

Reporting on a Gartner Group study, India is by far and away the location of choice for outsourcing, followed by China and Russia. Poland, the Czech Republic, and Hungary are growing rapidly from a small base because of interest by Western European countries in more local offshoring ("near-sourcing").

KUMAR, V. R. 2004. NetScaler to Double Headcount. (June 16). (Available at http://www.thehindubusinessline.com/2004/06/17/stories/2004061702170700.htm Accessed Aug.).

From the article. NETSCALER India, part of the Santa Clara-based application networking systems and solutions company, is set to expand India operations by building upon networking products that it has developed locally and by doubling its headcount at the R&D centre based out of Bangalore.

LACEY, M. 2005. Accents of Africa: A New Outsourcing Frontier. The New York Times (Feb.2).

The article describes the emerging offshoring industry in Africa. Most of the offshoring business has been in call centers, particularly in telemarketing rather than customer service. The English-language call center business has been focused in South Africa and to a lesser extent in northern African countries, but there is emerging call center business in Kenya and Ghana. French-language call centers are being established in Morocco, Senegal, Tunisia, and Madagascar. Some of the same problems are occurring in Africa as have occurred in India, i.e., problems with government bureaucracy and corruption, poor telecommunication and power infrastructures, speaking accents, and cultural differences.

LIU, X. 2004. Technology Policy, Human Resources, and Chinese Software Industry. Strategies for Building Software Industries in Developing Countries Conference. Honolulu, Hawaii (May 19-21). (Available at http://www.iipi.org/Conferences/Hawaii_SW_Conference/Liu%20Paper.pdf).

From the paper's abstract. The competitiveness of the Chinese software industry is relatively weak internationally. This paper discusses three important factors behind this comparatively weak competitiveness: late support from government, language specific industry context and poor education and training systems. But recently, the industry has been pushed in a comprehensive manner and will make a leap-frog in the future.

LIU, X. 2004. Technology Policy, Language and Human Resource Factors in the Chinese Software Industry. Strategies for Building Software Industries in Developing Countries Conference. Honolulu, Hawaii (May 19-21). (Available at http://www.iipi.org/activities/forums/softwareconference/Liu%20Presentation.pdf Accessed March).

From the International Intellectual Property Institute Web site. The growth of a strong software industry is viewed by many developing country policy makers as an essential element in their road to development. Developing countries and aid agencies have thus invested heavily in support of building domestic software industries, particularly by investing in education and technology adoption. While the various measures and programs developing countries have instituted are meant to promote the growth of domestic software companies, they may also have long-term negative effects upon their software industry. Without careful and enlightened policies, the well-intentioned efforts of some developing country governments may stunt the growth of their software companies and in the end do more harm than good. Strategies for Building Software Industries in Developing Countries will bring together experts and software industry professionals from around the world to identify, discuss, and debate the various policy options governments have to cultivate their software industries and what strategies software companies can employ to ensure success in the international market place.

LU, Q. 2000. China's Leap into the Information Age. Oxford University Press, Oxford, UK.

From Amazon.com. This book provides the first in-depth analysis of how four innovative Chinese electronics enterprises - the Stone Group, the Legend Computer Group, the Founder Group, and the China Great Wall Computer Group - transformed the Chinese computer industry over the past decade. It explains how indigenous Chinese business enterprises that grew up during the era of economic reform gained the high-technology capabilities and modern marketing know-how to compete domestically and internationally with powerful foreign multinationals. Through case studies based on first-hand access to company records and personnel, the author reveals how, building on technological capabilities accumulated during the central planning era, the institutional transformations of the economic reform era unleashed a unique pattern of organizational learning and innovative enterprise. The author also draws out the implications of the developmental experience of the Chinese computer electronics sector for understanding the institutional and organizational foundations for a successful transition from a centrally-planned economy toward a market-oriented one.

MAHALINGAM, S. 2005. Tata Consultancy Services. The India Conference - Shaping the Future (Aug.). (Available at http://www.tcs.com/investors/pdf/TCS_Presentation.pdf. Accessed Aug.).

This is a PowerPoint presentation by the company's chief financial officer for investors. It includes information about the company's business areas, global presence, growth strategy, mission and values, and statistics on employee growth and financial status.

MANJOORAN, P. 2004. Two Pillars of the Asian Economy. Canadian Investment Review 17, 2, R19.

Manjooran is vice president, Capital International Research, for Capital Guardian. The article provides a statistical and analytical comparison of India and China as the two main competitors of the future in offshoring. Topics include Gross Domestic Product (GDP) and GDP growth, age and size of workforce, education, cost of capital, infrastructure, political reform, and governance system.

MARCUS, A. 2004. Insights on Outsourcing. Interactions 11, 4 (July) 12-17.

Marcus describes his views based on recent experiences in India and China. The article describes the largest US employers in India, the number of IT professionals, the largest Indian offshore companies, the beginning of the shakeout in the Indian offshore industry through consolidation, the rapid growth of Bangalore, churn in the Indian call centers, software services provided by Indian firms, Indian salaries, the offshoring of creative tasks, and the use of local culture as a competitive advantage.

MARSON, I. 2005. China's Linux Market Grows. ZDNet UK (March 15). (Available at http://news.zdnet.co.uk/software/linuxunix/0,39020390,39191343,00.htm).

This article summarized a report from IDC titled, "China Linux 2005-2009 Forecast and Analysis". The report stated that Linux sales in China sharply increased in 2004 with Linux licenses and maintenance reaching 9.3 million (a 20% increase from 2003) and 1.835 million units (a 3.6% increase from 2003) of the system shipping in 2004.

MASHELKAR, R. A. 2005. India's R&D: Reaching for the Top. Science 307, 4 (March) 1415-1417.

This essay by the president of the Indian Science Congress describes the growing opportunities for scientific research and technological development in India and the importance this has to the Indian nation. He applies Lotka's Law, an inverse square law of scientific productivity, to argue that the flight of Indian scientists to developed nations has been more harmful than the Indian government has believed. He then describes the improved environment for research in India today.

MCCARTNEY, L. 2003. A Shore Thing? CFO IT (March).

To limit exposure to crisis, some companies are choosing multiple outsource vendors in different parts of the world. In choosing the country of an outsource vendor, factors to consider include political stability, depth and availability of technical talent, cultural fit, and status of the country's currency compared to the US dollar. Technological capabilities cannot change overnight, but currency relationships can. Major challenges likely to be encountered by a company in outsourcing include managing communications, managing project timeline or budget, integrating with internal applications and processes, managing change requests and scope of work, negotiating contract terms, understanding the differences among services providers, understanding and quantifying benefits, and getting buy-in from management. Some of the advantages of outsourcing to Canada are skills in the workforce similar to those in the United States, a legal system similar to the United States, travel time is minimal, time zones are the same, and Canada is often price-competitive with other countries in offshoring (so long as the Canadian dollar remains low against the US dollar).

MCKINSEY & CO. 2003. India Information Technology/Business Process Offshoring Case Summary. (Available at: http://www.mckinsey.com/knowledge/mgi/newhorizons/reports/IT_BPO.asp).

From the Web site. For India, with its English speaking, educated, and technically proficient workforce, offshoring is growing at 30 percent per year and is projected to grow to more than US$ 200 billion by 2008. Despite widespread concerns that offshoring eliminates jobs at home, in reality the revenue saved through offshoring is being reinvested at home. As the largest global supplier of offshore IT, India accounts for roughly a quarter of the global market for IT talent. India has added hundreds of thousands of high tech jobs though, relative to the economy overall, the impact to date has been small. Because many of the IT facilities tapped for offshoring already existed, FDI impact has been on increasing employment and bringing higher value-added functions to India. Facilities and infrastructure for BPO, unlike IT, have been created entirely through FDI. The Indian government offers lucrative incentives to attract MNCs but without significant positive effect since MNCs are already committed to establishing BPO functions in India. Government funds lost through tax incentives would be better used to improve the country's infrastructure. Lack of reliable power, for example, poses a major threat to BPO growth. Offshoring of IT and BPO has been a boon for India, and the sector is expected to grow in the years ahead. Numerous new jobs have been created, and higher value-added functions have been brought to India. As international companies enter India, increased competition is beginning to drive sector productivity.

MENON, P. NIIT Draws Up Strategy To Strengthen Its Presence In China. (Available at http://www.niit.com/ILB/India/asp/articles/NIIT-China-article-prakash-menon.rtf Accessed Sept.).

The article discusses the rapid growth economically of China and the importance of IT as a driver. Statistics are given for growth in the Chinese hardware and software industries. IT training in China is discussed.

NAIR, K. 2005. Brain Gain, the BPO Way. Business Standard, ICE World (April 6).

This brief article provides one of the few sources about foreigners going to India to work in offshore companies. The material is anecdotal, and the number of foreign workers in these Indian offshoring firms is small but growing. One main purpose of these workers is to give training in foreign languages. Others are often hired for management positions.

NANDA, M. 2005. Is India a Science Superpower? Frontline 22,19 (Sept.10-23).

Lead to the article. On the radical disconnect between the dreams of becoming a science superpower and the grim reality of mind-numbing superstitions and life-threatening pseudo-sciences that pervade all levels of society.

NATIONAL ASSOCIATION OF SOFTWARE AND SERVICE COMPANIES 2005. Indian IT-ITES - FY05 Results and FY06 Forecast (June 2).

NASSCOM's 2004-2005 research on the performance of the Indian IT-ITES sector showed 2005 to be a historic year in terms of growth, reaching its best level since 2001. The report gives data on revenues, exports, and employees.

NATIONAL ASSOCIATION OF SOFTWARE AND SERVICE COMPANIES AND KMPG HOUSE 2004. Choosing a Location for Offshore Operations in India. New Delhi, India (May).

The early part of the report discusses the reasons a company might wish to offshore work in the IT, IT enabled services, and business process outsourcing work areas. The main part of the study focuses on choosing a location, both choosing India over another country and choosing a particular location in India. It discusses advantages of locating offshore work in areas with strong business communities, strong educational facilities, tourist destinations, and places that have invested in infrastructure. The report assesses the ten major IT/ITES/BPO regional centers: Hyderabad, Ahmedabad, Bangalore, Kochi, Mumbai, Delhi, Chandigarh, Jaipur, Chennai, and Kolkata. The review of each regional center includes hard economic data and qualitative assessment of both strengths and weaknesses.

NATIONAL ASSOCIATION OF SOFTWARE AND SERVICE COMPANIES 2004. Strategic Review 2004: The IT Industry in India. New Delhi, India (Feb.).

This is NASSCOM's annual review of the IT industry in India. Topics include software and services exports, Indian domestic IT market, IT enabled services/business process outsourcing market, economics of global sourcing of services, software products, embedded software, and technology services, competitiveness of India with other outsourcing countries, emerging growth areas (product data management, content management, enterprise application integration, business intelligence, wireless applications, and applications in the healthcare, utilities, and retail industries), Internet and e-commerce penetration in India, e-governance, security practices, labor force, venture capital and private equity, telecom infrastructure, quality processes as a business strategy, and the policy environment.

NATIONAL ASSOCIATION OF SOFTWARE AND SERVICE COMPANIES 2002. Indian IT Industry: Learning From China. New Delhi, India (July).

This report is based on interviews with Chinese government officials, representatives of Chinese software and telecom companies, and Chinese software professionals as well as information from the consulting firms IDC and Gartner. It is a report by the leading trade association for the Indian IT industry sizing up the threat from the Chinese software industry. Topics include:

• assessment of China's potential in the software and services industry
• how Indian companies can engage with China
• learning from the Chinese PC industry
• learning from the Chinese semiconductor industry
• trends in China's packaged software market (as of 2001)
• trends it China's IT services market
• trends in China's IT spending by various industries
• profiles of software companies in China (including Legend Holdings, Yunnan Nantian Electronics Information Co., Neu-Alpine, Vanda Systems and Communications, NPU Co-Think Software Co., Icechina Tech, NETEC Co., Emerging IT Group, Keyou Software, and Neusoft)
• policies for encouraging development of software and integrated circuit industries (Chinese state policy document)
• human capital in China
• Golden Card Project (to issue more than 200 million cash cards, 1993-2003)
• demographic information

NATIONAL ASSOCIATION OF SOFTWARE AND SERVICE COMPANIES 2005. Strategic Review 2005. (Available at http://www.nasscom.org/).

This is NASSCOM's annual review. Topics include IT-ITES production, export figures, percentage of business attributable to the United States, size of IT workforce in India, structure of Indian offshore industry, workforce attrition, ICT penetration in Indian populace.

ORACLE, INC. 2005. Oracle India Factsheet. (Available at http://www.oracle.com/global/in/pressroom/factsheet.html Accessed June).

This Web page provides quick facts concerning Oracle's operations in India such as history of operations in India, size of Indian workforce, R&D activities, other Orcale divisions in India, Oracle products customized for the Indian market, Oracle's network of business partners in India, Oracle's customer base in India, and Oracle's online developer community.

O'RAIAN, S. 2004. The Politics of High Tech Growth. Cambridge University Press, Cambridge, UK.

From the Cambridge University Press Web site. This book argues that beneath the Irish trade and foreign investment boom lies a more interesting story of regional innovation promoted by an alliance between the state and local technical communities. This alliance was governed through a decentralized set of state institutions, drawing on global and local economic and political resources. This Developmental Network State has had a significant impact on the growth of Ireland's high tech cluster and is central to the emergence of an international network of global high tech regions from Silicon Valley to Ireland, Taiwan, and Israel. The book provides a detailed study of the rise of the software industry in Ireland and of the state institutions and political conditions which promoted it. It shows how new network state policies and institutions have been central to high tech regions elsewhere.

O'RIAIN, S. 2004. The Politics of Mobility in Technology-Driven Commodity Chains: Developmental Coalitions in the Irish Software Industry. International Journal of Urban and Regional Research 28, 3, 642-663.

From the article. This article uses ... contradictions with the Irish industrial structure to explore the dilemmas of development in a world of global and local networks. Through a case study of the Irish economy in the 1990s, the article explores how an industry and region that was 'locked in' to a dependent relationship of routine production within the global software production network managed to partially move up the production and technology chain to develop more sophisticated operations among foreign firms and an increasingly sophisticated Irish-owned sector.

PALVIA, S. 2003. Global Outsourcing of IT and IT Enabled Services. Journal of Information Technology Cases and Applications 5, 3, 1-11.

This article by a professor of management information systems at Long Island University is pulled mainly from many mass-market publications. However, it contains a great deal of detail that is not collected in such quantities elsewhere. The paper is particularly useful with examples of companies outsourcing work in India. There are also briefer portraits of outsourcing activities in China, Philippines, Russia, Mexico, South Africa, and Eastern Europe. There are examples from Boeing and IBM of employee backlash in the United States to offshoring. Also covered are discussions of the politics of H1-B and L-1 visas, educational implications for the United States of offshoring, ISO software certifications, and impacts on the US and global economies.

PEOPLE'S DAILY 2005. Survey on China's Software Employees. (May). (Available at http://www.china.org.cn/english/scitech/128010.htm. Accessed Sept.).

The article is based on a survey of 4400 people by the China Youth Software Promotion Project. "The survey answered why China lacks qualified software personnel. A backward education system produced students weak in programming capability, while enterprises employing them have been unwilling to provide relevant training. Meanwhile, China lacks special institutions to train managerial staff for software development. The result is software students can hardly find employers to accept them, while companies have difficulty in recruiting qualified programmers."

PEOPLE'S DAILY ONLINE 2004. SAP Vows To Enhance R&D Capacity In China. (Dec.). (Available at http://english.people.com.cn/200412/15/eng20041215_167405.html Accessed Aug. 2005).

From the article. German software giant SAP is to greatly boost its research and development team in China to serve local demands and also work as a global development base as the company's expansion in the world's most populous market enters a new stage. Shang-Ling Jui, managing director of SAP Labs China, said in an interview that his organization is building a new campus in Shanghai which will host all SAP research units in the city when it is completed. The new campus will have 1,500 engineers by 2009 compared to the current 200 researchers with SAP China.

From Amazon.com. In 1976, China's education revolution was being hailed by foreign observers as an inspiration for all low-income countries. By 1980, the Chinese themselves had disavowed the experience, declaring it devoid of even a single redeeming virtue. This is the first comprehensive book to cover the whole sweep of twentieth-century Chinese education, and in particular to provide a detailed study of what occurred in the countryside under the radical Maoist education experiments of the Cultural Revolution.

PINK, D. H. 2002. The New Face of the Silicon Age: How India Became the Capital of the Computing Revolution. Wired (Dec.).

The article gives a snapshot of what the daily lives of programmers and programming managers in India are like. It discusses the attitudes of Indian programmers towards the perceived job loss in America and what it means for individual programmers there. The article also discusses the anger of displaced workers in the United States and some of the organizations they have formed: Rescue American Jobs Foundation, Coalition for National Sovereignty and Economic Patriotism, Organization for the Rights of American Workers, Information Technology Professional Association of America. There is also a short profile of NJ State Senator Shirley Turner, who has introduced legislation to ban outsourcing of any state contracts to foreign countries and, in doing so, has become a hero of the protectionists. The article points the reader to Web sites such as yourjobisgoingtoindia.com and nojobsforindia.com

POLLICE, G. 2005. Software Engineering in China: The Next Big Thing. (May 15). (Available at http://www-128.ibm.com/developerworks/rational/library/may05/pollice/ Accessed Sept.).

Abstract from the paper. China is gearing up to become a serious contender for American and European software development outsourcing contracts. This column reports on what the Chinese government - and the country's universities and businesses - are doing to train professionals and upgrade domestic software development practices.

PREEG, E. H. 2005. The Emerging Chinese Advanced Technology Superstate. China's High-Technology Development. Statement Before the U.S.-China Economic and Security Review Commission. Palo Alto, CA (April 21).

The author is a Senior Fellow in Trade and Productivity at the Manufacturers Alliance/MAPI. This testimony was based on a forthcoming study entitled The Emerging Chinese Advanced Technology Superstate. The testimony begins with an analytic assessment of China's current technological state and its trajectory of technological development. The author claims that China is rapidly developing into an advanced technology super-state with economic, technological, financial, and political power and that this is occurring because China has all the essential ingredients to make this happen: a large domestic market; large public expenditures for research and development, education, and infrastructure; a competitive private sector; and open trade and investment policy. The second part of the paper recommends US policy responses, including issues concerning currency manipulation, bilateral trade and investment policy, and means to prevent China from forming a preferential East Asian trading bloc that locks out the United States. There are several brief discussions of information technology in the testimony, but the paper is more relevant in giving a larger assessment of China's technological opportunities and capabilities.

THE PRESS TRUST OF INDIA 2004. Outsourcing Extends to Many Professions, Not Only Call Centers. The Press Trust of India, Washington, DC (March 23).

The article offers a smattering of facts about offshoring in India. Offshoring to India includes not only call centers, but also medical sector processing such as insurance claims and hospital bills, medical transcription, medical billing, animation, insurance, digitization (converting engineering drawings, architectural designs, and maps from paper to digital format), desktop publishing, telemarketing, financial analysis for Wall Street banks and insurance companies, and accounting and bookkeeping. About 10% of US medical transcription has been outsourced to India, Pakistan, Canada, and other countries according to the American Association of Medical Transcription. Salaries for Indian workers in high-demand fields are increasing rapidly. Regulation tasks, such as reading X-rays and other images for US hospitals, is limited because they require training and licensing in the United States.

THE PRESS TRUST OF INDIA 2005. We are Ahead of India: China. The Press Trust of India (May 9).

A senior Chinese official from the ministry of information industry reported that in 2004 China's software industry reached 230 billion yuan ($27.8 billion), larger than India or Korea and 2.8 times the size of the industry in China five years earlier. Over the past five years, China has improved finance, taxation, industrial technology, export, income allocation, professional training, and purchase and protection of intellectual property rights in order to develop its software and integrated circuit activities. Software export is up six-fold in five years, to $2.8 billion in 2004. Problems for China include rigid education at universities and lack of on-the-job training.

RAI, S. 2004. India Sees Backlash Fading Over Boom in Outsourcing. The New York Times (July 14 ).

In recent months, Indian companies have been worried about the backlash to lost jobs in Europe and the United States, but there is now a sense in the Indian industry that this backlash has abated. A more pressing concern for some of the companies is finding enough qualified talent to fill their growing workforce. India's $15 billion software and back-office services industry has grown at about 30 percent in each of the past few years with an expectation of $50 billion in business by 2008. More than two-thirds of the business is with the United States. Infosys, India's second largest software and outsourcing firm, reported a 39 percent increase in its quarterly profit. Nearly two-thirds of its business comes from the United States. The company increased its employee count by 2300, to 28,000 in the quarter and gained 29 new clients, including Reebok, Amazon, Cisco, Apple, and Boeing.

RAJAN, S. 2004. Prosperity and its Perils. Time 163, 9 (March 1) 34.

The article gives an impressionistic picture of the perils of outsourcing work in Bangalore: working long hours, sleeping and showering at work, burnout, substance addiction, relationship breakdowns, sleep disorders, digestive problems and remedies such as dietitians, yoga teachers, and meditation teachers. No evidence is provided about how widespread these problems are.

RAMER, R. 2001. Moving Offshore: A Brief History of Global Software Outsourcing. Draft Essay.

The article tells the history of two early success stories in IT offshoring, India and Ireland. It explains some of the reasons that software globalization occurred (labor-intensive work driven by the dot-com boom, telecom boom, Y2K, and widening use of computers in the developed world) before turning to the two country's histories. The story of India includes the movement away from centralized planning with the election of Rajiv Gandhi and his plan to capture a significant share of the software export market through tax subsidies, reduced regulation, and infrastructure development, followed by more liberalization in the early 1990s that led to increased multinational investments in India. The importance of the higher educational system and English as the primary business language are discussed. The story of Ireland focuses on the role of the Irish government to slash taxes and bring in manufacturing jobs beginning in 1968. The software industry grew out of efforts to write software for the DEC VAX hardware built in Ireland. The importance of the Irish higher education system is emphasized, as are later efforts of the Irish government.

RAMSTED, E. 2004. The Technological Rise of China was Speedy - And Just the Beginning. The Wall Street Journal (Dec. 20), B1.

This brief article was stimulated by the purchase of IBM's PC division by a Chinese firm, Lenovo Group, and gives some markers of China's technological progress. China is now the second largest purchaser of PCs and has the second most Internet users (almost 100 million); in both cases, the United States remains the leader. The article also describes the concentration of specific technologies in specific regions of China such as television and computer assembly in Guangdong province, notebook production in Suzhou, and telecom equipment manufacturing in Hanghzou.

REDIFF 2005. Rediff interview with Naresh Gupta. (April 21). (Available at http://www.rediff.com/money/2005/apr/21inter.htm Accessed Aug.).

The article contains an interview with Naresh Gupta who has been promoted from Adobe's operations in India into the company's executive management group in the United States.

ROGERS, M. 2005. Can China Build its Own Silicon Valley? MSNBC.com (May 23).

This brief article describes the effort to build an advanced development community around Tsinghua University in the Zhongguancun neighborhood of Beijing. According to the author, there is an effort to build "an entrepreneurial infrastructure that can take a company from napkin doodle to business cards and a health plan in a week." Tsinghua is arguably the best university in China with strong programs in science and technology and a strong business school. The Tsinghua Science Park offers a full suite of services including venture capital, legal services, and property management. The article discusses the importance in this technological rise of "sea turtles," native Chinese who study overseas but return to China to work. Comparisons are made between China's run at America's technological superiority in the coming decades and the overblown Japanese challenge touted in the American press in the 1980s.

SAXENIAN, A. 2003. Government and Guanxi: The Chinese Software Industry in Transition. Global Software from Emerging Markets. London Business School (May).

Description from the paper. This paper begins with a brief history of the evolution of China's science and technology system, and its information technology sector in particular to highlight the widespread institutional changes underway in the transition from a planned to a more market-oriented economy. It then focuses on the development of the Chinese software industry--the market, labor force, sources of capital, ownership and management, and its regional distribution. The analysis highlights the persistent role of non-market factors, the government and guanxi, alongside the ongoing reforms oriented toward introducing market mechanisms into the economy. The conclusion focuses on the effects on the software industry of China's entry into the WTO and on the emerging trends in an economy where the pace of change is unparalleled.

SCHEIBER, N. 2004. As a Center for Outsourcing, India Could Be Losing its Edge. The New York Times (May 9).

The article discusses emerging labor shortages in the Indian IT workforce and the actions that companies are taking to reduce the effects. The strategies include parties for employees, large bonuses, salaries rising by 10% (15% for managers), an informal agreement among the top outsourcing firms not to poach employees from one another, and employment contracts that require no move within the first three months of employment. BPO companies are typically losing 15 to 20% of their workforce each year.

SHAH, R. 2005. Ketera India Case Study. Conference on the Globalization of Services, Asia-Pacific Area Research Center, Stanford University (June).

The paper, by the vice president of engineering at Ketera, is a case study of Ketera's experience in India. Ketera began to outsource work to India in 2002 and in 2004 formed a wholly-owned subsidiary there. Some of the topics include selection of a business model, functions to offshore, selection of a city, facilitators, hiring management, challenges in recruiting, and operations challenges such as communications, attrition, and different work style from the United States.

SHESHABALAYA, A. 2005. Rising Elephant: The Growing Clash With India Over White-Collar Jobs and Its Challenge to America and the World. Common Courage Press, Monroe, ME.

From a book review by Martin Kenney. The premise of this book is that the rise of the Indian economy, because it is based on software and white-collar work, is a unique challenge to the U.S. and the rest of the world economy. But the author goes much further intimating that the future is already a given, that India will soon displace the U.S. as the software capital of the world and will become the only major center of services offshoring. The remainder of the volume is a paean to all things Indian and the inexorable march of India to global leadership (dominance?).

SIGURDSON, J. 2004. The Emergence of the People's Republic of China: Challenges and Opportunities for Latin America and Asia. LAEBA Annual Conference, Beijing, China (Dec.). (Available at http://www.adbi.org/files/2004.12.3.cpp.prc.technological.capability.pdf Accessed March).

From the introduction to the paper. This paper will exemplify PRC's ambitions, strategies, and results in selected industrial sectors. Textiles is an example of a traditional industry where PRC has established a strong competitive advantage not only because of its low labor costs but also by significant technological upgrading. Technology plays an even more important role in sectors such as electronics. Here PRC started with an emphasis on consumer electronics at the lower end and is now following through with a strong entry into integrated circuits at the higher end. Aircraft and supercomputer industries are provided as illustrations of sectors where the future size of the domestic market - similar to electronics - could have a strong bearing on the outcome, and where PRC already has established a strong position as a component maker for Boeing and Airbus. Finally, biotechnology will be mentioned as an example where PRC, being less of a latecomer, has decided to join the world league nations in a research domain that has great future potential.

SINGH, J. 2003. Country Analysis: Mexico. (Available at http://www.american.edu/initeb/js5518a/Country-analysis-mexico.html Accessed June).

This brief article describes the Mexican Information Technology (IT) outsource software services sector, stating that although the industry is quite small compared to India, Mexico has unique advantages such as proximity to the United States. However, Mexico has some disadvantages such as language barriers, lack of experience, and media exposure. The human capital, telecommunications infrastructure, government support, industry association support, and regional IT clusters are also discussed.

SMITH, R. 2005. Partnerships Are Important. Rediff (Aug. 24). (Available at http://us.rediff.com/money/2005/aug/24inter.htm. Accessed Aug.).

The article contains an interview with Richard Smith, who is vice president for the Asia-Pacific region of IBM Software. He discusses issues of size and competition, among other topics.

SOFTTEK, S.A. 2005a. Corporate Home Page.(Available at http://www.softtek.com Accessed Aug.).

The page describes the Mexian software services company Softtek, a player in offshoring.

SOFTTEK S.A. 2005b. Our People..I n Their Own Words. (Available at http://www.softtek.com/nearshore/html/about_people.htm. Accessed Aug.).

The article provides autobiographies of five of the Mexican offshoring firm's employees.

SOLOMON, J. 2005. India Poaches U.S. Executives for Tech Jobs. The Wall Street Journal (Feb. 22) B1.

This news article describes the hiring of US high-tech executives at high salaries and bonuses to work for offshore companies in India. The recruiting is by both Indian companies and multinationals. These executive salaries pay a premium over US salaries for comparable jobs. Firms are taking advantage of the weak job market in Silicon Valley. Executives are sought both to penetrate overseas markets for Indian companies and to put into place management systems to oversee growth.

SRIVASTAVE, S. 2005. Could Rising Wages Diminish India's Outsourcing Edge? Siliconeer (Jan. 21).

This brief news article reports on a wage report of the Asia-Pacific Region by Hewitt Associates. The survey showed that salaries rose more in India in 2004 than in any of the other Asia-Pacific countries surveyed. Overall Indian salaries increased by 11.6%, but the IT sector had the highest growth at 14.5% (89% of the IT companies linked compensation to performance). There is concern that the rising wages, coupled with the appreciating rupee against the dollar, will undermine the low-wage advantage of doing business in India. The report also noted the high attrition rate or workers (15.4%) in India. In China, wages overall increased by 6.4 to 8.4%, and the worker attrition rate was 12.6%.

STAT-USA 2004. A Year-End 2003 Summary of China Electronics Information Industry Market. (March) (Available at http://strategis.ic.gc.ca/epic/internet/inimr-ri.nsf/en/gr123374e.html. Accessed March).

From the report. According to the Information Industry Statistics Report… by the Ministry of Information Industry, during 2003, the sales revenue of China's electronic information industry reached $235 billion, an increase of 34% compared with 2002. The information technology industry has become the number one industry in China and ranks third in the world … China Center of Information Industry Development predicts that in 2004 China's IT market will continue to grow by an average rate of about 20%. In accordance with the global IT industry's recovery, China will provide good market potential for foreign IT companies.

THAKKER, B. 2005. Globalization of Business Process Services - Analytical Study for India. The Globalization of Services Conference. Asia-Pacific Area Research Center, Stanford University (June).

This paper discusses the business process outsourcing industry in India. Focus is on Indian laws, policies, and regulation. Topics include the regulatory environment when the Indian software industry emerged, more recent regulation, growth of the outsourcing market, ownership structures and location selection, the role of Indian law firms in the offshore industry, comparison of regulation with China, and issues concerning future growth.

THATCHENKERY, T., BALATCHANDIRANE, G., STOUGH, R., AND RANGANATHAN, R..To appear. ICT and Economic Development: The Indian Context. In T. Thatchenkery and R. Stough Eds. ICT and Economic Development. Elgar, Northampton, MA.

The chapter explores the impact of information technology on economic development in India. It begins with a qualitative and quantitative description of the growth of the software industry in India, identifying the major regions of IT development. The Indian story is contrasted with the typical development pattern for a developing nation. The paper then turns to the impact that IT has had on economic and social development in India. Topics include regional growth and job creation in support industries such as catering, transportation, and consumer goods. The paper explores the impact information technology has had in India on education, health care, governance, and rural development. It concludes with an economic analysis of the prospects and challenges for India when considering information technology as a driver of economic and social reform for the country.

THIBIDEAU, P. 2004. BearingPoint Opens Second Development Facility in China. ComputerWorld 6 (July 6). (Available at http://www.computerworld.com/managementtopics/outsourcing/story/0,10801,94337,00.html)

BearingPoint Inc, a Virginia-based company, opened its second offshore facility in Dalian, China. The facility now has 60 employees but BearingPoint hopes to have 1,000 employees working there as soon as possible. "The company, which has 15,500 employees worldwide, also runs a development facility in Shanghai with 400 employees, as well as one in Chennai, India, with 100 people. It plans to expand the Chennai facility to 1,000 workers during the next year. BearingPoint also operates a development center in Spain…" According to Michael Ye, general manager of business operations at Dalian Software Park Co., other IT firms with offshore operations in Dalian include Accenture Ltd., SAP AG, Hewlett-Packard Co., IBM Global Services, and GE Capital. Although many multinational companies are starting to develop interest in China, the country remains far behind India in developing a significant export offshore operation.

THURM, S. 2004. Why Not Every Job Translates Overseas. CareerJournal 30 (March).

This article tells a cautionary tale about the efforts of ValiCert to offshore to India.

TIME NEWS NETWORK 2004. Another IT Firm Deserts US for India. (Dec. 8). (Available at http://economictimes.indiatimes.com/articleshow/950969.cms. Accessed Aug. 2005).

From the article: Ketera Technologies , the provider of on-demand eProcurement solutions, said its entire product development will happen out of its recently set up Bangalore development centre. The centre will function as Ketera's sole product engineering and development site for the company's entire suite of Spend Management solutions. Ketera India, which now has 25 employees, is capable of accommodating 125 employees.

THE TIMES OF INDIA 2004. Jobs that Won't Shift to India. The Times of India (May 11).

The article listed some jobs that are unlikely to get outsourced to India:

• business intelligence professionals,
• healthcare professionals (physicians, pharmacists, nurses, dental hygienists, home health aides,)
• jobs requiring physical contact (janitors, gardeners, dentists),
• high-end jobs (architecture, strategists, project management, business processes),
• service-oriented jobs (financial planners, IT consultants, pharmacists, accountants, teachers),
• sales jobs.

TSCHANG, T., AND XUE, L. 2005. The Chinese Software Industry. In A. Arora and A. Gambardella Eds. From Underdogs To Tigers: The Rise And Growth Of The Software Industry In Brazil, China, India, Ireland, and Israel.131-167.

From the chapter's introduction. The Chinese software industry, like the China of the past, is somewhat enigmatic. Its status is difficult to determine, in part because its strengths vary considerably, and because the industry is still in its infancy. In few other places in the world has a domestic economy provided such a powerful impetus and such ample opportunities for foreign and local software alike. Yet the leadership is strongly government influenced, and its development needs to be understood within the context of powerful government mechanisms.

UDANI, DHAVAL. 2005. The Quest for HTMLParser. (Available at http://htmlparser.sourceforge.net/articles/quest.html. Accessed Aug.).

From the article. In 1984, Citicorp Overseas Software Limited (COSL) was created by Citibank to produce low-cost software for its various banking operations. Citicorp Information Technologies India Ltd. (CITIL), now know as i-Flex, was formed out of this company about 10 years ago to service non-Citi clients. In 2001, COSL was merged with another arm of Citibank India known as Global Support Unit (GSU) to form OrbiTech Solutions Ltd. which, in turn, merged with Polaris Software Labs in 2002. With its expertise in the banking domain, OrbiTech undertook to develop a suite of banking products. However with several players in the market, it needed something innovative and fast. With an aim of increasing productivity, an initiative was started to develop tools, code generators, and reusable components to be used within the organization.

VAN BREEK, Y. 2005. Offshoring a Top Priority for European CEOs. (Online publicity for The Conference Board report, CEO Challenge 2004, Report 1353-04-RR). The Conference Board (July).

The articles summarizes a study conducted by The Conference Board called "CEO Challenge 2004", which states that "more European executives regard relocating operations abroad as a top priority than their counterparts in either the US or Asia…In a sign that European companies are beginning to recognize the inevitability of the outsourcing and offshoring trend and the consequences of an ageing workforce, 31% of chief executives of European companies see relocating to cross-border labor markets as one of their key business issues. This compares with 24% of CEOs in the US and 21% of Asian CEOs who share a similar priority."

VARMA, R. 2006. Harbingers of Global Change: India's Techno-Immigrants. Maryland: Lexington Books, Lanham, MD. (March).

From the publisher. Harbingers of Global Change: India's Techno-Immigrants enriches a revealing case study of a little-understood group of immigrants with the contemplation of broader social dynamics, including assimilation, acculturation, and the persistence of racial and ethnic prejudice. It reveals how familiar obstacles to social equity—such as the silicon ceiling—are complicated by the unique constellation of social pressures confronting a group of scientists and engineers whose talent is highly valued, and yet whose presence as culturally unfamiliar human beings is received with unease and ambivalence. The analysis combines United States political and social history as it bears on immigration policy with a sensitive and balanced treatment of how India's techno immigrants negotiate career, family, and loyalty to social-cultural traditions. Harbingers is not merely a badly needed contribution to the emergent literature on the plight of international immigrant-professionals; it is a visionary look at where global society is headed in the twenty-first century, an epoch in which all human beings may become foreigners in the virtual techno-marketplace.

VERMA, P. 2005. Adobe to Buy Macromedia's B'lore Development Centre. The Economic Times (May 16). (Available at http://economictimes.indiatimes.com/articleshow/1111152.cms. Accessed Aug.).

From the article. As global techies consolidate, they are leaving a trail of mergers in India, too. Close on the heels of Oracle buying Hexaware and Convansys development centers, $1.7 billion Adobe is now acquiring Macromedia's Bangalore-based development center. Macromedia's 8.1% stake in Mumbai-based mobile gaming company Indiagames is to move to Adobe India, too.

VERMA, S.P. Ed. 2004. Information Technology and Indian Administration. Indian Institute of Public Administration, New Delhi, India.

A special issue of the Indian Journal of Public Administration on IT and public administration was published as a separate article. Topics include improving quality of IT education, use of IT in public sector environments including e-governance, and IT and management issues.

WAGSTYL, S. 2004. Budapest, the Next Bangalore? New EU Members Join the Outsourcing Race. The Financial Times (Sept. 21) as reprinted in YaleGlobal Online 2004.

From the Web site. American companies have become the world's leaders in outsourcing services to regions with low labor costs. Western European firms, previously slow to follow this global trend, have now begun outsourcing labor to central and eastern European countries, whose advantages include geographical proximity and language proficiency. Despite early optimism, a few obstacles lie ahead. First, central Europe may lose its competitive advantage as wages increase to western levels. Second - and this concerns all outsourcing nations - technological advances may prove to be more effective than offshoring in cutting costs.

WALL STREET JOURNAL STAFF 2005. In India's Outsourcing Boom, GE Played a Starring Role. Wall Street Journal (March 23).

The article describes the critical role of General Electric in the rise of the Indian offshoring industry. The story began in 1989 with a successful pitch by the Indian government to GE CEO Jack Welch. At one point, one third to one half of the business of each of India's three largest offshore firms, Tata Consultancy, Infosys, and Wipro, was with GE. GE Medical Systems and Wipro agreed in 1989 to jointly market a low-cost ultrasound machine. GE moved business process tasks to India in the late 1990s and in 1998 began plans for a call center. GE taught its Indian contractors about effective business practices.

WECKLER, A. 2004. The India Jobs Timebomb. Sunday Business Post (Jan. 4). (Available at http://archives.tcm.ie/businesspost/2004/01/11/story728704866.asp Accessed June).

The article states that outsourcing middle class jobs to India has become a real threat to the Irish economy. David Begg, the general secretary of the Irish Congress Of Trade Unions, told the Tanaiste's Enterprise Strategy Group that outsourcing high-skilled jobs in financial services, IT and engineering to countries such as India was now ``a considerable worry''. Oracle recently cut its Irish workforce to 950 workers, citing difficult market conditions.

WU, G., YAN, L., AND WANG, Y. 2004. Beijing Regional Innovation System: History, Dilemma and Solution. 2^nd Annual Globelics Conference on Innovation Systems and Development: Emerging Opportunities and Challenges. Beijing, China (Oct.).

From the abstract. With the development of technological innovation and progress in the Beijing economy, building regional innovation system is paid more and more attention. This paper first describes the evolvement of the Beijing regional innovation system, and then discusses the limitations and shortages of the Beijing regional innovation system. Finally, this paper puts forward the strategic development pattern of the Beijing regional innovation system.

XIONG, S. 2004. Dalian to Build Software Industry Corridor. Xinhua Newsnet (July ). (Available at http://www.openoutsource.com/resource-dated7236-Dalian%20to%20build%20software%20industry%20corridor.phtml. Accessed June).

From the Website: Dalian, a port city in northeast China's Liaoning Province, has launched an ambitious plan to build a super software industry corridor along its southern coastline. The corridor is located in a 133 sq. km area along the city's South Lushun Road, a hilly seaside scenic spot. It has a land area of 8.6 sq. km and a construction area of 4 million square meters with a planned investment of over 15 billion Chinese yuan (1.81 billion US dollars). On this fantastic long and narrow area, a software export-oriented town will be built within four years, where 300,000 IT professionals can be employed.

YANG, D., GHAURI, P., AND SONMEZ, M. 2005, Competitive Analysis of the Software Industry in China. International Journal of Technology Management 29, 1-2.

Abstract. The software industry in the People's Republic of China has been growing rapidly over the last decades and has played a significant role in the economy. Alongside the industrial development, it appears that a comprehensive competitiveness assessment of this growing industry needs to be conducted. This paper draws on Porter's diamond theory of competitive advantage of nations and the suggested improvements of the framework from relevant scholars to assess the growing competitiveness of China's software industry. In particular, the focus is on the role of government policies and corporate strategies in shaping the competitiveness of the industry in China in comparison to the top players in the world. Specifically, the paper pays attention to the competitiveness of industry in China as to how and why it has developed the way it has in recent years and what have been the facilitating and impeding factors that has strengthened or weakened the industrial development. In the discussion and conclusions, the overall competitiveness status of China's software industry is evaluated and the diamond framework is reappraised in light of the industrial analysis and the previous research.

YIMIN, D. AND LEI, X. 2003. An End to Business as Usual? Science 302 (Oct.) 43.

From the AAAS Web site. Beijing University plans to implement dramatic changes aimed at breaking the insular nature of faculty hiring and promotions.

YUAN, L. 2005. Chinese Companies Vie for a Role in U.S. IT Outsourcing. The Wall Street Journal (April) B1.

The article describes the current offshoring situation in China. Topics include the cost of and need for English-language instruction for Chinese offshore workers, problems with intellectual property protection, a shortage of managerial talent, a fragmented industrial structure with too many small firms and too few large ones, lack of software engineering graduates (among the massive number of engineering graduates), personnel recruitment difficulties experienced by software offshoring companies in China, the limited support from the Chinese government for the offshoring industry, and the absence of a trade association or other advocacy group for the software offshoring industry in China.

ZDNET 2005. IBM Expands in China. ZDNet News (May 26). (Available at http://news.zdnet.com/2100-9589_22-5721779.html Accessed Aug.).

IBM has opened a new Global Services Delivery Center in Dalian, northeastern China, expanding its existing operations to meet what it says is a growing market demand for business process transformation and improved technology management services. The new center in Dalian will initially house 600 staff with capacity to grow in line with client demand. It is one of three IBM Global Services Delivery Centers in China, and is part of IBM's integrated services delivery network of more than two dozen centers around the world.