The Dao of Outsourcing

This article discusses how Chinese software developers rank major offshore outsourcing companies as employers by analyzing a popular Chinese website for high tech employees in China.

Of the hundreds of thousands of software developers in China’s high technology parks, a small percentage speak English or have more than five years experience.  As a result, software outsourcing companies compete for experienced English speaking developers as an increasing number of Western companies move software development to China.  For companies planning to offshore software development to China, it is difficult to assess a software outsourcing companies HR capabilities.  Average turnover rates are lower in China than India, but some offshore outsourcing vendors still experience 30%+ annual turnover.  How does a Western company evaluate the employee satisfaction of a potential offshore outsourcing partner in China?

It would be great if vendors accurately shared turnover figures, even better if they shared employee satisfaction surveys, then buyers could compare the HR capabilities of a software outsourcing company.  However, this does not happen and will not anytime soon.  Some buyers ask employees during site visits how they feel about employers, but a disgruntled employees is never going to be introduced to a potential customer.  Luckily, in the Web 2.0 world, employee satisfaction surveys of sorts are available online.

China’s most popular website where Chinese technology professionals discuss their employers anonymously without fear of reprisal is www.seecoco.com.  Software developers and engineers discuss their experiences with employers, answer questions from job seekers, and rate tech companies with a score from -10 to +10 with each post.  The website is anonymous and open so anything goes, and everyone gets a say.  Technology companies in China have found a direct correlation between how many resumes received in recruiting and their Seecoco ranking, so top outsourcing companies HR departments keep a close eye on their ranking.  So, how do software outsourcing companies match up against each other, as of today, here are the rankings for some major software outsourcing companies in China (scores can range from 100 to -100).

Interesting that the top two spots are not occupied by global or Indian providers but by local Chinese companies.  However, IBM and Infosys come in a respectable 3rd and 4th respectively.  Another interesting note is that the only Chinese outsourcing company to go public thus far came in dead last (of the companies I searched for).

Isoftstone came in 7th in the overall China top 10, while Google holds a strong #1 position for the top tech employer in China.  Here are the top ten technology employers in China from Seecoco as ranked by the websites users.

Of course these stats need to be taken with a grain of salt but they can be used as a metric for evaluating a potential offshore outsourcing vendors HR capability.  Also, for those who can read Chinese, the comments make for interesting reading and a lot can be learned about how well offshore outsourcing companies are fairing and approaching the war for tech talent in China.

Related posts:

1. Has the economic crisis helped outsourcing companies in China?
2. Is the global economic downturn affecting Chinese outsourcing companies?