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The World

Office of Tomorrow Has an Address in India

U.S. companies that discreetly embrace outsourcing find workers -- accountants typists, editors -- who are eager and talented.

August 29, 2004|David Streitfeld | Times Staff Writer

MADRAS, India — Task by task, function by function, the American office is being hollowed out and reconstituted in places like this, a makeshift facility on the sixth floor of a shopping arcade.

OfficeTiger Ltd., one of the most prominent and aggressive of a new breed of outsourcing companies, has hired 2,000 Indians, most of them young and all of them relentlessly gung-ho.

They work as typists, researchers, librarians, claims processors, proofreaders, accountants and graphic designers. Their clients are U.S. brokerage firms, investment banks, law firms and even copy shops.

The Indians take on jobs both big -- 100-page investment reports requiring weeks of work -- and small. Iayaraja Marimuthu, for instance, is designing a program for next month's wedding of Ann and John, a Texas couple proclaiming their joy in being "together for life." It will take him less than an hour.

Outsourcing, which started with U.S. firms laying off software programmers and call center workers and hiring cheaper employees overseas, is now stretching to encompass almost any kind of work that is done on a computer and is orderly and repetitive in structure. That's a vast category that stretches from copy editing to financial analysis to tax preparation.

Just as voice mail reduced the need for receptionists and word processors transformed the traditional role of secretaries, outsourcing is beginning to reshape the American office, eliminating some jobs and redefining others. Its proponents say it will lift the burden of tedious chores from millions of office workers, giving them more time to spend on challenging and creative enterprises.

"We're allowing employees to delve deeper, to learn more, to push the boundaries of what had been standard work," says OfficeTiger's American co-founder, Joe Sigelman.

That's one side of the argument.

But for other employees, outsourcing means the permanent threat of dismissal in favor of someone who can do the same job for one-tenth the salary.

It also means revamping the methods of entering certain professions, including law and finance. There's a time-honored tradition in those fields of making new associates do the drudgery. It teaches them the subject and winnows the number of aspirants to the truly dedicated. That won't happen if the drudgery is shipped elsewhere.

Some economists say outsourcing is so pervasive that it helps explain why the U.S. economy is doing a poor job of creating employment. Analysts expected a net increase of 200,000 positions in July, but payroll growth totaled 32,000. The August employment report will be released Friday.

Sigelman said he was doing his best to keep American corporate hiring down.

"We hope to be leading the move of white-collar jobs from the U.S.," he told the Economic Times, an Indian paper, in December.

Although many Indian firms, as well as American multinationals, are setting themselves up as outsourcers, OfficeTiger is particularly striking because it has come so far so quickly on so little.

Founded four years ago by two New Yorkers in their early 30s who had no expertise in the Internet, bureaucracy in India or even starting a business, the firm says it will have revenue of $40 million this year. Eight of the best-known financial firms in New York and London have signed on as clients.

Most started tentatively, with just a few employees doing data processing. But they rapidly scaled up, moving more jobs and more complex jobs. Stock market analysts are among the latest to see their work realigned.

Among other things, associate analysts prepare information on possible corporate acquisition targets. They go to databases, pull documents and put numbers into templates that can compare the company with its competitors.

"Once you've done it a couple of times, it's highly repetitive," says an OfficeTiger client, an executive with a New York investment bank. "You can't be an idiot, but you don't have to be Albert Einstein."

As this work, too, gets shifted to India, the executive predicts that there will be "fewer but happier analysts. They'll be doing more brainpower work."

The process is already moving beyond the associates.

Vinitha Venkat is an OfficeTiger manager whose team assembles data for a Wall Street brokerage firm that declined to be named. She and a colleague are going to New York, where they will enroll in the broker's analyst training program.

"I'm waiting for them to send everything to us," says Venkat, 27. "I don't think it will take that long."

During the flush times at the end of the 1990s, when it seemed the dot-com boom would go on forever, any young person with an ounce of ambition wanted to start his own company.

Sigelman and Randy Altschuler, best friends since their first day at Princeton University, had good jobs on Wall Street -- Sigelman with Goldman Sachs, Altschuler at Blackstone Group -- but dreamed of setting out on their own. The eureka moment came one evening when they were both waiting for documents to come back from the word-processing pool.

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