Monday, May 21, 2007

Productivity of US and Indian IT professionals?

US IT Professionals More Productive than Indian IT professionals?

That is what a report says based on revenues per employee.
I won't go into explaining how the profitability of many Indian IT companies are better than US IT companies lest I should digress.

But that US IT Professionals are More Productive than Indian IT professionals is grossly mis-stated/analysed.

Revenue Per Employee of an US IT company can not be compared to an Indian It company. The day the two becomes comparable, US Lobbyist and IT professionals will stop crying about being bangalored.

A thousand dollars is still a lot of money, the appreciating Rupee not withstanding, and so, Indian IT companies are OK when they bill an US client 2 thousand dollars for an Indian programmer, because we are going to pay the prgrammer 1000 dollars for the same kind of work that his US counterpart who leaves office at 4 PM on a friday, does, and yet gets paid 5000 dollars . To pay 5000 dollars, taking the same logic(The figures are just hypothetical, I can give exact number if you want), the US IT company needs to bill the client 10000 dollars... That is 5 times.. :)

That is why INDIA is such a hot destination. If Indian Companies start billing the client as much as the US counterpart, the Industry will be dead before the Estimate hits the inbox of the client.

The report was fine, and going by the definition of productivity defined in terms of revenue per employee it is fine, but the report needs to be interpreted in a more logical way, no?

Disclaimer: I work for an US IT company, and have wokred for Indian IT companies as well, and have been actively involed in Estimatation process. The numbers I quote are just figurative to drive home the argument.

And yes, on output terms, and delivery, Indian IT pros are very good.


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