The new dot-bomb?

Frank Hayes makes a contrarian point about outsourcing:

With the dot-coms, we didn't know whether a Web-based business model would work at all -- or if it did, what kinds of businesses it would support. We didn't know how fast business could shift to the Web, or whether dot-coms really could transform retailing. All we knew was that bits cost less than bricks, so we figured everything else must cost less on the Internet, too.

A scrap of data, an untried business model and a lot of faith: That was the dot-com way, and we all chased it.

And offshoring? We know offshore programmers get paid less -- they're the bits-cheaper-than-bricks part of the scheme.

But we don't know what kinds of corporate IT projects can be effectively offshored. Or what happens to quality levels as offshoring volume ramps up. Or whether outsourcing will leave us with the flexibility and agility to adjust to rapidly changing business conditions, take advantage of new market opportunities and quickly respond to new user needs.

Great points, and it echos something I've said - the practice of tossing requirements over the wall to IT and getting a system back later never worked that well when the IT guys were local. What makes anyone think it will work well when they are 12 hours away (in timezone terms)? Something to consider...