Software & Services Safari

July 2nd, 2009

Satyam: PWC's version of the 'Who's On First?' comedy routine

Posted by Brian Sommer @ 8:41 am

Categories: Auditing - Tax - Accounting, Contracting, Current Affairs, GRC - Governance Risk Compliance, India & Services, Professional Services, Selling Professional Services, Service Providers, Stories That Should Upset You, Timber - The Mighty Fall

Tags: Audit, PricewaterhouseCoopers Consulting, Satyam, Indian, Financial Accounting, Financial Statements, Outsourcing, Finance, It Operations, Business Operations

Who’s on 1st?

Thank you, thank you, thank you to the folks at TechMarketView for finding the most inane testimony yet in the still amusing Satyam fraud saga.

The story, and you’ve got to read the source document in The Times of India, is a hoot. If I got this right, the Chairman & CEO of PWC India is maintaining that:

- they didn’t have any staff in their PW office in Bangalore so they outsourced the auditing of the Satyam balance sheets to another auditing firm in the same building as theirs in Bangalore
- the outsourced auditors, Lovelock and Lewes, apparently signed the PW name on the financial statements of Satyam
- the audit fees for Satyam were paid to PW Bangalore and then passed onto Lovelock and Lewes
- other PW partners (from Delhi and Kolkata) have testified that they don’t have anything to do with the PW Bangalore operation

Now, if you go to PWC’s global website for Indian offices, look at these two sequential listings:

The PWC offices in Bangalore

So who did Satyam contract their audit work to anyway? Did PW Bangalore have a duty to Satyam shareholders, investors and the business community to report that another did their work for them? How would anyone have known that this occurred? How common is this outsourcing practice?

Are these two firms really separate? How would anyone know differently? And, who hires an audit firm that has no staff? Now, that one item (i.e., hiring an auditor bereft of staff) should get any CFO fired and jailed. Honestly, didn’t anyone do any due diligence on these people? Didn’t someone notice something different about the ‘auditors’ business cards? But, even more amazing is that any audit firm would let another firm do its work and sign its reports. Are we really supposed to believe this story?

Seriously, last week while I was teaching Point of View Selling to a class of software executives, I used a humorous case study involving the mythical accounting firm: PATSY (Price Arthur Touche Sells and Young). Looks like my material wasn’t as creative as what some auditors are trying to sell to Indian investigators and clients.

This sort of fantastic tale that was woven before Indian investigators tells me that the audited financial statements of an Indian firm, even a supposedly reputable one, may not represent the work of the auditor or the true position of the firm audited. Talk about a no-confidence signal.

It’s high-time PWC crack the whip on those in its Indian operation. Stunts like this make the profession and Indian business in general look like a joke (and no one’s laughing).

July 1st, 2009

NetSuite vs. SAP – How Newton would see this contest

Posted by Brian Sommer @ 8:10 pm

Categories: Current Affairs, ERP, Financial Software, SAP, SaaS and Beyond, Software Vendors, The Applications Market, Timber - The Mighty Fall, software, vendors

Tags: Software-as-a-service, NetSuite Inc., SAP AG, Barron, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Enterprise Resource Planning (ERP), Emerging Technologies, Enterprise Software

Competition is a great thing. It forces even the biggest firms to become humbled. It makes innovation a necessity. It can lower pricing and expand markets to everyone’s benefit.

Competition in the SaaS (software as a service) world of ERP got a little hotter this week when NetSuite trotted out its blessed German version of its ERP solutions. Their software has now been certified by German regulatory/auditing professionals and that means that NetSuite is open for business in a big way in SAP’s backyard.

Barron’s did a nice write-up on this and I’d encourage you to view that linked article. Others have covered this, too, including several of the Enterprise Irregulars.

Let me add the following thoughts regarding this announcement. First, let’s discuss SAP and SaaS. Dennis Howlett () and I wrote a smashingly detailed review of SAP’s Business ByDesign product over a year ago. It’s a 27-page masterpiece of insight that we can’t give away as that product is still moving in a really controlled rollout. I recently wrote about this mid-June and would really like to see some real market interest in that product. But, until the multi-tenancy and channel issues are sorted out, Business ByDesign is stuck in a real slow-mo existence.

NetSuite, though, can’t seem to quit moving. I get at least three press releases a week from them. Some of them aren’t really that earth-shattering but, overall, they point to a firm in motion. So, today we have a great example of Newton’s Laws of Motion (e.g., A body at rest stays at rest, and a body in motion stays in motion, unless it is acted on by an external force.)

NetSuite is the body in motion that’s staying in motion while SAP is the ERP vendor sort of stuck in idle – particularly where SaaS (software as a service) is concerned. Your move SAP.

June 25th, 2009

Prior Art for the iPhone?

Posted by Brian Sommer @ 12:05 pm

Categories: Humor

Tags: Apple iPhone, Prior Art, Brian Sommer

Did the iPhone infringe on a 400+ year-old design?

I was in the Amsterdam Historical Museum the other day in Amsterdam. In one tall, remote room, I looked up and spied this painting (see attached photo - courtesy of TechVentive, Inc.). It looked remarkably like that of an iPhone display. What do you think?

Look Familiar?

Seriously, I couldn’t help but remember that old patent maxim that there are no new ideas. Everything we create today is ‘built on the shoulders of giants’. Maybe the iPhone UI owes something to the Great Dutch Masters….

June 24th, 2009

Categorizing the SaaS Vendors

Posted by Brian Sommer @ 8:05 pm

Categories: Current Affairs, ERP, Future of Application Software, Software Vendors, The Applications Market, software, software. applications

Tags: Software-as-a-service, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Brian Sommer

Can’t tell the players without a program!

I get a couple of vendor briefings a week from SaaS vendors or their wanna-be cousins. As I listen to the various spins and pitches, it occurs to me that we need a new lexicon for these firms. Here’s my initial terminology submitted for your approval:

Originals – These are true, pure-play SaaS vendors. Think Salesforce.com, NetSuite and many others. These firms ‘got it’ almost a decade ago. In fact, they’re so with it that they’ve advanced well beyond SaaS. They have platforms as a service (PaaS), sell-out marketing events, cloud capable product lines and more. If you want to know where the market is going, watch these firms.

The Converted – Think older but wiser firms like CODA – Coda is a great traditional financial accounting software vendor who got the SaaS religion a couple of years ago. They leapt into the Force.com platform and quickly created the Coda2Go products.

Sadly, the market possesses too few converts. Instead, we get lots of the following players.

Committed to Commitment – These are usually old-school ERP vendors who can’t move their sales force off those high commission, on-premise license deals. Even if they could, the company can’t/won’t convert their product line to SaaS. Why? Introducing capabilities like multi-tenancy are just too hard for them to accommodate. Additionally, they spent too much money on their SOA marketectures (i.e., those still unfinished development efforts) and SaaS might cause further delays in getting these platforms and products finished. Oh, and don’t forget that SaaS offerings might cannibalize too much of their on-premise business! That said, these vendors are ‘committed to the idea of SaaS commitment’. Like the characters in the Frasier television show that made ‘committed to commitment’ a catchphrase, saying a phrase is easy but true lasting change is really hard.

If you want to watch products stagnate, watch these vendors.

Posers – These are firms who dream and speak of SaaS but have no idea how to deliver these solutions or offer a timeline of when SaaS will ever be more than brochure-ware for their firm. These are the zero calorie snack foods of the software industry – sound great but not filling.

Disbelievers – Amazingly, there are still vendors out there trying to convince channel partners, customers, prospects and analysts that SaaS is still experimental and not a real market force just yet. If you want to experience an alternate reality in software, sit in on one of these webinars. It’s eerie.

Have I missed any?

June 19th, 2009

Equity in the cellular world

Posted by Brian Sommer @ 1:47 pm

Categories: Uncategorized

Tags: Phone, T-Mobile, Equity, Carrier, Feds, Telecom & Utilities, Brian Sommer

Don

Vinnie over at Deal Architect and others are venting at the cellular telcos. The issues du jour are:

- high cost of international roaming
- locked SIM cards
- the cost to upgrade
- inability to buy unlocked phones like the iPhone
- etc.

I’ve got three phones off contract with T-Mobile. One other phone has already been moved off its old carrier and T-Mobile might get the boot soon. My list of issues with T-Mobile includes:

- T-Mobile’s unwillingness to cut me a price break when they aren’t recovering the cost of a subsidized phones from my ancient devices. I actually purchased replacement phones for two of these old T-Mobile phones awhile ago.
- T-Mobile’s unwillingness to carry any of the mid-to-high end Nokia phones
- T-Mobile’s unwillingness to carry the iPhone (I know they do in Europe but not in the US due to the deal they cut with AT&T)

I stopped at the Nokia store on Michigan Avenue here in Chicago yesterday. They’ve got some great phones that will work on the T-Mobile network. What I have trouble with is that I will pay full retail for a phone and yet T-Mobile will give me no credit against my bill for bringing my own phone to the party. However, if I wanted some other phone that T-Mobile is subsidizing, then I can get it for free or a nominal fee with, again, no difference in rates. That’s just not equitable.

T-Mobile even hired a market research firm to survey me to find out why I’m likely to abandon them. I’ve told their CSRs and their ‘customer retention’ professionals why I’ll bolt but these folks can’t change policy. They can only tell me that their carrier doesn’t offer the phones I want (e.g., Nokia E90 or E71, or, Apple iPhone) and will not change their pricing to accommodate those of us who want to bring our phones to a carrier. Sure, we have phone number portability but not phone or carrier portability.

Apple is a mixed bag for me, too. I’m still unimpressed that they have an exclusive deal with Apple. That deal is an expensive one for iPhone users and is the single biggest reason I won’t switch to AT&T. A more consumer friendly approach by Apple would have been to make the unit available at every carrier and let the competitive forces between carriers drive lower costs for all cell phone users. That didn’t happen and consumers are paying for it.

When Vinnie, et.al., complain about the cost of roaming, etc., the real issue is often much larger and distinct. The focus of our concerns should be directed at the overly cozy relationship between some of the carriers and some of the equipment providers. Another focus of concern should be the absent or silent action of regulators at the state and federal level to condone these business practices. The cellular market is not truly competitive and is not consumer-friendly. If you don’t believe me, go back and re-read your voluminous 2-year customer agreement with your carrier.

Until the market changes, get used to getting burned Vinnie. As for me, I’m bringing a big jar of Vaseline to the next cell store I enter.

*****
Talk about timing

As I am putting the last touches on this, what do I read? The Feds are getting interested in the exclusive deals being struck between carriers and cell phone manufacturers.

Let’s hope something comes of this.

June 16th, 2009

Adding agility to Compuware's Changepoint

Posted by Brian Sommer @ 11:27 am

Categories: Current Affairs, Implementing Technology, PPM - Project Portfolio Management, PSA - Professional Services Automation, Software Development, Software Vendors

Tags: Changepoint Corp., Compuware Corp., Project Management, Tools & Techniques, Strategy, It Operations, It service Management, Management, Brian Sommer

Compuware made a number of announcements re: Changepoint yesterday. Changepoint is the company’s project portfolio management solution. Changepoint is primarily targeted to mid-to-large IT organizations. Briefly, the company outlined a number of product directions for the near-term as well as showcased its Accelerator for agile development projects.

The agile development announcement was interesting as the company now has new functionality to support IT projects that are using the fast, repetitive agile development methodology. The software includes needed templates, best practices, reports, etc. to support agile development efforts.

This accelerator is also interesting because it works in concert (not standalone) with the core Changepoint product. In this manner, top IT and business executives can evaluate all projects regardless of the development approach used (i.e., agile or conventional).

Compuware also outlined a product roadmap that is focused on newer technologies and the effect these could have on project/IT management. The new solutions will support technologies such as Silverlight 2.0, W3C (non-IE) browsers and more. The company is

I was pleased to see these announcements as much of the focus from PPM/PSA (project portfolio management/professional services automation) vendors have been on delivery model (e.g., SaaS) or down-market versions of existing products.

June 15th, 2009

Open letter to all HR software vendors

Posted by Brian Sommer @ 6:30 pm

Categories: Analytics - Performance Management, Current Affairs, ERP, Future of Application Software, GRC - Governance Risk Compliance, HR, The Application Software Buyer, Web/Tech, software. applications, vendors

Tags: Human Resources, Boss, Brian Sommer

HR products haven’t really evolved much the last decade. Sure, many have changed their business and delivery models to become SaaS (software as a service) vendors but the functionality is still little changed from the 1990s. Yes, I know that talent management has seen some changes over the last few years but, honestly, are concepts like 360-degree evaluations and tying compensation to performance all that new? No.

Today, I will get a call from a dear friend who I’ve had the pleasure of working with for approximately 10 years in two different firms. About 10 years ago, she went to work with a firm closer to where she lives. The commute was great but the workforce, pay and management weren’t. She then left to join another firm but will likely tell me today that she is leaving them. Why? Gross mismanagement from the top.

I know from whence she speaks as I have toiled under inept, corrupt, morally bankrupt and vile bosses. I have seen what bad bosses do to organizations and the people who work (or worked) for them. I’ve seen them fire great people to make room for their toadies or people who won’t become a threat to their position. I’ve seen bosses with an air of superiority so bad that they wouldn’t dare think of listening to a mere commoner like me or others.

Did you know that close to 85% of the time that people leave one employer for another is because of their boss? I can believe it. And yet, amazingly, human resources (HR) software vendors don’t do anything to detect bad bosses. Seriously, how can you have a talent management product if you can’t even detect which of the managers or executives are causing large numbers of people to leave?

Now before every HR vendor out there flames me, let’s establish some basic tenets. Yes, many HR systems and firms support exit interviews. It is in these interviews that employees are supposed to tell an HR person why they are leaving. Do you really think they’ll cop to “My boss is a demeaning, narcissistic twit who verbally abuses everyone and makes our lives a living hell”. No – they’ll give some passable statement like needing to make a quality of life change. That way they’ll still have some chance of getting a neutral or positive reference from this soon to be former employer.

Many HR software products also support 360-degree feedback. This allows workers to provide upward feedback to their bosses. Well, this may be a shock to HR software developers but the average employee knows their responses to this evaluation will not be kept confidential and private. If these employees ever did spill the beans about a bad or dysfunctional boss, repercussions would likely follow but unfortunately they’d likely clobber the employee not the boss/manager. Even when bad bosses do get some tough feedback, research indicates that the narcissistic tendencies in these folks ensures that they will not change.

Third, HR products often possess analytic modules today. HR vendors will contend that these solutions can report which boss has higher than normal attrition. Well, isn’t that a great help! This tool causes firms to lose a lot of great talent until enough people (a statistically significant quantity) have left so that a monthly or quarterly report shows that there is a problem. This is such a waste of analytic (and executive) time as a great analytic tool should be predicting which managers may need an intervention before the attrition goes off the charts. Instead, the current analytic tools wait until the problem is really bad before the software reacts to the problem. Businesses need analytics with foresight not hindsight.

Here’s what an analytic application should do. First, HR vendors must learn to use something else besides just transaction data. They need to ask questions of executives to learn how they detect a bad management situation. They would learn about ‘proxies’ or ‘clues’ that something is amiss. They would then build an analytic application that scans all employees, all managers and all departments to see:

- which departments are experiencing higher than average transfer-out requests
- which departments are experiencing higher than average sick time
- which departments have personnel cashing in all of their stock options
- which departments are seeing their average personnel evaluation scores dropping
- which departments have a higher than average vacation time usage rate
- etc.

When a single department is leading many of these indicators, these are ‘early warning’ indicators that a bad, dysfunctional, ineffective, toxic or pathologically flawed manager is in charge.

Top executives want to know who is driving off their best talent. AND THEY WANT TO KNOW ASAP! But, do HR products do this? No way. Should they? You bet.

So will you, HR vendors, create these predictive (not historical), analytical tools? Will you help businesses identify and purge themselves of the narcissists, egomaniacs, paranoids, bullies and other managerial misfits that hurt your customer’s profitability, efficiencies and effectiveness?

The current crop of HR products was apparently designed to manage workers but not managers. These technologies are embarrassingly light when it comes to putting appropriate focus on middle and top management. It’s almost as if these vendors don’t want to upset those who might authorize the purchase of their products. In my conversations with HR executives, many of them are frightened to confront bad managers. Giving them the real insights into their business and its management might embolden HR professionals to rid their firms of bad managers/executives.

HR software vendors seem too content to stay in the HR transaction processing sandbox. Analytic thinking is not about presenting transactional data in new, pretty formats. Yes, it’s nice that a vendor can show a graphical correlation between performance reviews and compensation. But, that correlation isn’t exactly innovation. An innovative idea would be to look at non-transactional matters and create a new way to study, analyze and resolve those issues. So far, HR analytics have come up way short on the truly innovative scale.

I started this blog because of my frustration with HR vendors and their inability to spot bad bosses. My last word on that matter is that while you can’t legislate integrity, you can get rid of those who lack it. HR executives need better analytics and HR vendors should be creating the innovations in this area to enable them.

June 12th, 2009

SAP & SaaS - some clarifications

Posted by Brian Sommer @ 6:14 am

Categories: Current Affairs, ERP, Future of Application Software, HR, SAP, Software Vendors, The Applications Market, Web/Tech

Tags: Software-as-a-service, SAP AG, Software As A Service (SaaS), Managed Hosting, Cloud Computing, Emerging Technologies, Brian Sommer

TechMarketView ran a piece today about SAP and its SaaS (software as a service) products/initiatives. When I read the article, I thought this couldn’t be right. I was especially confused by this paragraph:

SAP’s flagship mid-market SaaS offering, Business ByDesign, announced in September ‘07, has been aimed at winning new customers. It has so far cost hundreds of millions of Euros to develop but is still very much in pilot phase. The new initiative is largely aimed at existing customers. There will be new functionality - strategic sourcing, expense management and CRM - compatible and interoperable with an in-house ERP system.

Business ByDesign was introduced a couple of years ago and it was a very expensive development effort for SAP. This product line is targeted for mid-sized firms, too. The product line though is still in a bit of controlled rollout though as SAP still has work to do in two areas: the multi-tenancy aspects of the product need some work as do the economics and composition of the channel ecosystem to implement these products.

When I read the quoted paragraph above, I thought I had missed some important dialogue re: Business ByDesign. So, I called Mike Prosceno at SAP to help me understand what had changed with this product line.

As it turns out, the initiative referred to at the end of the Business ByDesign comments is unrelated to Business ByDesign. It seems SAP is developing SaaS capabilities to supplement functionality in its Enterprise (think R/3) product line. SAP will move to the cloud certain functions/capabilities (e.g., employee self-service) that work well in a cloud environment.

Efforts to expedite the rollout of Business ByDesign are still underway but these are separate initiatives than those referenced in this report. As to the new initiatives, these may be a good thing for SAP. Cloud-based solutions are not only hot but may be needed if SAP is to continue to fend off newer competitors like Salesforce, NetSuite, Intacct, etc. Savvy readers will of course realize that some of these competitors aren’t new to SaaS. Some of these SaaS firms have been around for a decade now. That, of course, begs the question, “Are SAP’s SaaS initiatives timely?” That’s another blog post….

June 11th, 2009

No Surprise - Firms selling off Indian centers

Posted by Brian Sommer @ 1:14 pm

Categories: China, Current Affairs, India & Services, Mergers & Acquisitions, Outsourcing, Professional Services, Selling Professional Services, Service Providers

Tags: Firm, Center, Sales Strategy, Outsourcing, Asset Management, Financial Services, Sales, It Operations, Business Operations, Outsourcing & Subcontracting

The Wall Street Journal is reporting that major corporations are selling off their Indian IT and back office centers as part of belt-tightening moves. This really isn’t a big surprise. Why?

If well-designed and operated, these centers become assets of the firms they service. They would operate in a cost-effective and efficient fashion. They should perform at first or second quartile levels of performance. Great assets would be attractive to outsourcers, business process outsourcers and others. Should a third party make an attractive offer to the owner of these operations, many firms will accept these deals as they create a lot of scarce capital for the seller. This is capital that may be needed to help these firms get through tough economic times.

If these centers are not performing to the highest levels of performance, then these become luxuries that few companies can afford to keep in a tough economy. Selling these operations to others that can operate them better may be a good business decision for everyone involved.

If these centers are performing poorly, then they need to be sold asap as they represent a capital drain on earnings.

The fact that sales are up at this time represents two key factors:
- the economy is making firms re-assess their operations and their need for capital
- the cost and economics of running these operations may have changed. What looked like a good business decision years ago may no longer be so as the exchange rate and cost of labor in these centers are much changed.

It’s that latter item that should concern any firm/operation relying on low-cost labor arbitrage for its existence. Ireland used to be a big F&A BPO locale until Eastern Europe locations could deliver similar capabilities for less. India may become less attractive when compared to up-and-coming Chinese and other locations. As one market becomes popular, its economics often force businesses to look elsewhere in due time.

These sales of service centers may be just a data point in the evolution of labor arbitrage in India. They could also signal a change in the appetite of businesses to do business there versus an even lower cost locale.

June 5th, 2009

H-1B legislation to watch - What it's really about

Posted by Brian Sommer @ 7:46 pm

Categories: Current Affairs, India & Services, Professional Services, Selling Professional Services, Service Providers, Vendor Management, Web/Tech

Tags: Legislation, Worker, Dirk Durbin, DOL, Enforcement Issue, H-1B, Human Resources, Labor Relations, Brian Sommer

Both L-1 and H-1B visa law changes could impact SIs, outsourcers and more

Dick Durbin is one-half of the Durbin-Grassley senatorial duo that is proposing new legislation re: H-1B and L-1 visas. Lately, a number of publications have opined about the latest proposed legislation and its impact on outsourcers. Before I get to that, let’s look at what is on Durbin’s site concerning this legislation:

Some claim that the H-1B program helps to create American jobs, but it is currently being used by some companies to outsource American jobs to foreign countries. Under current law, an outsourcing company can use American workers to train H-1B guest-workers, fire the American workers and outsource the H-1B workers to a foreign country where they will do the same job for a much lower wage. In fact, Indian Commerce Minister Kamal Nath has referred to the H-1B as “the outsourcing visa.”

Employers can legally discriminate against qualified Americans by firing them without cause and recruiting only H-1B guest-workers to replace them. The U.S. Department of Labor (DOL) has said: “H-1B workers may be hired even when a qualified U.S. worker wants the job, and a U.S. worker can be displaced from the job in favor of a foreign worker.” Some companies that discriminate against American workers are so brazen that their job advertisements say “H-1B visa holders only.” And some companies in the United States have workforces that consist almost entirely of H-1B guest-workers.

To address these problems, the Durbin-Grassley bill would, among other things:

Require all employers who want to hire an H-1B guest-worker to first make a good-faith attempt to recruit a qualified American worker. Employers would be prohibited from using H-1B visa holders to displace qualified American workers.

Prohibit the blatantly discriminatory practice of “H-1B only” ads and prohibit employers from hiring additional H-1B and L-1 guest-workers if more than 50% of their employees are H-1B and L-1 visa holders.

Let’s look at these comments first. As to the points Durbin makes, there are a number of truths within them. Yes, there are companies that have advertised “H-1B only” positions. There have been firms who have sacked U.S. workers to make room for an H-1B worker. And, yes, there are no protections for U.S. workers who are fired to allow an H-1B worker to have the position. Finally, there can be no dispute that firms are moving jobs offshore.

So, what else will this legislation do?

According to Durbin’s web site, the legislation will address a number of enforcement issues:

To address potential fraud, the Durbin-Grassley bill would give the government more authority to conduct employer investigations and streamline the investigative process. For example, the bill would:

- Permit DOL to initiate investigations without a complaint and without the Labor Secretary’s personal authorization;
- Authorize DOL to review H-1B applications for fraud;
- Allow DOL to conduct random audits of any company that uses the H-1B program;
- Require DOL to conduct annual audits of companies who employ large numbers of H-1B workers.

The enforcement issues are certain a concern. Durbin’s site goes into more detail there on the shortcomings the Federal government has in this area. Fairness requires that law & regulations be uniformly enforced. Part of the dust-up today regarding H-1B visas is the public reaction to a few, well publicized instances of abuse. Those parties who pushed the extreme limits of the H-1B and L-1 visa programs have created PR, regulatory, legislative and other problems for systems integrators, software developers and outsourcers to name but a few.

As to the effect this proposed legislation could have on firms, Indian outsourcers are already preparing to lobby their cause before Washington D.C. legislators. Smart outsourcers are already contemplating the changes this legislation will have on their business model (for more on this, see this BusinessWeek piece). But note, the big rub seems to be around the ‘firms with more than 50 employees who have more than 50% of their workers on H-1B visas’. That part of the legislation is really attracting attention.

I would have thought the requirement to use a U.S. worker first and the prohibition of sacking a U.S. worker in lieu of an H-1B worker would have triggered the bigger response. I’m sure these provisions will sell well to U.S. workers/voters particularly in a down economy.

We all need to remember that this is ‘proposed’ not ‘actual’ legislation. Similar proposals by Durbin and Grassley last year did not pass. However, the difference now is that the Federal government has a high profile visa fraud case to prosecute. That case will keep this issue in the public eye and that’s something that will make the lobbyists of outsourcers work a lot harder.

We’ll need to watch this legislation. It could change the playing field for services both in the U.S. and abroad.