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Contract Employee's Newsletter
Helping Contract Professionals
Manage Their Careers
Vol. 4, No. 02
October 22, 2004
Edited by James R. Ziegler, Ph.D.
A Companion to:
The Contract
Employee's Handbook
www.cehandbook.com
Sponsored by:
P.A.C.E. - Professional
Association for Contract Employment
www.pacepros.com
About The Contract Employee's Newsletter
The Contract Employee's Newsletter is a free online publication
for technical and professional contractors containing news, commentary,
tips, links to useful resources, nuggets of wisdom submitted by
readers, and anything else that seems appropriate at the time. The
CENewsletter is published intermittently, whenever circumstances
warrant and time allows. Back issues are archived online, and content
is eventually rolled into the Contract Employee's Handbook. The
subscriber list is confidential and will not be disclosed outside
this organization.
In This Issue
Read recent
issues of The Contract Employee's Newsletter.
Featured Topic
Save U.S. Jobs
It is one thing to import cheap labor to work in the fields, or
to send menial jobs overseas to developing nations. After all, every
American has a social obligation (provided they have the ability)
to obtain the minimum education and training required to qualify
for better than menial work. Nowhere in the world is there greater
opportunity for anyone and everyone to improve and
apply their mind and skills than in the United States.
So, at least in theory, the importation of guest workers with minimal
skills, and the exportation of menial jobs to developing nations,
can be expected to have long-term economic benefits for American
industry and skilled American workers. And, at the very least, it
provides an incentive to American children and their families to
make sure that kids in this country get a decent education and commit
to lifelong learning.
However, I am very concerned about what is happening to skilled,
white-collar jobs in America. These jobs are also being sent overseas,
and cheap skilled labor is being imported for the express purpose
of displacing more expensive American skilled workers. The practice
of using foreign nationals to fill skilled white collar jobs provides
a very different incentive: an incentive to slack off, because what's
the value of an education if you can't compete in the open marketplace
for skilled jobs that are being sent overseas or handed out to low-cost
imported temporary workers on L-1 visas: to foreign workers with
no stake in the American economy; foreign workers who don't have
to buy a house in America, raise their children in America, pay
for American health care to keep themselves and their families healthy,
send their children to American colleges and universities, or ultimately
retire in America on a fixed income and what is left of Social Security.
The labor force can be sliced a number of ways:
- front-line workers vs. management and executive-level workers;
- unskilled workers vs. skilled workers;
- domestic workers vs. foreign workers;
- manufacturing sector workers vs. service sector workers.
The United States was a manufacturing powerhouse prior to the end
of the Second World War. The following half-century saw this country
evolve from a manufacturing sector economy to a service sector economy.
The steel industry is all but dead in America, and the domestic
auto industry and aircraft industries are in decline. Americans
invented the microwave oven, and now virtually all of the microwave
ovens in the world are manufactured in China. Ditto for televisions
and telephones.
Today, the United States economy is driven by service: Financial
Services, Insurance Services, Technical Services, Computer Services,
Educational Services, and Entertainment. Small businesses, consultants,
and entrepreneurs are the lifeblood of the American economy, annually
producing 80% of all new jobs. And many if not most of those jobs
are skilled, white-collar, service sector jobs. Anywhere from 30%
to 50% of the workers in many of the largest companies in the United
States are Contract Professionals and employees of small vendors
of specialized services.
The consumer confidence index drives the stock markets, and consumer
purchases account for 80% or so of the Gross National Product. Demoralized
consumers, underpaid consumers, unemployed consumers, and underutilized
consumers don't buy stocks, they don't contribute to retirement
plans, and they don't buy American goods and services.
And now American businesses are importing foreign, skilled "guest
workers" and outsourcing skilled service sector jobs to developing
nations, effectively doing to the American service sector economy
what the export of unskilled labor job did to the manufacturing
sector economy.
What is so insidious about all of this "cost cutting"
by American corporations is the destruction of the very foundation
of American democracy that has made this country great: the creation
of an informed (and highly educated) public. Where is the incentive
any more to excel in school and to learn marketable skills, when
the only jobs available to native born Americans are the few remaining,
low-skilled service jobs, or indeed any job that is not coveted
by an imported temporary worker on an L-1 visa?
If foreign countries are dumping their low-cost temporary labor
in the United States, how is that different from dumping low-cost
steel? After all, all that cheap steel should help the U.S. auto
industry make less expensive cars while increasing jobs and profits.
Yet, we place a tariff on imported steel because the loss of a domestic
steel industry would undermine U.S. self-sufficiency and national
security. Doesn't importing cheap, skilled labor also undermine
U.S. self-sufficiency and national security? Wouldn't it make sense
to place a tariff on imported labor as well?
Given the present situation with jobs, you have to ask yourself,
"What's left for the American white-collar worker? A career
in politics, sports, or the cinema? Or selling guns, drugs, and
..." Oh, I forgot, those are heavily outsourced jobs too.
Think about these issues when you vote for your local, state, and
national representatives this November 2nd. It may be about more
than jobs.
Return to Table of Contents.
Kudos and Testimonials
What People Are Saying About The Contract Employee's
Project
"... it is a real pleasure to work with a group of Professionals
that I have worked with so far at P.A.C.E. You really make me
feel like I am important. Please forward if you wish as I think
atta-boys have been earned." -- L.C.
Return to Table of Contents.
Business Basics
The Laws of Project Management
As a Contract Professional you will be working on projects. You
will be communicating with project managers and project team members,
and you'll be immersed in project jargon and project management
concepts.
There are no two ways about it. If you want to succeed as a Contract
Professional, you have to understand how project manager's think,
because it's project managers who will hire your consulting services,
and it's project managers who will evaluate your work, and write
(hopefully) glowing testimonials for your portfolio, and be outstanding
references for your next client, and refer you to their colleagues
at other companies, and ask you back again and again to work on
their projects.
Get the point? Even if you have absolutely no desire to manage
projects, you absolutely MUST understand as much as possible about
project management. It goes with the territory.
While researching project management terminology for the upcoming
revision of the Glossary of Terminology in the Contract Employee's
Handbook I came across the following words of wisdom that bear repeating.
They're from the Web site, www.projectauditors.com,
of a consulting company called Project Auditors, based in Rancho
Santa Margarita, CA. These 45 Laws of Project Management have been
learned, usually painfully, by many people over many years of managing
projects. Consider them carefully, ignore them at your peril.
Imagine how impressed your project manager will be when you scoff:
"Having a copy of Microsoft Project makes you a project
manager to the same extent that having a copy of Microsoft Word
makes you an author."
or when you proclaim:
"The first 90% of the tasks in a project will consume
90% of your resources. -- The remaining 10% of the tasks will
consume the other 90% of your resources."
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The Laws of Project Management
- Never slip a project a little bit. -- If you do, you will need
to slip it again... and again... and again...
- No major project is ever installed on time, within budget, with
the same staff that started it. -- Yours will not be the first.
- You are most ignorant about a project at the very beginning.
-- That's when you have to make the most critical decisions about
cost and schedule.
- You don't HAVE to plan. -- Success is not mandatory.
- There is a limit to how much you can accelerate the schedule.
-- There is no limit to how far it can fall apart when things
start going wrong.
- One advantage to fuzzy requirements is that they let you avoid
the embarrassment of estimating project costs.
- When things are going well, something will go wrong. -- When
things seem to be going better you have obviously overlooked something.
- The more ridiculous the deadline, the more it costs to try to
meet it.
- The first 90% of the tasks in a project will consume 90% of
your resources. -- The remaining 10% of the tasks will consume
the other 90% of your resources.
- The devil is in the details.
- The same work under the same conditions will be estimated differently
by ten different estimators. -- Or by one estimator at ten different
times.
- Chicken Little was an optimist.
- Projects are never late by intention.
- If you're not looking for it, you'll never see it. -- Even if
you're looking, you'll still miss a lot.
- Users will start to change the requirements as soon as they
understand what it is they originally asked for.
- Murphy's Law is alive and well. -- On your project.
- No system is ever completely debugged. -- Attempts to debug
a system inevitably introduce new bugs that are even harder to
find.
- A verbal agreement isn't worth the paper it's written on.
- A carelessly planned project will take three times longer to
complete than expected. -- A carefully planned project will take
only twice as long.
- A meeting is no substitute for progress.
- Frozen specs and Frosty the Snowman are alike. -- They are both
myths and they both melt when enough heat is applied.
- A real life project is not like a computer program. -- You can't
quit without saving.
- The closer the date, the higher the cost.
- A customer or user will tell you anything you ask about. --
nothing more.
- Things take longer than they do.
- Planning for failure is better than failing to plan.
- Denial is not a long term survival strategy.
- The first activity in any project is to identify your scapegoat.
- A computer program of 50,000 lines of code can fail in a single
line.
- There is a finite speed at which one can spend money effectively.
- If you don't know where you're going, any plan will take you
there.
- Fixing lines of code is simple. -- Fixing tested and integrated
systems is not.
- Fear of consequences is a great motivator.
- Encourage your project's participants to write change requests.
-- Yes, it's more paperwork, but it's the only real control you
have over the scope.
- Project scope and product scope are different. -- The customer
owns the product scope. You own the project scope.
- Success always occurs in private. -- And failure in full view.
- Any decision you make is going to have long-term consequences.
-- You can't predict all the consequences, but you have to live
with all of them.
- Bad employees drive out good employees.
- Having a copy of Microsoft Project makes you a project manager
to the same extent that having a copy of Microsoft Word makes
you an author.
- High levels of detail do not compensate for lack of clarity.
- The difference between a project manager and God, is that God
knows He's not a project manager.
- Everybody has expectations of you. -- If you don't set those
expectations on purpose, you'll set them by accident.
- Most projects that fail had failed before they started.
- Remember the 6 P's: Proper Planning Prevents Poor Performance.
[The Web site says 6 P's, but I only count 5. Hmmm...?]
- The project manager is not expected to be productive and profitable.
-- He [she] is only expected to do everything.
Return to Table of Contents.
Contract Employee's
Glossary
Terminology For Contract Professionals
More terms from Appendix
B: Glossary of Terms for Contract Professionals of The
Contract Employee's Handbook. These terms are from the greatly
expanded new glossary that is currently in development.
Work visa
A visa that allows a foreign citizen to work in
the United States. Work visas must be sponsored by the business
(petitioner) that seeks to employ the alien worker (beneficiary).
Examples of work visas are H-1B visa and L-1 visa.
H-1B visa
The H-1B visa is a temporary, non-immigrant, work
visa for qualified foreign professionals who are employed in the
United States in jobs that require a bachelors degree (or equivalent)
and specialized skills. An H-1B visa is approved by the U.S. Citizenship
and Immigration Services (USCIS) for an initial period of up to
three years, with a total of six years. Extensions in one-year increments
may be granted in rare circumstances.
Individuals who qualify for the H-1B visa are:
- Foreign professionals with specialized knowledge, such as scientists,
engineers, programmers, research analysts, management consultants,
journalists, accountants, and others with Bachelor's degree or
equivalent experience.
- Foreign nationals entering the U.S. to offer exceptional services
relating to cooperative research and development projects administered
by the U.S. department of defense.
- Professional nurses entering the U.S. to perform complex job
duties, or to supervise nursing operations.
- Distinguished fashion models
The H-1B visa must be sponsored by the American employer
(petitioner) on behalf of the visa holder (beneficiary). If the
H-1B visa holder changes employers, the new employer must file a
new H-1B visa petition with the USCIS. H-1B non-immigrants and employers
will not experience delays because legislation passed in 2000 allows
the beneficiary to change jobs immediately when the new employer
files a new petition. The overall six-year limit on an H-1B visa
is not affected when the beneficiary changes sponsors.
L-1 visa
The L-1 visa is a non-immigrant (i.e., not eligible
for permanent residence) work visa for intracompany transferees
who are foreign citizens. An intracompany transferee is an executive,
managerial, or specialized knowledge worker who is continuing employment
in the United States with an international firm or corporation.
The international corporation can be based in the United States
with at least one branch office the the foreign country, or it can
be based in a foreign country with at least one branch in the United
States.
Individuals who qualify for the L-1 visa are:
- Foreign national executives, who are transferred to the U.S.
to manage an organization, or a major function or division of
an organization.
- Foreign national managers, who are transferred to the U.S. to
supervise work of other supervisory, professional, or managerial
employees, or who manage an essential function, department, or
subdivision.
- Specialized knowledge employees of companies outside the U.S.
that have related U.S. branches, subsidiaries, affiliates, or
joint venture partners.
- Employees and partners of international accounting firms.
Typically, the U.S. Citizenship and Immigration Services
(USCIS) issues an L-1 visa for a period of three years. Thereafter,
extensions are usually given in two-year increments. The total permitted
period of stay is seven years for managers and executives, and five
years for specialized workers. Once the maximum duration has been
reached, the foreign worker must reside abroad for at least one
year, at which time he or she may reenter the U.S. in L-1 status.
Body shop
A derisive and often well-deserved term for a
recruiting firm that specializes in finding and placing foreign
(high tech) workers on temporary assignments at U.S. companies.
Body shops compete on price by billing significantly less than typical
recruiting firms. Then they pay their H-1B visa holders even lower
wages than typical recruiting firms pay American workers. Some body
shops are set up as American subsidiaries of foreign companies.
Body shops often abuse this relationship to bring in workers on
an L-1 visa as an internal personnel transfer, and then they lease
the worker out to a client organization.
Body shops have a reputation for taking advantage of foreign workers’
fears and ignorance to maintain their employees in a state of virtual
indentured servitude. Fortunately, the immigration law signed by
President Clinton in December 2000 has a portability provision that
makes it possible for H-1B visa holders to change employers with
relative ease. As a result, body shops have lost much of their hold
on H-1B visa holders.
The current push by body shops seems to be toward ever increasing
numbers of L-1 visas. L-1 visa holders are ineligible for a green
card (permanent residence), and therefore have no stake in America
other than drawing a meager paycheck. They are often housed in barracks-like
living quarters, or crammed into cheap apartments owned or rented
out by the body shop. The body shop may also hire a cook to provide
a wholesome and inexpensive diet of familiar food, and also provide
social and corporal entertainment.
Because they have no stake in America, L-1 visa holders have no
need to support a local domestic infrastructure such as ownership
and maintenance of a home, payments for an American college education
for their children, and the other relatively high costs associated
with life in America.
The practice of American companies importing cheap L-1 visa holders
to fill technical positions in American companies has displaced
hundreds of thousands of American technical workers, both employees
and contractors, and threatens to destroy the technical superiority
of the United States in the global marketplace.
Outsourcing
Outsourcing is a business arrangement by
which a vendor of specialized services, and its supervised personnel,
provides contracted services to a client organization, either on
the client’s premises (on-site) or on the vendor’s premises
(off-site), where those services could also be, or usually have
been, provided in-house by the client’s own employees.
Outsourcing can range in scope from a large contract in which a
consulting firm manages an entire business function, project, or
department to the practice of hiring individual Contract Professionals
and temporary office workers.
Sometimes the client legally transfers an entire infrastructure,
including its own employees, equipment, and possibly the entire
physical plant to the vendor of outsourced services. Transferred
employees are usually hired by the outsourcing vendor.
Increasingly, organizations are outsourcing business functions
to offshore vendors and subsidiaries, and, most insidiously, they
are contracting with so-called consulting firms who import low-cost,
foreign workers with H-1B and (mostly) L-1 visas. These foreign
workers are hired for the express purpose of displacing the existing,
higher-cost, American workforce, often requiring the American workers
to train their own replacements in order to qualify for severance
pay. This practice is not unlike requiring a doomed man to dig his
own grave.
Outsourcing comprises at least two types of services:
- IT Outsourcing (ITO): Engaging the services of a third party
information technology supplier to develop, debug, or manage a
particular software application or technology project. For example,
building a data warehouse, providing desktop support or network
integration.
- Business Process Outsourcing (BPO): In business process outsourcing
an organization engages the services of a third party to manage
an entire business process, such as accounts payable, accounting,
back-office human resources functions, outplacement, payroll processing,
procurement, recruiting, or management of staffing vendors according
to predetermined performance metrics.
Offshore outsourcing
Outsourcing is a business arrangement in which
one company provides services for another company where those services
could also be, or usually have been, provided in-house. Offshore
simply means “any country other than one’s own.”
The term offshore outsourcing usually refers to a type of business
process outsourcing (BPO) in which the United States and other developed
countries export IT-related work to politically stable, developing
nations in order to take advantage of lower labor costs and tax
savings.
Advancements in global telecommunications and the development of
high-speed Internet connections now allow companies to outsource
corporate IT functions to subsidiaries and vendors anywhere in the
world. Business trend economists call this process globalization.
Companies engage in offshore outsourcing because they are convinced
it is the best way to cut costs in order to be more competitive
in the domestic marketplace, and also to compete more effectively
on a global scale with businesses in other countries.
Critics of offshore outsourcing are concerned that the practice
discourages domestic workers from entering the IT job market, and
that homegrown IT talent will dry up. They point out that once the
United States loses its local technical expertise it will be difficult
to reverse the trend in the face of lost global IT superiority and
future global talent shortages. Also, critics fear that it will
be difficult for US companies to justify paying for higher salaries,
taxes and health benefits to a domestic workforce, thus leading
to lower wages and a lower standard of living across the board.
Proponents of offshore outsourcing argue that cost savings will
lead to greater productivity and competitiveness, which will contribute
to growth of the domestic IT industry plus more jobs and higher
wages for everyone.
In practice, the road to globalization through offshore outsourcing
has been a rocky one. There are many stories of impossibly poor
customer support from foreign call centers, and disastrous software
development projects, not to mention serious concerns about the
security of corporate intellectual property, identity theft, personal
privacy, and national security when sensitive data are sent to countries
that have little or no respect for such issues, and where laws protecting
abuses are either absent or unenforceable.
Return to Table of Contents.
The Contract Employee's
Project
The Contract Employee's Project is the larger context under which
the following interrelated vehicles operate to promote and defend
the interests of Contract Professionals:
- The Contract Employee's Handbook
- The Contract Employee's Newsletter
- The Contract Employee's Workshop
- Professional Association for Contract Employment (P.A.C.E.)
Return to Table of Contents.
Copyright and
Publication Info
Copyright (c) 2004, James R. Ziegler. All rights reserved.
You may copy or forward this free publication provided it is left
intact with all links and this notice unchanged. Any unauthorized
duplication, including republication in part or in full for commercial
use, is an infringement of copyright. We encourage you to freely
distribute hyperlinks to this issue of the Contract Employee's Newsletter.
Published by:
P.A.C.E. - Professional Association for Contract Employment
1355 Willow Way, Suite 244
Concord, CA 94520
USA
http://www.pacepros.com/
Editor:
James R. Ziegler, Ph.D.
Executive Director
P.A.C.E. -- Professional Association for Contract Employment
(925) 680-0200
CENewsletters@pacepros.com
Return to Table of Contents.
Disclaimer
The Contract Employee's Newsletter is designed to provide information
in regard to the subject matter covered. Use is granted with the
understanding that the publisher and authors are not engaged in
rendering legal or financial advice. If expert assistance is required
you should seek the services of a competent professional.
The purpose of this information is to educate and entertain. The
publisher and contributors shall have neither liability nor responsibility
to any person or entity with respect to any loss or damage caused,
or alleged to be caused, directly or indirectly, by the information
contained in this Newsletter or by information contained in any
web site or resource referenced by citation or hypertext link within
the pages of this Newsletter.
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Sign-off
I hope you have found the information in this newsletter to be
interesting, informative, and provocative. I encourage you to share
the CENewsletter with your friends, colleagues, coworkers, clients,
and agency recruiters.
Why clients? Because you need every ally you can get. Why agency
recruiters? Because they need to know the jig is up.
Wishing you success in your contracting career,
James R. Ziegler, Ph.D.
Executive Director
P.A.C.E. -- Professional Association for Contract Employment
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