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Former Oracle CIO promotes offshore outsourcing

Marc Hebert, executive vice president of Indian outsourcing firm Sierra Atlantic isn't afraid of controversy. In fact, Hebert said he craves it.

Hebert has been on national television pushing the benefits of offshore outsourcing. A former Oracle executive, Hebert left the software vendor in 1998 to become second in command at Sierra Atlantic because he said he saw that a constant drive for higher profits would eventually prompt a surge in offshore outsourcing.


While CIO of Oracle, he was one of the early adopters in outsourcing Oracle jobs to India-based companies. More recently, Hebert has been helping guide Sierra Atlantic, an offshore outsourcer of software development, maintenance and support, with clients ranging from Oracle to Hempel Coatings, an international marine paints company.

Although its U.S. offices are in Fremont, Calif., nearly all its 800 contractors are based in India, Hebert said. The company has a development center in Hyderabad, India, and other offices in Indonesia, Malaysia, Singapore and the U.K.

In an interview with, Hebert addresses concerns among U.S.-based DBAs, software developers and others who fear that unfair competition from overseas workers has lowered wages and, in some cases, contributed to the long lines at the unemployment office.

What is the history behind Sierra Atlantic? How did it turn into an offshore outsourcing vendor?
Sierra Atlantic started 11 years ago and Oracle was the first and largest customer for the company. When I joined the company in 1999, it was a $10 million company with a strong focus on the Oracle technology stack. When the downturn hit nearly all companies at the end of 2000 and 2001, we refocused the company toward an offshore enterprise applications services model. Today, we do a lot more focusing on Oracle applications and help companies figure out how to implement and support what they have. Why offshore the work to India? Why can't your firm use employees based in the United States?
The offshore model is a really compelling model, because there's a tremendous cost savings. It's used by Oracle applications customers to offload projects and functions that are generally routine and areas that give their employees time to do new projects rather then focusing on older technology. A lot of our work is conducted by employees we bring into the United States on a contractual basis. How can U.S.-based IT workers be more competitive in the workplace?
I think the clear trends these days are in Web services and service-oriented architecture projects. There is also a movement toward open source technology. Linux is moving on the operating system side and in other commodity technologies, and it's becoming compelling to companies. Oracle's grid computing initiative is also an area that I'd look at, as its reducing the cost of computing on the hardware and systems software side. In the applications sector, the on-demand computing model is really starting to mature well and we're seeing successes in smaller startups.

A lot of our work is conducted by employees we bring into the United States on a contractual basis.
Marc Hebert,
executive vice presidentSierra Atlantic
Isn't it true that companies are beginning to outsource some higher level skills?
We are taking on some higher skills. We've got a detailed knowledge of applications and advanced technology like 10g. What I'm trying to differentiate here is that we take over the skills that are done routinely and pretty quickly. We've also been doing new module implementations. What kind of work is Sierra Atlantic getting?
Oracle customers represent about three quarters of all our work. The sweet spot now is in implementing new modules of Oracle applications. Once the work is done on site, we also perform daily maintenance operations and support. We have both a technical and functional help desk located offshore, and we also help firms with enhancements and integration work, which is conducted onshore. Companies are trying to avoid the negative attention they get from offshore outsourcing. How do you convince them to sign on?

Oftentimes we have to educate them and take it one step at a time. We can show them that we see the offshore model effectively and profitably, and that it's a win-win situation for all involved. At first they are unaware and skeptical of what you can do offshore, but once we show them that we can effectively execute a project and get them comfortable with the model, they've been happy with the results. Sometimes companies think they'll be always working with people operating halfway around the world, but in reality it's the exact opposite on major projects.

A good example of a company that we've gone through a cycle with is the Clopay Corp., based in Cincinnati. We won an Oracle 11i upgrade project in a competitive bid; it was executed entirely on site. We brought people over to work on that project and during it we began to socialize the idea of how we can continue to support the project using our offshore model. We started with a three-person team and now we have a much more substantial relationship. So, it's easy to take baby steps.

As offshore outsourcing becomes more controversial, states have been working to develop legislation that halts the use of offshore workers. How is Sierra Atlantic responding?
For More Information:

DBAs defend against offshore outsourcing

Database automation boosts outsourcing

Some state legislation has been proposed, but not passed. Most of the legislation deals with state contracts and not with the private sector, nor do we expect any. We pay very close attention to all that. We welcome a healthy debate. We've found that the more controversy there is, the more interest there is in our services. There is an awful lot of literature and good economic analysis on the positive effects of the offshore movement. While it has been a common practice for a while now, the market has remained strong. What is driving the offshore outsourcing trend?
The trend in the use of offshore resources has to do with continual pressure on companies to operate more efficiently and cheaper then ever before and, if you don't meet those goals, your market share will decline. We've got a number of startups that must conduct product development offshore before they can raise money from the venture community and execute products in an efficient way. The offshore model is what enables these companies to get their funding and survive.

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