[Vanguard partners with Infosys for Defined Contribution recordkeeping]

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Helo80
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Helo80 »

Kenkat wrote: Tue Jul 14, 2020 7:27 pm Everybody wants everything cheaper as long as it doesn’t affect our own high paying jobs.

There’s a lot of nice people in India. And smart, willing to work hard for a better life.

I do feel bad for the people losing jobs. Pawns in a rich man’s chess game.


Fidelity seems to be making it work with lower fees.

Who cares if their AUM and management fees are higher? At least you're not calling people across the Pacific.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by nydoc »

.....
Last edited by nydoc on Tue Jul 14, 2020 7:59 pm, edited 1 time in total.
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Taylor Larimore
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"More than 425 funds"

Post by Taylor Larimore »

Bogleheads:

I assume Vanguard knows what it is doing -- certainly more than we know. Nevertheless, I wonder about this:
"The firm, headquartered in Valley Forge, Pennsylvania, offers more than 425 funds to its more than 30 million investors worldwide."
Best wishes
Taylor
Jack Bogle's Words of Wisdom (to his employees): "My firm-wide standard of conduct, applied universally to officers and crew alike: "Do what's right. If you're not sure, ask your boss.""
"Simplicity is the master key to financial success." -- Jack Bogle
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prad81
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by prad81 »

LazyNihilist wrote: Tue Jul 14, 2020 7:17 pm While the 1300 employees are not laid off, they are moved to Infosys.
This is very much a layoff from an employee's perspective. They have lost their Vanguard job, forced to work for an unknown company that they did not sign up for, and will possibly have to quit or settle for a much smaller pay that will require them to work nights and weekends co-coordinating with their new counterparts in a different country.
Last edited by prad81 on Tue Jul 14, 2020 8:03 pm, edited 1 time in total.
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Kenkat
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Kenkat »

Helo80 wrote: Tue Jul 14, 2020 7:50 pm
prad81 wrote: Tue Jul 14, 2020 6:41 pm
McGilicutty wrote: Tue Jul 14, 2020 6:34 pm Is this a case where Vanguard is bringing in a bunch of H-1Bs to replace American workers?
No, this is a case where well-paying American jobs are outsourced to foreign companies and sent to India. In a couple of years, Infosys will reduce the 1300 head-count to about 30 onsite coordinators in the US and the rest of the work will be performed in India. This is their tried-and-tested operating model.

100%. I'm curious if anybody on this forum can defend Vanguard's actions, as this is 100% taking I presume to be solid American jobs and sending them to India. Infosys is one of the dirtiest H1B abusers in this country.

(Angry Cuss word) Vanguard.

@LadyGeek and other mods/admin --- is there anything we can do? Invariably, this decision was not made in haste, and it's likely too late.
Look at the smartphone you likely have in your pocket. Or your big screen TV. They used to make electronics like that in the US.

Look at the shoes on your feet or the shirt on your back. They used to make those here in the US.

It’s a global economy. While I do understand the outrage at what seem a heartless decision (and it is), we’ve all got to eat our own cooking because we make decision every day as consumers that put people out of work.
Last edited by Kenkat on Tue Jul 14, 2020 8:04 pm, edited 1 time in total.
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ray.james
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by ray.james »

Helo80 wrote: Tue Jul 14, 2020 7:51 pm
brianH wrote: Tue Jul 14, 2020 6:58 pm I know people that work there, and I live near the Malvern office. This is a dirty move by them, and I will be moving as many assets as is practical to Fidelity -- there's no longer a moral argument to be made for Vanguard.


Yes, I will actively look into this as well.

I'd rather pay 8 or 10 bps for TSM Index funds to Fidelity and happily make Americans richer than pay 4 or fewer bps to Vanguard and let India get richer. I don't care if the Johnson family are a bunch of billionaires now and Jack Bogle (RIP) is small beans next to them. Jack is dead.

(Angry cuss word) Vanguard.
I think that is knee jerk. If you google fidelity outsouring projects there are a lot of hits. Besides Fidelity itself is one of the major employers in India through their own limited corp.
In 2004, Fidelity established its first presence in India by opening an office in Mumbai. However, their offices in India mostly serve back-office function and do not make any investments related decisions. The company has over 4,000 employees in India. Its second largest software development facility (after the United States) is in Bangalore and Chennai.
When in doubt, http://www.bogleheads.org/forum/viewtopic.php?f=1&t=79939
Helo80
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Helo80 »

prad81 wrote: Tue Jul 14, 2020 8:02 pm
LazyNihilist wrote: Tue Jul 14, 2020 7:17 pm While the 1300 employees are not laid off, they are moved to Infosys.
This is very much a layoff from an employee's perspective. They have lost their Vanguard job, forced to work for an unknown company that they did not sign up for, and will possibly have to quit or settle for a much smaller pay that will require them to work nights and weekends and co-ordinate with their new counterparts in a different country.
And probably crosstrain.... e.g. teach a H1B Visa holder from india how to do your job.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by drk »

ensign_lee wrote: Tue Jul 14, 2020 7:23 pm Moving to Fidelity then. Their interface is better, and their service is about to be better too.
Fidelity's service has long been better than Vanguard's. Vanguard shines as a fund manager, not as a brokerage.
RocketShipTech
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by RocketShipTech »

prad81 wrote: Tue Jul 14, 2020 8:02 pm
LazyNihilist wrote: Tue Jul 14, 2020 7:17 pm While the 1300 employees are not laid off, they are moved to Infosys.
This is very much a layoff from an employee's perspective. They have lost their Vanguard job, forced to work for an unknown company that they did not sign up for, and will possibly have to quit or settle for a much smaller pay that will require them to work nights and weekends and co-ordinate with their new counterparts in a different country.
+1. Anyone who thinks this is business as usual for these 1300 employees is as naive as someone who thinks Vanguard fundholders actually “own” the place.

If there were no cost savings from this move why would Vanguard do it?
Helo80
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Helo80 »

ray.james wrote: Tue Jul 14, 2020 8:03 pm I think that is knee jerk. If you google fidelity outsouring projects there are a lot of hits. Besides Fidelity itself is one of the major employers in India through their own limited corp.
In 2004, Fidelity established its first presence in India by opening an office in Mumbai. However, their offices in India mostly serve back-office function and do not make any investments related decisions. The company has over 4,000 employees in India. Its second largest software development facility (after the United States) is in Bangalore and Chennai.


Early 2000s were ripe for this though.... And I do get it, but I assume people laid off in 2004 have found work by now. Right now, 1300 people are being dumped into a crazy, COVID economy. We'll see how long Infosys keeps it agreement with said former Vanguard employees before they unilaterally try to change the terms.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Priam »

The company I work for did something similar. Customer service and IT went to a contractor who at first hired all the U.S employees from our company but within two years had fired the majority of the U.S workers and replaced them with people from Pakistan and India. These workers do everything remotely so there was no need for visas to become obtained.

In my company’s case though this ended up being a disaster as we deal with real estate and it was really hard to get the overseas workers to understand the day to day business practices of various cities, counties and states. So about 5 years after this transition and millions lost from people taking their business elsewhere, the company started to undo the outsourcing and brought back U.S customer service and IT. We still have outsourcing but not to the extreme like it was before.
nydoc
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by nydoc »

How did Vanguard Workers Union agree for this? Oh wait- union is the bad word.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by bottlecap »

The only thing I know for sure is that every consumer knows how to run a business and everyone with an opinion Is an economist.

Neither is really true but everyone can vote with their feet. Few do, which is suggestive.

I’ll wait to see how this plays out.

JT
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whodidntante
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by whodidntante »

Helo80 wrote: Tue Jul 14, 2020 8:05 pm Early 2000s were ripe for this though.... And I do get it, but I assume people laid off in 2004 have found work by now. Right now, 1300 people are being dumped into a crazy, COVID economy. We'll see how long Infosys keeps it agreement with said former Vanguard employees before they unilaterally try to change the terms.
Article says 12 months. If they've got it in writing as a statement from Infosys, it's a contract. The employee may also have certain obligations on their end, like a financial penalty if they don't stay for 12 months.
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SB1234
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by SB1234 »

Really surprised at all the teeth-gnashing about this news. This is exactly what happens in capitalism. Especially here.
The idea is that money saved can be used in better ways.
Lesson for everyone still working to be always prepared for something like this happening to you.
Don't be surprised when someone moved your cheese.
Last edited by SB1234 on Tue Jul 14, 2020 8:19 pm, edited 1 time in total.
anecdotes are not data
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by srt7 »

Normchad wrote: Tue Jul 14, 2020 7:12 pm
TheTimeLord wrote: Tue Jul 14, 2020 7:06 pm Sounds like a good reason to communicate with Vanguard.

Just remember, this isn't India stealing America jobs. These are Americans doing this.....

....
This. Very VERY much. Infosys might be a third world country company, you might be transferred to India for customer service etc. etc. but don't forget it was Vanguard that sold out. So IF you feel like blaming someone then blame Vanguard.
I can't think of anything more luxurious than owning my time. - remomnyc
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LazyNihilist
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Re: "More than 425 funds"

Post by LazyNihilist »

Taylor Larimore wrote: Tue Jul 14, 2020 7:58 pm Bogleheads:

I assume Vanguard knows what it is doing -- certainly more than we know. Nevertheless, I wonder about this:
"The firm, headquartered in Valley Forge, Pennsylvania, offers more than 425 funds to its more than 30 million investors worldwide."
Best wishes
Taylor
Is that 422 too many funds Taylor? :happy
The strong do what they can and the weak suffer what they must -Thucydides
srt7
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by srt7 »

Bama12 wrote: Tue Jul 14, 2020 7:33 pm I thought we owned the place. :)
Me too! Apparently not because I wasn't even given a chance to vote on it :D
I can't think of anything more luxurious than owning my time. - remomnyc
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unclescrooge
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by unclescrooge »

TheTimeLord wrote: Tue Jul 14, 2020 7:12 pm
lostdog wrote: Tue Jul 14, 2020 7:11 pm
Nummerkins wrote: Tue Jul 14, 2020 7:10 pm
lostdog wrote: Tue Jul 14, 2020 7:02 pm So if I ever need to call in for help, it could be going to India?
The article states this is only for DC plans -- so things like 401ks and profit sharing plans. Doesn't sound like it will impact the retail investor.
Yep, just read it. Thank goodness.
Doesn't mean retail investors should support or condone it. Besides if the deal sticks it likely will expand.
It's only a matter of time before we all serve our robot overlords.
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whodidntante
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by whodidntante »

Priam wrote: Tue Jul 14, 2020 8:08 pm The company I work for did something similar. Customer service and IT went to a contractor who at first hired all the U.S employees from our company but within two years had fired the majority of the U.S workers and replaced them with people from Pakistan and India. These workers do everything remotely so there was no need for visas to become obtained.

In my company’s case though this ended up being a disaster as we deal with real estate and it was really hard to get the overseas workers to understand the day to day business practices of various cities, counties and states. So about 5 years after this transition and millions lost from people taking their business elsewhere, the company started to undo the outsourcing and brought back U.S customer service and IT. We still have outsourcing but not to the extreme like it was before.
I have seen a range of results. Texas Instruments was probably the first major American corporation to demonstrate success in India. American companies that run their own operations there or partner with small companies that need to keep you happy in order to meet payroll tend to have more success. Those that partner with companies that are much larger than they are, and frankly wouldn't even be mentioned in the annual report should they decide to end the partnership, tend to learn an expensive, frustrating lesson. I don't think partnering with an American company is different in that respect. The strong tend to eat the weak.
Last edited by whodidntante on Tue Jul 14, 2020 8:24 pm, edited 1 time in total.
srt7
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by srt7 »

Well, in other news, I fired Vanguard.

Off to research between Fidelity vs. Schwab vs. ???
I can't think of anything more luxurious than owning my time. - remomnyc
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by srt7 »

brianH wrote: Tue Jul 14, 2020 7:52 pm
Kenkat wrote: Tue Jul 14, 2020 7:27 pm Everybody wants everything cheaper as long as it doesn’t affect our own high paying jobs.
It's interesting, because in the Vanguard lore, admiration was awarded (and deserved) to Jack Bogle, who's lack of greed and principles made him merely a couple hundred-millionaire instead of a billionaire many times over like he could have been. I wonder what he would think about the loss of American jobs to save a buck.
Jack would have never allowed this to happen. Which is why "they" waited until he passed away.
I can't think of anything more luxurious than owning my time. - remomnyc
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LazyNihilist
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by LazyNihilist »

SB1234 wrote: Tue Jul 14, 2020 8:18 pm Really surprised at all the teeth-gnashing about this news. This is exactly what happens in capitalism. Especially here.
The idea is that money saved can be used in better ways.
Lesson for everyone still working to be always prepared for something like this happening to you.
Don't be surprised when someone moved your cheese.
A head scratcher for me too. This is a much more milder form of 'out-sourcing' than usual. It's been going on since the 70's and 80's.
The strong do what they can and the weak suffer what they must -Thucydides
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Tdubs »

brianH wrote: Tue Jul 14, 2020 6:58 pm
prad81 wrote: Tue Jul 14, 2020 6:41 pm
McGilicutty wrote: Tue Jul 14, 2020 6:34 pm Is this a case where Vanguard is bringing in a bunch of H-1Bs to replace American workers?
No, this is a case where well-paying American jobs are outsourced to foreign companies and sent to India. In a couple of years, Infosys will reduce the 1300 head-count to about 30 onsite coordinators in the US and the rest of the work will be performed in India. This is their tried-and-tested operating model.
That's exactly what this is. Infosys is the biggest abuser of the H1B program in the US, and they also have a large offshore contingent.

I know people that work there, and I live near the Malvern office. This is a dirty move by them, and I will be moving as many assets as is practical to Fidelity -- there's no longer a moral argument to be made for Vanguard.
Does Fidelity do this? Or Schwab? Morgan?
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by raddoc101 »

nydoc wrote: Tue Jul 14, 2020 7:52 pm It’s already happening in medicine. Radiology has been outsourced. Low cost NPs and PAs replacing drs. Soon surgeons will be replaced with robotic surgeons sitting somewhere else. Capitalism at its best.
Radiology has not been outsourced. You have to be US trained to read the vast majority of imaging in the US. 5 yr US residency (plus 1 yr fellowship for 90%+) or 4 US fellowship years if you did residency abroad. Occasionally, (typically) less qualified US physicians from other specialties will interpret studies, but that’s a whole other story.

Medicare mandates that final reads be read in the US. You can read Medicare prelims or third party finals from Australia, but you’d still have to be US trained.
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Re: "More than 425 funds"

Post by abuss368 »

Taylor Larimore wrote: Tue Jul 14, 2020 7:58 pm Bogleheads:

I assume Vanguard knows what it is doing -- certainly more than we know. Nevertheless, I wonder about this:
"The firm, headquartered in Valley Forge, Pennsylvania, offers more than 425 funds to its more than 30 million investors worldwide."
Best wishes
Taylor
Jack Bogle's Words of Wisdom (to his employees): "My firm-wide standard of conduct, applied universally to officers and crew alike: "Do what's right. If you're not sure, ask your boss.""
That is incredible. Not sure how to wrap my head around that.

I hope Vanguard knows what they are doing!
John C. Bogle: “Simplicity is the master key to financial success."
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Re: "More than 425 funds"

Post by RocketShipTech »

Taylor Larimore wrote: Tue Jul 14, 2020 7:58 pm
Jack Bogle's Words of Wisdom (to his employees): "My firm-wide standard of conduct, applied universally to officers and crew alike: "Do what's right. If you're not sure, ask your boss.""
What a strange corporate value. Passing the buck up the chain is to be encouraged?

Here are two better values from companies I've spent time at:

1. Ask yourself how what you're about to do would reflect upon the Firm if it was front page on the Wall Street Journal.

2. No shenanigans. If you have to ask yourself if it's shenanigans, it's probably shenanigans.

Vanguard would do well to take these two to heart.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by jay22 »

Brb. I will move my funds to Fidelity while I type this on a smartphone made in Asia while wearing a shirt that was made in another Asian country.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Pomegranate »

Trader Joe wrote: Tue Jul 14, 2020 7:20 pm
prad81 wrote: Tue Jul 14, 2020 6:32 pm https://www.prnewswire.com/news-release ... 93262.html

The only winner here is Infosys.

This is definitely bad for their employees, as I have witnessed a very similar layoff where my employer handed over their IT dev and operations to Infosys and the employees were "re-badged" as Infosys employees. Fast-forward 12 months, Infosys will let most of them go, and will low-ball the salaries for the ones who are still around.

This does not bode well for Vanguard's customers, us, as Vanguard is yet another cash cow for Infosys and there will be no focus on customer experience.

I hope I am wrong.

Thoughts?
Great news. Hopefully my Vanguard costs will now be reduced even more moving forward.
Yup, but get ready for security breaches, services unavailable and ‘great‘ talks with the customer service :mrgreen:
Moving my funds out :sharebeer
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by sycamore »

Starfox wrote: Tue Jul 14, 2020 7:41 pm Almost all my money is in taxable and in VFIAX. I know I can tax free convert to VOO and move to Fidelity but is there other like-kind non taxable action/event ways to move from one sp500 fund family to another, if things turn worse for VG, or better for another brokerage?
No way I know of, except to wait for a market crash bad enough that you could tax loss harvest out of VOO and then into IVV (iShares S&P 500 ETF).
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by SB1234 »

LazyNihilist wrote: Tue Jul 14, 2020 8:25 pm
SB1234 wrote: Tue Jul 14, 2020 8:18 pm Really surprised at all the teeth-gnashing about this news. This is exactly what happens in capitalism. Especially here.
The idea is that money saved can be used in better ways.
Lesson for everyone still working to be always prepared for something like this happening to you.
Don't be surprised when someone moved your cheese.
A head scratcher for me too. This is a much more milder form of 'out-sourcing' than usual. It's been going on since the 70's and 80's.
Yes very easy to fix the problem for anyone here shedding fake tears about this move.
Just pay more taxes to Uncle Sam. Problem solved.
anecdotes are not data
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tvubpwcisla
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by tvubpwcisla »

Very smart move by Vanguard. They need to focus on investing, optimizing their index funds, lowering costs for investors, and keeping their eye on the money ball. I love and support this strategic move!

:moneybag
Stay invested my friends.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by whodidntante »

Can those who committed to leave Vanguard over this please update us once you've done so? And also, earn a brokerage transfer bonus if you can, since you're going to the trouble of moving assets anyway. It's really easy to do. I've done dozens of transfers at this point with fantastic results.

Also, are you going to liquidate all Vanguard funds, or does your discontent only extend so far as to leave Vanguard as your broker?
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by whodidntante »

tvubpwcisla wrote: Tue Jul 14, 2020 8:46 pm Very smart move by Vanguard. They need to focus on investing, optimizing their index funds, lowering costs for investors, and keeping their eye on the money ball. I love and support this strategic move!

:moneybag
Well, I don't see how it can make their website and back end systems any worse. :twisted:
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by RocketShipTech »

whodidntante wrote: Tue Jul 14, 2020 8:48 pm Can those who committed to leave Vanguard over this please update us once you've done so? And also, earn a brokerage transfer bonus if you can, since you're going to the trouble of moving assets anyway. It's really easy to do. I've done dozens of transfers at this point with fantastic results.

Also, are you going to liquidate all Vanguard funds, or does your discontent only extend so far as to leave Vanguard as your broker?
I can't think of a single Vanguard fund that doesn't have an equivalent (or better) replacement elsewhere.

And that includes Wellesley.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Mr. Rumples »

I wonder where the data is going to be housed. In the US or overseas? What laws apply? All of these companies have disaster recovery plans. Naturally, they are kept pretty close to the vest in case of a cyber attack. Will the backup be housed in the US or overseas?
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by boglenomics »

The problem with this is the risk it presents to the reliability and security of the software. Outsourced contractors if not very careful in selection will lead to degradation of the product since they are less loyal to the company and have less at risk if things don't go according to plan. They're incentivized to care less compared to a FTE who has tied bonus and stock incentives on the line along with the potential for future salary increase.

I'm an IT project manager and it's a vicious cycle I've witnessed, they outsource to offshore and then realize the terrible tech debt that has been created and customers depart. Most of the time it was really too many cooks in the kitchen to begin with. A small centralized highly skilled engineering team with the right incentives and local to HQ with little management overhead can be more effective than the average engineering team 10x the size.

A shame to see Vanguard go this route, this move puts them at serious risk of crippling tech debt. This is a perfect highlight of the flaws in American management.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Starfox »

:dollar
sycamore wrote: Tue Jul 14, 2020 8:42 pm
Starfox wrote: Tue Jul 14, 2020 7:41 pm Almost all my money is in taxable and in VFIAX. I know I can tax free convert to VOO and move to Fidelity but is there other like-kind non taxable action/event ways to move from one sp500 fund family to another, if things turn worse for VG, or better for another brokerage?
No way I know of, except to wait for a market crash bad enough that you could tax loss harvest out of VOO and then into IVV (iShares S&P 500 ETF).
Yikes. That would be a scary event. I TLH everything into VFIAX this year at ~206 which ended up being all time low for the year. For better or worse it looks like I’m married to Vanguard; if the IT system or web interface gets worse I guess my best option is to convert to VOO ETF and move to another brokerage.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by donaldfair71 »

I don’t understand the issues people are having with this move. It’s what has happened and will continue to happen with jobs for decades in this country.

Is this the line, we’ll deal with inexpensive outsourcing until it’s our brokerage, that’s the step too far? Serious question.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by TropikThunder »

LazyNihilist wrote: Tue Jul 14, 2020 7:17 pm While the 1300 employees are not laid off, they are moved to Infosys. This should lead to lower overall expenses for Vanguard, which in turn means more money in the pocket of Vanguard Investors. I see this as a win for Vanguard customers.

In time the jobs will be out sourced to H-1B's.
In time those jobs will be out sourced to India (or other lower income countries).
In time those jobs will be automated.

Each step of the way, we as customers of Vanguard keep winning. :moneybag
Username checks out. :P
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SB1234
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by SB1234 »

boglenomics wrote: Tue Jul 14, 2020 8:57 pm The problem with this is the risk it presents to the reliability and security of the software. Outsourced contractors if not very careful in selection will lead to degradation of the product since they are less loyal to the company and have less at risk if things don't go according to plan. They're incentivized to care less compared to a FTE who has tied bonus and stock incentives on the line along with the potential for future salary increase.

I'm an IT project manager and it's a vicious cycle I've witnessed, they outsource to offshore and then realize the terrible tech debt that has been created and customers depart. Most of the time it was really too many cooks in the kitchen to begin with. A small centralized highly skilled engineering team with the right incentives and local to HQ with little management overhead can be more effective than the average engineering team 10x the size.

A shame to see Vanguard go this route, this move puts them at serious risk of crippling tech debt. This is a perfect highlight of the flaws in American management.
I think what you say makes sense. But one thing I have noticed not just with my employer but generally, is that the core functions (money makers) still are kept in house while non core increasingly being outsourced.
Sometimes it's just not practical to maintain a large IT team and have them under utilized.
anecdotes are not data
Mr. Rumples
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Mr. Rumples »

The flip side of this is what happens if the contract is canceled. While different in many ways, there are similarities with what happened when the Commonwealth of Virginia outsourced its computer support to Northrup Grumman. In the end, after the honeymoon was over, it was a 30 month long legal battle with each suing the other. Would Infosys hold the personal data hostage in negotiations?

https://roanoke.com/news/virginia/vita- ... 20bc8.html
Last edited by Mr. Rumples on Tue Jul 14, 2020 9:09 pm, edited 1 time in total.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by wootwoot »

I thought bogleheads loved low costs....
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by marcopolo »

Elysium wrote: Tue Jul 14, 2020 8:57 pm The amount of ignorance and xenophobia displayed on this thread by many is so unremarkable.

Vanguard IT has failed to deliver over the years, everyone know this, people complain about the glitches and quality of tech endlessly. There are complaints about trades and transactions not happening as expected, although I never had issues myself since I am not very active.

I did not hear one comment about possibility of Tech improving from this move, why I wonder? are we so afraid of some tech company in India might actually make improvements to Vanguard that it's American workers could not, for whatever reasons.

Let us wait and see what comes out this move down the line, as Infosys takes over the IT and work through the issues. Perhaps they will improve the platform and make Vanguard more competitive to match Fidelity or Schwab, while keeping costs low. In the event they won't then Vanguard can always fire them and go with another provider. The days of in-house IT is so outdated, especially a company whose core competency is not Tech has no business running it's own IT department.

Personally, I think Infosys is cheaper and lower quality than IBM, but are we prepared to pay the fees required by IBM to run IT for Vanguard'?
Oh, but I forgot IBM is now run by an Indian, forget it :oops:
My thoughts exactly. The knee jerk xenophobia is quite disappointing.
Once in a while you get shown the light, in the strangest of places if you look at it right.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by gubernaculum »

Where does it say that they are getting laid off?
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by boglenomics »

SB1234 wrote: Tue Jul 14, 2020 9:03 pm
boglenomics wrote: Tue Jul 14, 2020 8:57 pm The problem with this is the risk it presents to the reliability and security of the software. Outsourced contractors if not very careful in selection will lead to degradation of the product since they are less loyal to the company and have less at risk if things don't go according to plan. They're incentivized to care less compared to a FTE who has tied bonus and stock incentives on the line along with the potential for future salary increase.

I'm an IT project manager and it's a vicious cycle I've witnessed, they outsource to offshore and then realize the terrible tech debt that has been created and customers depart. Most of the time it was really too many cooks in the kitchen to begin with. A small centralized highly skilled engineering team with the right incentives and local to HQ with little management overhead can be more effective than the average engineering team 10x the size.

A shame to see Vanguard go this route, this move puts them at serious risk of crippling tech debt. This is a perfect highlight of the flaws in American management.
I think what you say makes sense. But one thing I have noticed not just with my employer but generally, is that the core functions (money makers) still are kept in house while non core increasingly being outsourced.
Sometimes it's just not practical to maintain a large IT team and have them under utilized.
From what I read they cut the entire 401(k) team (~5-10% of their total work force). I'm sure some architect(s) will be overseeing things still but do not see that going over well and making that drastic of a change I consider to be reckless behavior for a financial services company. There's no way all data, security and infrastructure can be properly managed with such a large transition.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Elysium »

I have worked with Infosys people a long time ago on a project where they tried outsourcing partially, they are not low skilled people, not all of them, although there is a limit to the amount of high skilled people you can actually get in order to meet the insatiable demand for IT skills. When there is a need for volume there will be several that are hired at the lower end of the skill sets to meet the numbers, then the high skilled people will end up being supervisors and leaders. This is true even for American companies, the top consulting outfits match one senior high skilled Tech worker with at least five low to moderate skilled worker, and/or fresh out of college graduates who are learning basics, some with English majors and not CS background gets into companies like IBM and Deloitte for $90K a year. But they do speak and present well, thus providing a false sense of quality that doesn't exist. Even if you wish to hire from IBM, they cannot match the demand for numbers, so what will they do, end up outsourcing to their Indian center where they can find people. It's simply a matter of skills, very few of our kids actually wants to learn Comp Sci.
Last edited by Elysium on Tue Jul 14, 2020 9:17 pm, edited 4 times in total.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by palanzo »

LazyNihilist wrote: Tue Jul 14, 2020 7:17 pm While the 1300 employees are not laid off, they are moved to Infosys. This should lead to lower overall expenses for Vanguard, which in turn means more money in the pocket of Vanguard Investors. I see this as a win for Vanguard customers.

In time the jobs will be out sourced to H-1B's.
In time those jobs will be out sourced to India (or other lower income countries).
In time those jobs will be automated.

Each step of the way, we as customers of Vanguard keep winning. :moneybag
Winning and customer service sinks to new lows. Wonderful.
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by SB1234 »

marcopolo wrote: Tue Jul 14, 2020 9:09 pm
Elysium wrote: Tue Jul 14, 2020 8:57 pm The amount of ignorance and xenophobia displayed on this thread by many is so unremarkable.

Vanguard IT has failed to deliver over the years, everyone know this, people complain about the glitches and quality of tech endlessly. There are complaints about trades and transactions not happening as expected, although I never had issues myself since I am not very active.

I did not hear one comment about possibility of Tech improving from this move, why I wonder? are we so afraid of some tech company in India might actually make improvements to Vanguard that it's American workers could not, for whatever reasons.

Let us wait and see what comes out this move down the line, as Infosys takes over the IT and work through the issues. Perhaps they will improve the platform and make Vanguard more competitive to match Fidelity or Schwab, while keeping costs low. In the event they won't then Vanguard can always fire them and go with another provider. The days of in-house IT is so outdated, especially a company whose core competency is not Tech has no business running it's own IT department.

Personally, I think Infosys is cheaper and lower quality than IBM, but are we prepared to pay the fees required by IBM to run IT for Vanguard'?
Oh, but I forgot IBM is now run by an Indian, forget it :oops:
My thoughts exactly. The knee jerk xenophobia is quite disappointing.
LoL. IBM. That's one of the biggest proponents of this business method.. Layoff in the 10s of thousands here and hire hundreds of thousands india. This is not your dad's IBM.
anecdotes are not data
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Re: Vanguard laying off 1300 employees as part of outsourcing deal with Infosys

Post by Grt2bOutdoors »

Normchad wrote: Tue Jul 14, 2020 7:12 pm
TheTimeLord wrote: Tue Jul 14, 2020 7:06 pm Sounds like a good reason to communicate with Vanguard.
You can always vote with your feet.....

Just remember, this isn't India stealing America jobs. These are Americans doing this.....

They are constantly building new bank branches around Northern Virginia. And I just can't understand why. It obviously costs money to build one, and costs money to plop 2 people in there every day. I basically never step foot in a bank, and I don't know many people who do. I think the entire banking industry is ripe for big staff reductions. Really, can't almost everything they do be automated away at this point?
No it can't, but if you don't mind I'm sure someone someplace won't mind automating your money away from you. :twisted:
There are many processes that are manual and labor intensive - a machine or robot is not going to keep a closer eye on your money than a human. Banks are very profitable if you offer the right services to the right clientele. If you want to know why there are new bank branches going up it's simple - it's because that is where the money is. Why borrow money in the open markets when you can fund it for cheap? A building and 2-5 people is not a huge burden on a bank, the bigger costs revolve around technology and regulatory/compliance costs.
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