Squirrel delves into the misconception that outsourcing engineers overseas automatically leads to cost reduction in software organizations. He explains that while the salary expenses might be lower for offshore teams, other costs come into play.
He illustrates the situation with an example involving two tech teams, one located onshore in California, USA, and the other in India. The Indian team had one quarter the salary of the onshore team, prompting the question of why the more expensive US engineers are retained. The discussion highlights the importance of evaluating the genuine costs of offshoring beyond just salaries. Additionally, Squirrel raises the question of which team is more productive and points out the time zone difference as a significant factor impacting communication and coordination.