Quality of Life in a Global Game Industry
The rise of game development studios across the globe and the increased use of offshore and inshore outsourcing could have developers feeling like they are losing leverage in making arguments for good quality of life practices. But, does globalization and the ability to outsource work really abdicate the need for quality of life both at home or abroad?
This article examines the issue of Quality of Life (QoL) in the context of a global video game industry. It examines the ways in which the hidden costs of poor quality of life, such as, staff churn, rework, schedule slippage, and lost sales negatively impact bottom lines. Mechanisms for approaching management are discussed, what are they interested in hearing? Is making the argument to management purely a numbers issue, or is management interested in other metrics? Each of these areas are examined in the context of globalized game production and provides developers with new levers for making QoL arguments.
When the talk which this article is based on was given at GDC 2007, it was interesting that the majority of attendees were not rank and file developers, and were instead managers and producers concerned how to handle the complex issues of QoL and a quickly globalizing video game industry. In part this reflects a broader understanding of QoL issues as being a problem which the industry must face from a top-down perspective rather than from the bottom-up. Publishers, studio managers, producers, and leads must all face QoL concerns head on. It is also the perspective of this researcher that more needs to be done at the level of hardware manufacturers to provide resources for developers to better address the complex set of issues that ultimately lead to poor QoL.
This article examines QoL in the context of globalization in the video game industry. It begins by examining the current state of off-shoring in the video game industry. How much offshoring is going on, what kind of activities are being outsourced, what has worked, what hasn't, and an introduction into the kinds of companies doing offshore work. The article briefly addresses the danger of perceiving video game developers from other countries as enemies, rather than fellow developers in emerging game industries who face many of the same problems as the dominant industry workers. This is followed by examining some of the costs associated with bad QoL practices, and updates some of the numbers previously available. This is cross referenced with data gathered about the kinds of difficulties frequently encountered in game development off-shoring projects. The conclusion points to the interconnections between the very processes that improve QoL at home and the successful use of off-shoring.
Ultimately the article seeks to answer the question, "Are we losing leverage for arguing for higher QoL in the context of a global game industry?" The hopeful answer is that one requires the other. Globalization has already become a reality for those working in the video game industry, but this provides us with more arguments for improved QoL.
Hard Questions We Need to Ask
- Is Good QoL Incompatible with the Global Game Industry?
- Is Good QoL Incompatible with the Game Industry?
In the process of speaking with developers in both emerging and established video game industries many have voiced their concerns and curiosity about the consequences of globalization on their workplaces. More generally, many wonder how exactly the game industry is planning on growing up and figuring out how to offer a sustainable workplace for its employees, because many believe it simply hasn't happened yet.
Others still speak as if worrying about good QoL is a waste of time and breath. That there is something fundamentally different about the process of video game development that makes it either unmanageable, or that manageability is undesirable. That poor QoL is just a fact of life for game developers.
The Rise of Global Video Game Production
Over the last several years the global production of video game development has spread rapidly and accelerated with the release of next generation platforms like the Playstation 3 and Xbox 360. For the most part, the centers of the game development world remain largely in The United States, Western Europe, and Japan. Recently, other players have begun to take the stage. Studios have taken root in Russia, Eastern Europe, India, China, Korea, and Vietnam. All have made concerted efforts to become involved in the global industry and gain recognition in the eyes of the dominant players.
While existing numbers indicate that only about 60% of game companies currently outsource work, this number is expected to rise to nearly 90% as game companies, like other fields, attempt to capitalize on the global labor market. These numbers do not exclusively indicate the expected use of offshore outsourcing, rather they point only to companies looking to outsource some component of their development process. However, as companies in emerging industries prove themselves proficient at producing the desired products of game development, the ability for companies to take advantage of global differences in labor and money markets will likely drive many companies to look offshore.
For the most part, game companies have found the greatest levels of success outsourcing a limited number of aspects of the development production process:
The single largest component of video game outsourcing seems to come from the production of art and audio assets. While localization and porting are also done frequently using external contracts, they make up a smaller percentage of the whole. Proportionally, porting largely refers to mobile markets, where the large number of handsets and carriers frequently requires a major investment in resources. Generally, engineering, pre-production, or complete product development is not being outsourced.
In some respects, the move to next-generation consoles has spurred companies to look for cheaper production of game assets, offshore, inshore, or simply wherever they can get them to meet production deadlines. Some developers have indicated that new consoles have increased production costs by 50% or more. Many developers have pointed to a shift from projects being engineering bound to games being asset bound. Put another way, more of the total cost of developing games comes from the creation of content rather than the development of new technologies or game mechanics. As more companies look to develop for top of the line hardware, this trend of looking to other sources for the creation of game assets is only going to increase. Of those companies outsourcing, 43% have moved some aspect of their art production offsite.
Developers in countries with already established game industries need to recognize that there is no unified "them" looking to steal jobs away from those who would "rightly" have them otherwise. Many of the companies providing the services which US and Western European companies are now contracting started up not unlike their curent clients. There is a whole spectrum of companies springing up to take advantage of the opportunities offered by businesses looking to offshore work. My experience working with developers in India identified three categories of companies (also recognizing that many companies are a mixture):
- Pure Services Companies - These companies are focused singularly on providing services to clients, filling the role of flexible labor in the production process. The primary goal in the context of the global industry is to capitalize on differences in the cost and availability of labor.
- Service Companies Eyeing Domestic Markets - These companies provide services but do not view it as their core business. Instead services are used as a means of funding the development of games aimed at local markets.
- Service Companies Eyeing Global Market - These companies, like those focused on local markets, provide services as a means to fund the development of games aimed at the global game market.
It is also important to recognize that there are significant limitations to the kinds of relationships that developers in dominant markets have been willing to enter into with developers in other countries. For the most part console manufacturers and publishers have not authorized developers in emerging markets to develop games for their systems. In many cases consoles are not even marketed in these locations. Instead these markets have largely developed on their own, frequently focused on mobile, web, and PC based game development. While these limitations are slowly being lowered, it does affect the ability for developers in these companies to get access to the resources which many developers in existing markets take for granted. Developers in these locations also frequently face difficulties which affect QoL that other developers would never have imagined facing. The limitations of power grids, importation of expensive equipment, government bureaucracies, or simply nature. These QoL concerns become the concerns of contractors, because they inevitably affect the final product.
Just examine the Game Dev Map (or the recently released and Google Map savvy Game Industry Map) and you'll see that regardless of arguments on either side of the globalization debate it has become a reality for game developers, and we need to learn how to make arguments for QoL within this framework.
"Outsourcing Rattles the Skeletons in the Closet"
These words by THQ's Shiraz Akmal point to the single best point of leverage for game developers hoping to argue for improved QoL even in the context of offshore/inshore outsourcing. As companies from numerous other industries have learned the hard lessons about what works and what doesn't when it comes to outsourcing. While you might argue again that the game industry is just fundamentally different, these lessons are fundamentally basic:
- A Companies Core Competencies are Reinforced through Outsourcing - Companies get the most out of outsourcing those processes they have a thorough understanding of. Outsourcing allows companies to more effectively do what they do well, and maximize resource allocation.
- Weaknesses Quickly Rise to the Surface when Outsourced - If something doesn't work in house, it will never work outsourced.
- Most Frequently Reported Problems are Quality and Scheduling - Oddly most game companies seem to have these same difficulties in house.
The point simply is that outsourcing doesn't let a company off the hook for poor practices (QoL or otherwise). It actually adds a new layer of organizational complexity. It may provide flexibility and greater production capacity, but it is not a substitute for critical analysis of one's organization.
This simple fact actually gives developers new levers which they can examine in their organization to make arguments for improved QoL. By examining where their organization is paying for poor QoL practices. Rather than losing leverage in the context of inshore or offshore outsourcing, developers can actually make the case that outsourcing exacerbates the existing costs of poor QoL.
High turnover rates are often a product of and contributor to poor QoL. Turnover costs companies on average $32,000 per person. This includes the cost of looking for people, getting them signed, and ramping them up on a project. This doesn't even take into account the often highly specialized skill set necessary for game developers, and the highly customized tool chains that they often end up working with. Given that game companies often claim to be both inundated by applicants, but also unable to find the qualified talent that they want, these figures may be extremely conservative in the game industry.
The high cost of turnover is further complicated by the fact that despite game developers wanting to stay in the industry, many expect to last only 5 to 10 years in the work conditions.
- 47.2% of Developers want to stay in the game industry for their entire career.
- 34.3% of Developers expect to leave the game industry within 5 years.
- 51.2% of Developers expect to leave the game industry within 10 years.
These numbers only get more complicated as you look at offshore outsourcing. Turnover rates in emerging economies are actually higher. Employers end up competing to keep employees around. In the case of video game development, for the most part the youth of these newly emerging industries haven't even been around enough for developers to accumulate 5 years worth of experience. Those that do have experience are often pursued by other companies with significant investor support. Most employers have begun to realize that the battle for their employees can not be won monetarily, that what keeps the best employees around are the more intangible aspects, like QoL.
Senior employees actually represent, in a tangible human form, the ability of organizations to retain knowledge and experience. The study of work, workplaces, and work culture has taught us that the majority of institutional learning goes undocumented, and is passed down through formal and informal social networks. This is more frequently the case in the context of complex and frequently changing technological systems, which may prove even more extreme in the game industry.
Rework is typically sited as one of the key areas of concern related to poor QoL. Rework is often at the root of schedule slippage and overtime, and as recently noted by a well known developer, as much as 60% of production work can be rework. In the case of well run projects, rework rates can be as low as 20%. Again, these numbers only get more complicated as you start to consider offshore or inshore outsourcing. Change orders for existing contracts tend to be one of the most expensive aspects of outsourced work. In the case of game development, where frequently more than half of the production work is re-work, these numbers become prohibitively expensive very quickly. In the case of emerging industries, again experience will play a significant factor in the amount of rework necessary. In many cases experienced developers will "just do things in a certain way" because experience has taught them that it's just more likely to work that way. For those who have yet to experience that, or if those requirements are not adequately specified, rework will plague the relationship. Where companies seem to have the most success is in the context of sequels or games where only production work is necessary. These games frequently have well defined pipelines, which allows development teams to get things done with minimal rework.
Many game studios in emerging economies are attempting to prove themselves to publishers and developers alike in already established markets, and for the moment may be willing to take projects that force them to absorb the costs associated with rework. However, this will likely be only temporary as these companies are forced to compete with one another and with other industries expanding in these markets. Many managers in these locations have already recognized that QoL is a major business concern, though they may struggle to make those concerns a reality.
Schedules are one of the most frequently cited causes of poor QoL. Most developers point to poor pre-production as the most significant impacter of schedule slippage. Only 13.5% of developers believe that pre-production teams are able to adequately predict production timelines. In part this can be traced to the relative youth of game development methodologies, the frequent cycling of technologies and hardware, and in many cases developer turnover. Taken in the context of a globalizing industry, these costs only increase. In most emerging industries, because the focus has been on providing production services, pre-production is largely unexperienced, making it even more difficult for teams to accurately predict timelines. Further complicating the matter is that frequently by the time a company is looking to move work outside, they are already time restricted. Companies wait to look to outsource until they're already behind schedule.
Ultimately schedule slippage costs companies money in some form or another:
- Missing a Holiday Season Rush
- Missing a Movie Tie-In Release Date
- Missing a Console Launch Window
- Missing Publicity at a Conference or Expo
Each one of these can cost a game company significantly in potential lost sales, lost publicity, or customer loyalty.
Cost: Bad Publicity
All of the previously mentioned costs of poor QoL directly impact a companies bottom line. However, as Electronic Arts can likely attest to, public perception of a companies QoL also matters. The rapidly globalizing game industry may actually intensify the importance of good QoL both at home and abroad. While for the most part people have a hard time imagining "sweat shop labor" in their own companies, a mental image quickly springs to mind when thinking about countries with emerging economies. Imagine for a moment, "ea_spouse_china" and the negative publicity something like that might cause for a development studio or publisher.
The following is an excerpt from a web forum posting in China, which has since been taken down. In the interest of protecting the individuals and organizations involved, identifying aspects have been removed:
This is a guy come from [location] studio. In this studio we over time
This f*cker studio manager [NAME]. tell us we must over time every day,
and he said if you don't I will be fire you! He pays all of our man just
a little salary, and never gives our over-time money. That's an
He is unscrupulous in his exploitation of people. I was amazed to see we
are all Chinese people, we are countrymen.
These situations only get more complicated as the industry globalizes (eg, another current case in India is popping up), and it is imperative that developers in the dominant industries recognize that this too is a lever which can be used to argue for higher QoL in the absence of other options. People do not like being reminded of the social cost of goods, and presumably the consumers of video games are no different.
The Necessity of Good QoL
One of the hardest questions to answer, while working with developers on QoL issues, has been, "What makes good QoL?" In many cases it seems that this is something that must be answered on a per-studio basis. It is also something that developers should openly share with others looking to join their organization. For some the ideal is working a 40 hour week. For others it is making the newest/most original IP. Some are more modest, hoping simply for improving the pre-production phases and ensuring team buy-in to the schedules it produces. For those working on the other end of contracts, simply asking for change control processes once production begins, or asking managers to effectively negotiate for the removal of features when other newer ones are asked for.
There are numerous aspects of day-to-day software development that are complicated significantly when projects are moved not only out of house, but to differing time zones. Some studios have turned to practices like:
- Core Hours
- Video Conferencing Rather than Email or Phone Conference
- Effective Change Control Processes and Negotiation
- Dismissal of the "Passion" or "We're Just Different" Arguments
- Adoption of Development Practices From Other Industries (ie. Scrum and xP)
Many hope to improve not only their QoL, but overall development processes. While it might seem romantic to think of game development as something wholly unique or unprecedented in the realm of human work and creative endeavors, it simply isn't the case. While wholesale importation of practices from other industries may not work, there is certainly something to be learned from what has proven successful for others.
As the process of globalization continues, some hope that developers in countries like India, who have been successful at managing software development projects and are willing to experiment with new business practices and processes, may succeed where the rest of the industry has largely failed.
This seems intricately linked to the ability for game development studios to learn from themselves and from one another about what works and what doesn't. Despite over a decade of postmortems published in Game Developer Magazine, the same kinds of mistakes are made time and again. While some might be willing to pay the costs for the time being, the question that begs to be asked, "Is it sustainable?" Many would indicate that a resounding answer to this question is, "No," that something must eventually give. For the industry to grow up an out of its perpetual start-up phase is going to take a concerted game developer effort.
Effective QoL practices at home end up being the same kinds of activities that are prerequisites for being able to inshore or offshore outsource work. Those practices which allow developers to better plan for themselves are necessary for being able to draw up any kind of agreement which savvy developers in other locations will be willing to take on. Of course in the beginning, there will be some developers in these emerging industries willing to take bad projects, in an effort to prove themselves, and they too will likely go through the growing pains that developers in the US, Western Europe, and Japan have already encountered. But it isn't inevitable, and many aren't going to just accept it as a fact of life as many developers already have. If the industry wants to grow up and play in the global market, it has to grow up first.
Related IGDA Links
- Discuss the article in the Quality of Life discussion forum
- IGDA quality of life initiatives
- Quality of Life White Paper
- Scrum Resources
- Barley, S. R. (1996). Technicians in the Workplace: Ethnographic Evidence for Bringing Work into Organizational Studies. Administrative Science Quarterly, 41(3), 404-441.
- Barley, S. R., & Kunda, G. (2004). Gurus, Hired Guns, and Warm Bodies: Itinerant Experts in a Knowledge Economy. Princeton, NJ: Princeton University Press.
- Barley, S. R., & Orr, J. E. (1997). Between Craft and Science: Technical Work in U.S. Settings. Ithaca, NY: Cornell University Press.
- Beck, U. (2000). The Brave New World of Work. Malden, MA: Polity Press.
- Beck, U. (2000). What is Globalization? Malden, MA: Polity Press.
- Bonds, S., Briant, J., Clingman, D., Howie, H., Laramee, F. D., LoPiccolo, G., et al. (2004). Quality of Life in the Game Industry: Challenges and Best Practices [Electronic Version]. IGDA Website. Retrieved February 5, 2007 from http://www.igda.org/quality-life-white-paper-info
- Creighton, S., & Hodson, R. (1997). Whose Side Are They On? Technical Workers and Management Ideology. In S. R. Barley & J. E. Orr (Eds.), Between Craft and Science: Technical Work in U.S. Settings. Ithaca, NY: Cornell University Press.
- Diamante, V. (2006). GDC Game Outsourcing Summit: "When Does it Work?" [Electronic Version]. Gamasutra. Retrieved February 5, 2007 from http://www.gamasutra.com/php-bin/news_index.php?story=10510.
- Diamante, V. (2006). GDC Game Outsourcing Summit Keynote: "THQ's Akmal Talks Game Outsourcing" [Electronic Version]. Gamasutra. Retrieved February 5, 2007 from http://www.gamasutra.com/php-bin/news_index.php?story=10476.
- Dooney, J. (2005). ROI Series: Cost of Turnover [Electronic Version]. SHRM Research. Retrieved February 5, 2007 from http://www.shrm.org/research/briefly_published/ROI%20Series_%20Cost%20of%20Turnover.asp.
- Friedman, T. L. (2005). The World is Flat: A Brief History of the Twenty-First Century. New York, NY: Farrar, Straus, and Giroux.
- Ghemawat, P. (2007). Why the World Isn't Flat [Electronic Version]. Retrieved March 29, 2007 from http://www.foreignpolicy.com/story/files/story3720.php.
- Jenkins, D. (2006). Report Predicts Massive Outsourcing Rise [Electronic Version]. Gamasutra. Retrieved February 5, 2007 from http://www.gamasutra.com/php-bin/news_index.php?story=8451.
- McConnell, S. (2005). Quality of Life Summit: The Business Case for Improved Production Practices [Electronic Version]. Gamasutra Postcard from GDC 2005. Retrieved February 5, 2007 from http://www.gamasutra.com/gdc2005/features/20050308/postcard-waugh.htm and http://www.igda.org/qol/events.php.
- Orr, J. E. (1996). Talking about Machines: An Ethnography of a Modern Job. Ithaca, NY: Cornell University Press.
- Paros. (2007). Cost-of-Turnover Worksheet [Electronic Version]. U.S. Department of Labor. Retrieved March 29, 2007 from http://www.dol.gov/cfbci/turnover.htm.
Casey O'Donnell is a PhD candidate in the Science and Technology Studies Department at Rensselaer Polytechnic Institute and has performed ethnographic fieldwork at Vicarious Visions over the past two years. His dissertation research titled, "Playing the New Economy: Video Game Development in India and the United States," is being funded by a National Science Foundation grant. His work examines the diverse forces and activities -- laws, technologies, collaboration, and workplace cultures, for example -- that shape video game development, and make it tenable in today's globalized economy. His broader research questions, "What can the everyday worlds of video game developers teach us about the 'new' economy?" and "How do these worlds differ across national and cultural boundaries?" links the game industry to global processes.
In a previous life, Casey was a computer scientist and mathematician, started studying computer graphics, that led to 3D scientific visualization work for JPL, was snatched up by a game company in La Jolla, worked on 3D sound systems for N64, PS1, PC, Mac, Linux until it('s clients) went bust, tried graduate school in CS, wasn't happy, worked for an Autodesk subcontractor (and general design automation company), put people out of work with automation tools, got tired of that, and with the help of a Marxist feminist and a sociologist found "STS" as a (un)discipline, got in, studied Open Source Software development for a while, got tired of it, did some pilot research studying work at a video game company, that company got bought by Activision, and decided to study "the game industry" in the US and India. Simple right?
Text Copyright © 2007 Casey O'Donnell.
Tyson Stecklein is Just your average, everyday, laid-back, typical, personable, orthodox, chainsaw-wielding, zombie-slaying, reasonable, semi-intelligent, humble, traditional, meat'n potatoes, t-shirt-and-jeans, spastic, lion-taming, problem-solving, 3D-tastic, animated, thrill-riding, down-to-earth, ninja-monkey-lovin', 30-something, guy by day, super hero by night, kinda guy. Yah, that's me. Basically.
Images Copyright © 2007 Tyson Stecklein.
The opinions expressed in this article do not necessarily represent the IGDA.