My brother Mark turned me onto an article on EE Times. "Bangalore boom looks like Valley's heyday," written for chip designers, actually has some good advice for people who are looking to India for other kinds of services as well. Reporter Anthony Cataldo writes:
If there's one irrefutable piece of advice for companies just starting out in India, it's to let Indians run the Indian operation. No matter how good their intentions, foreigners are not as sensitive to the customs and cultural norms that Indians take for granted. That can lead to false expectations.
It's also important that employees see Indians in management roles. "If there's local leadership, an employee sees a career path," said ST's Kumar. "If everything is being driven by [managers from] another country, he's not seeing it. With local leadership, there's a better challenge and a better future. This is the key to success."
You'll find more in the article, including pay ranges for various levels of engineers and managers.