subcontractor management offshore outsourcing: the goods, the bads, and the uglies andrew r....

Subcontractor Management

Offshore Outsourcing: The Goods, the Bads, and the

Uglies

Andrew R. Iserson, MS, PMPPMI PresentationJanuary 23, 2014

Agenda

• Why companies go offshore• Picking an offshore vendor• Setting levels of

expectations• What I experienced• What I would do differently in

the future

My Experience

• Systems Development• Staffing in India• Use of two companies

– One large– One mid-sized

Why do companies go Offshore?• Save money?• Save time?• Pick up skills the

organization doesn’t have?• Upgrade processes?• Staff augmentation?• Public relations?

Why Go Offshore: The Goods

• Save Time• Skills you can not staff• Staff augmentation• Public Relations

Why Go Offshore: The Bads

• Save money

Why Go Offshore: The Uglies

• Save time• Skills you can not staff• Staff augmentation• Upgrade processes• Public Relations

Picking an Offshore Vendor

• Sales people• Will do ANYTHING you

want • CMMI Level 5• Local presence of vendor• Understand why you are

outsourcing• Different levels of vendors

Picking an Offshore Vendor: The Goods

• Local presence of vendor• Understand why you are

outsourcing• Different levels of vendors

Picking an Offshore Vendor: The Bads

• Good sales people• Will do ANYTHING you want

Picking an Offshore Vendor: The Uglies

• CMMI Level 5

Possible Expectations of the Relationship• Add and subtract staff as needed• Pick up unique skills• High quality work• No need to manage the

contractors• On-time delivery• Cost savings• Good communications• (Vendor) Future Acct Growth

Possible Expectations of the Relationship: The Goods

• Easily add staff as needed – sometimes

• Pick up staff with unique skills - sometimes

Possible Expectations of the Relationship: The Bads

• Quality of work is no better than at home

• Need to actively manage the contractors

• On-time???

Possible Expectations of the Relationship: The Uglies

• Cost savings• Communications• Future growth of your

account

What I found

• Amount of work• Quality of work• Institutional knowledge• Business model• Availability of consultants• Legal issues• Confidentiality• Cultural issues• Time differences• Communications• Costs

What I found: The Goods

• Amount of work• Availability of consultants• Confidentiality• Cultural issues• Time differences• Communications

What I found: The Bads• Quality of work• Institutional Knowledge• Cultural issues• Time differences• Communications

What I found: The Uglies• Business model• Legal issues• Cultural issues• Costs

Changes I would make in the future

• Be selective on the work sent• Visit more often• TESTING• Understand reasons that you

are doing this• Set reasonable expectations

Questions?