offshore development in a global company
TRANSCRIPT
The Offshoring Decision
• Why investing in creating an offshore Branch if we can:– Work with an outsourcing vendor on
ODC basis– Work with an outsourcing vendor on
T&M basis– Work with an outsourcing vendor on
a project/fixed price basis
The Offshoring Decision
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# of Developers
Monthly Cost ($)
OutsourcingCost
InhouseOverhead
Direct InhouseCost
In house vs. Outsourcing
The Offshoring Decision
• Expect internal opposition to the move– People will feel threatened
• Market the change to the onsite stuff– Advance in the career ladder by being
responsible of an Offshore team/group/project
– Focus on innovative and core activity and not the tedious repetitive work
– Gaining experience in a global company
Location, Location, Location
• Where do we open the branch:– Local Labor cost – Local Universities level and proximity– Local level of English– Corruption – is it feasible doing
business there? – Proximity to international airport– Number of High-Tech companies in the
region• HR Competition• IT Infrastructure
Onsite-Offshore Team Structure
• Horizontal (onsite management-offshore R&D):– High rate of interaction between onsite and
offshore teams– Bitterness of the offshore employees– Less productive
• Vertical (offshore management-offshore R&D)– Risk of loosing control
• Best Practice – vertical teams peripheral projects
Structured Development Process
• Well defined Development Process– Roles and responsibilities– Well defined documentation– Just enough documentation
• Agile Development / Light CMM
Choose Offshore Projects Wisely
• Not everything can and should be offshored!– Minimal interaction with onsite
groups– Well defined interfaces– Loosly-coupled architecture – SOA!
Cultural and Mentality Gaps
• This is the number one problem of offshore in general – a major hidden cost
• Acknowledge the fact that they don’t think, behave and act like us!
• Encourage social activity • Ambassadors exchange program (next…)• Cultivate corporate culture
– Procedures, Intranet and even blogs
• Positive Strengthening - encourage questions
Effective communication
• Number two problem of Offshore Development – yet another hidden cost
• Exchange ambassadors– Send offshore stuff for onsite training– Send team/group leaders to get to
know their offshore stuff– Send business analysts and project
Managers to offshore – Send offshore stuff to customers
Effective Communication
• Every communication tool has its pros and cons – use all of them wisely:– Documentation – E-mails– Voice calls– Audio conferencing– Video Conferencing– Instant Messaging– Wiki– Web Demo Systems (such as WebEX)
Fighting Attrition Rate
• This is the number three problem of offshoring projects – again – hidden cost
• Attrition rate is very high in developing countries
• Provide on-going trainings, preferably ones with world-wide certification
• Provide titles for employees to make them feel significant
• Create personal programs for employees– Housing, Loans– Cars