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"Xoriant Corporation is an offshore software product
development company with global delivery centers, offering a wide range of software
development engineering services like software testing, migration and porting services.
We offer these services to a variety of industries including finance, telecom, ecommerce,
customer-facing web publishers, and others."
Source: Xoriant Corporation
Outsourcing Best Practices
is also known as :
Off Shore Outsourcing
Offshore Outsourcing Best Practices
Offshore Outsourcing Engagement
Offshore Software Outsourcing
Offshore IT Outsourcing
Offshore Outsourcing Company,
Offshore Outsourcing Development,
Ofsshore Outsourcing Risk,
Offshore Outsourcing Services,
Offshoring and Outsourcing,
Offshore Business Process Outsourcing Best Practices,
Offshore Outsourcing Consulting,
Technology Offshore Outsourcing,
Offshore Outsourcing Benefits,
Offshoring IT Services,
Offshore Outsourcing Advantages,
Offshore Software Development,
Business Process Outsourcing Offshoring,
Offshore Outsourcing Solutions,
Offshore Outsourcing Provider.
Outsourcing: staying the course in the start-up world
It has become very common for start-ups to begin their entire product
development by leveraging companies offshore. From being a long-haul possibility
for large corporations with deep pockets, offshore outsourcing is accepted as a
natural phenomenon of business strategy for even the smallest of companies.
Industry reports assess the offshore outsourcing to touch $150 billion in 2010,
of which at least 13% will be contributed by start-ups in product engineering
and specialized outsourcing services.
So much so, in 2005-2006, the Craigslist has added over 20 new cities across the
globe—from Manila to Bangalore to Sofia, and so on. These lists see active
transactions exchanged—between buyers and sellers of offshore services, where
the largest level of interest appears to be in areas like web applications
development, custom software development in various domains, graphic design, and
independent testing and quality assurance. Other electronic bulletin boards like
Elance, Guru, ODesk, and OutsourcingWorld are providing robust environments for
start-ups to engage with remote companies through their trusted channels.
If one were to look a little deeper into the boards, many of them provide a
service ranking system, and platforms to rave and rant about the buyer
experiences. While the buyers are scrambling to hand out projects even as they
compete with a fickle market, the engagements have not been as uneventful or
helpful as forecast. Why? The raves are far outnumbered by the rants, and the
seller side seems to be completely uninterested in retorting or even salvaging
tarnishes. Why again? As a seasoned service provider that works closely with
start-ups—from early stages to mature companies—Xoriant Corporation has
assembled intelligence from the market, from the customers we have served as
well as from the user companies that we have interacted with. Even as the
venture funding explodes in new trend-driven development, the ground rules for
commencing, nurturing, and expanding an offshore engagement are oft forgotten.
From our experience in the past decades, we have created a list of some basic
do's and don'ts that will help you guide your company's initiative in the
offshore engagement. But before we get there, let us step back and ask a couple
of questions: when do you commence an offshore exercise, and why should you?
The answers will define the foundations of your offshore outsourcing engagement.
We have found that a start-up typically commences an offshore initiative almost
as soon as the business plan and prototypes are validated. To build a product
takes a lot of muscle—from conception to architecting, marketing, and selling,
where each component is a big cost initiative to the company, not only in terms
of direct dollar costs, but also in terms of management bandwidth. Even as the
company spends front-end cycles delighting the first reference customers, the
next solid version of the product has to be simultaneously built for the next
set of customers. Here is where the companies come up against a dilemma—how will
they build out the product and not miss the market window, while spending as
much local engineering bandwidth as possible to make the reference customer
implementations a grand success? This is a good instance where a specialized
offshore product engineering services partner can bring tremendous value.
To evaluate the reason for offshore, many list cost and convenience as valid
reasons. While these are true, time could be the most important element since
time-to-market can determine the success or failure of a software venture. An
offshore partnership brings in the value of time-savings to the table— in the
efficiency of operations, shortening development, in easing up the mandatory
chores like testing and implementation for the core team, and so on. Pay a few
dollars more to hire the right company that will save you time in managing the
offshore, rather than choose the lowest bidder and find yourself spending
increasing amounts of time in hand-holding or—even worse—cleaning up after the
vendor leaves a trail of bad delivery. An offshore outsourcing engagement is
like running the Marathon—the run is arduous and long, the benefits are returned
manifold times in the long term.
To help you get the best from your outsourcing engagement, here are our
customer-focused 10 Marathon Rules:
- Ensure that the outsourcer is a product engineering specialist
rather than an IT generalist:
product engineering entails a mindset wholly different from IT support. The
rules of the game change almost every day, and the services firm should bring a
talent pool and the gene pool that understands and adapts to these vagaries with
aplomb, and still deliver flawlessly. The interaction with the U.S. team will be
intense, and the team should be able to understand the bigger, customer-centric
vision of the problem and solution. For IT projects, customers are internal,
which results in limited specification vagaries. Products are conceived with a
certain customer use profile in mind, thus creating very high levels of changes
in specifications, priorities and even technologies. To cope up with these
changes and still deliver the output, the offshore team needs to have the right
experience. Flexibility is the key for successful product engineering.
- Treat the relationship as a partnership than as a client-vendor
relationship. Treat the outsourcing team members as your own employees:
when teams on the other side of the world understand your dreams and ambitions,
the energies are different, and the commitment to solve the same problems that
you intend to is of high importance. If you treat the partner as a vendor, the
team will just work to your orders, and not contribute valuable experience that
it may have gained from other engagements. In a typical product cycle, one never
knows when one needs to draw on that "superhuman" effort from some members of
the team. The chances of counting on that one extra stride are much more when
the offshore team members feel the involvement.
- Start small with maintenance-oriented activities before a
full-fledged development: as with any nascent process, time, training
and hands-on problem solving experience are the keys to accelerate the learning
curve. At the beginning of the engagement the offshore team may not be fully
aware of the product to run you a full functional testing plan. But if the
engagement begins with some maintenance and enhancement tasks, it gives the
partner firm time and scope to learn the product better, thereby able to engage
better with time.
- Choose your partner using a pilot project evaluation rather than
from an RFP process: as the saying goes, anybody can write a good RFP
response, but that does not mean that you will be able to choose the right
partner from the responses. Take a closer look and you will find that most
responses simply copy out your RFP just so they fill in the check boxes for your
selection. A pilot project will involve effort, but pays off in the long run
when you decide to choose a partner.
- Hire for the job: If the outsourced work does not involve
mainstream development, do not insist the partner provide the best and the
brightest of their talent pool. The top class talent may not like the
non-development work and will create attrition problems very soon. As the nature
of the engagement evolves, the right partner can always bring in the right
- Delegate the project management: At least the people
management should be in control of the outsourcer. They are on the ground there.
The engineering leadership in the U.S. may tend to insist on full control on the
project, which involves hiring, firing and day-today management—all of which
will become distasteful issues with time. In many successful engagements we have
seen than the involvement in these tasks is significantly higher at the
beginning of the engagement, but the US company's detailed involvement
successively tapers down as the US based management develops more and more
confidence in their offshore counterparts. It is important that this gradual
transfer of control should be planned at the outset.
- Focus on the team's ability to deliver rather than choosing
a group of technology savvy individuals, who do not operate as a team: the right
partner firm will know best about putting the right team for you—choosing
talent, experience, team effort and so on. Allow them the benefit of choice, and
you will have a team that is far more responsive to your needs.
- Ensure that the U.S. team begins following some engineering
processes. Most start-ups scratch up a requirement document on the
whiteboard, and the U.S. team, where the team members work in adjoining
cubicles, will work very easily off such a rough transcript. Getting
productivity out of a remote team working in a totally opposite time zone is
much more complex than "over the wall" management. If you do not have a process,
invite the partner firm to set up one for you. It will ease your managing the
engagement vastly in the course of time. Again, one should never advocate a full
blown SEI-CMM or ISO level processes for a startup. However, the discipline of
creating specification-architecturedesign documents and critically reviewing the
plans, documents and code created by the offshore team, both in a timely manner,
is minimally necessary to ensure higher success.
- Insist on weekly project meetings and monthly business review
meetings in addition to the ad-hoc daily communications. Weekly
meetings can bring milestones, schedules, issues, changes, and goals at a
tactical level in front of the project teams, while the monthly meetings can
focus on larger issues like company goals, directions, and plans. These help
glue the offshore and onsite teams in a more powerful manner—especially if you
can enable a video conference and meet up virtually.
- Incorporate a certain resource slack in the overall project budget.
The US startups are forced to work with almost no resource slack because of the
resource costs. However, in case of offshore teams, the chances of encountering
some unforeseen situations, either people-wise or infrastructure-wise, are much
higher, which could impact productivity and schedules. Since the offshore
resources typically cost substantially less than the US resources, keeping a
little resource slack is a very prudent way of doing things.
We hope this paper has given you a helpful list of rules in managing your next offshore project. Xoriant
Corporation brings nearly 2 decades of product engineering services for many clients across financial
products, networking and telecom, supply chain, and Internet-driven businesses. Using a strategic
onsite-offshore combination of product engineering delivery models, we help our clients in reducing
the time to market and lowering the costs of their product engineering cycles. We welcome you to
share your experiences in the offshore engagement, and add to the knowledge base we are building.
For more information, please contact email@example.com