Key Success Factors for Carrying Out Offshore Outsourcing
IT departments of various software companies across the world today are investing in offshore outsourcing. The main reason why offshore software development outsourcing gained traction as a popular modern business strategy is because of its ability to yield high quality software at comparatively low cost and the availability of highly qualified professionals (if you know how to select your outsourcing vendor wisely). However, the success of any offshore project is equally important to both the outsourcer (customer) and the outsourcing partner (vendor). We see many offshore business models that fail because they rely way too much on the cost-saving factor in their selection process of software development outsourcing vendors. There are other important, key factors that also should be considered while choosing your offshore IT solutions and technology vendor.
Some of the best offshore IT vendors in India and elsewhere take up business outsourcing projects that successfully deliver high-quality services to overseas clients at rock-bottom fees, a team of brilliant English-speaking resources and top-of-the-batch IT professionals in the world. But as a customer, if you don’t know how to carefully select your offshore software development/testing partner, then your project can be at a high risk. If you are a software company and seriously considering to engage an offshore development/testing/designer team, then these vital tips can help you make the critical decision on which offshore service provider company to partner with:
Cross-Cultural Compatibility Study
Most often than not, the cultural differences (and similarities) of your outsourcing vendor determines the overall productivity (and success) of your entire project. The country and culture is important to consider while choosing your offshore vendor because that will tell you about the socioeconomic and political condition of the region. Also, if you notice that outsourcing is popular in that country and many overseas clients are selecting offshore teams from that nation, it will often mean that the quality of service from that country can be trusted.
Cost of Contract
It goes without saying that, the most obvious benefit that an overseas company can gain from outsourcing their IT and software projects is ‘cost’. While the availability of skill sets abroad are wonderful, however, the biggest reason for any outsourcing customer to go overseas is cost. We have seen so many examples where companies were able to save as much as over 60% by outsourcing. But if you are not careful, some outsource vendors can take you for a ride and by the time your project is completed you would have spent lot more than what you had anticipated. To avoid this, discuss your projects budget upfront and make sure that both parties understand and agree to the decided budget and stick to it till project completion. Once the outsourcing project has been finalized, a smooth two-way business transaction should be decided that will bring profits to both partied involved.
Big Company ≠ Great Outsourcing Service
Another common mistake that customers often make while choosing the best outsourcing vendor is falling for the assumption that selecting a big company will automatically guarantee a successful partnership. In fact, going for a big company can actually backfire. Most big companies often take up lot of outsourcing work and as a result may not assign their best resources for any one project. They usually assign the junior level resources to average projects and rotate their senior and more experienced professionals from project to project.
On the other hand, in smaller companies the number of projects are far less in number and if you insist them while discussing your contract you can actually get their best resources allocated for your project. This makes choosing a smaller company a better choice than going for the bigger ones.
Managing Offshore Team
The obvious drawback of any offshore contract is the management of your offshore resources. To overcome this, select the best way to monitor work. Make sure you are communicated periodically about your project’s progress (or the lack of it). Demand to have at least a weekly 1:1 meeting with the offshore team manager so you can always stay at top of things.
In addition, a correspondence clause should be included in the project’s contract, mandating the offshore outsourcing vendor to regularly communicate with the outsourcer regarding any issues related to the project.
Verify Their Past Experience, Expertise and Testimonials
And last but not the least, the projects undertaken and delivers in the past speaks a volume about their experience and expertise. It also shows about the domain they are exposed to and the technology expertise that they might have picked up along the way and may help your own project.
Ideally good offshore software development companies should be able to undertake custom software development for most type of business. Hence you should expect the least of learning curve. But for greater chances of your project’s success, go for the outsourcing vendors who appear to have past knowledge of your industry or a closely related industry.
However, it may not be possible for an outsourcing customer to verify all the above steps when evaluating an offshore software services vendor but even a few of these steps will ascertain that you will be able to make an educated decision, when it comes to selecting a skilled offshore vendor.