Friday, September 30, 2011

When to Offshore and When to Stay Home

It's a pretty well-known fact that utilizing offshore development resources can be a great way to achieve cost savings and scale when it comes to technology development and support. There are also well-known risks in getting technical work done halfway around the world, including communication and project execution challenges, technology differences, language, culture, and intellectual property risks. Some of these risks can be well-mitigated by using a hybrid model, keeping some client-facing work local while the offshore execution team works on specified tasks. Yet sometimes, even this hybrid model won't work.

Challenges with offshore execution are often a result of the type of project that is being outsourced – not necessarily an issue with the concept of "offshore" itself. V1 development efforts, for example, are not typically good candidates for offshore development. With a brand new product, it is usually best to keep the initial v1 design, prototyping, and client interactivity in a local conference room with an ample stockade of caffeine and easy access to real-life users. On the other hand, the following projects can make for great offshore development material:

  • Projects where onshore resources have been used for the initial version, and new versions have specifically established scope and schedule.
  • Projects where user scenarios are well-understood, agreed upon, and prioritized.
  • Projects where solid and trusted customer relationships are in place, enabling ease of communication and quick feedback when needed.
  • Projects where key performance metrics (KPIs), are established for both the product and the offshore team, allowing for measurably improved delivery over time.

If these elements are in place, moving your technology development or support effort thousands of miles away is well-staged for success and can save you a lot of dough.

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