Offshore Development in a Global Company

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

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 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

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

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

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

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!

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

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

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)

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

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

Q&A Q&A Aviram Eisenberg [email_address] +972 52 6005161 www.igniteoutsourcing.com

Q&A

Aviram Eisenberg

[email_address]

+972 52 6005161

www.igniteoutsourcing.com