Offshore Outsourcing

Choosing your IT partner is the business equivalent of choosing a spouse- you're hoping for a happy, long-standing relationship or perhaps like choosing a builder for an extension or renovation- an offering that can work with your style, needs and budget and most importantly, a contact that you have a rapport with. These kinds of relations assist in communications which are key to any IT project- be it enterprise scale or start-up. Considering that communication will be the single most important factor in success, it goes to show that choosing an off-shore provider, sourced through a trade directory, with project managers that you will never meet face-to-face, can be likened to choosing a mail-order bride. Risky at best.

There are key aspects that should be explored and considered when it comes to choosing the right company to supply you with IT services. It should be a 'partnership', not a 'contract', and you should aim for a long-standing relationship that will provide your company with what you need, when you need it, within the time and budget constraints of your organisation. You might not always know exactly what those needs will be at the outset... often this becomes apparent and is demonstrated only further down the road.

If you are considering offshore IT resources, consider why people are uncomfortable with the idea that their personal information is stored in another country where there are different cultural attitudes to personal information and different laws.  A lot of countries do not provide secure property laws which make it easy for economic espionage to occur and those with the most sought labour costs are the ones that are still busy developing their political systems and labour laws.

Offshore outsourcing also relies heavily on documentation needed to comply with certain policies and procedures and to increase the chance of IT projects meeting objectives. This could lead to a lengthy waiting period before you can actually start working and producing what you need to, not to mention the expertise and resource required to complete technical software requirements and specifications. Local software experts tend to specialise in specific industries reducing the need for such extensive specifications and usually offering added value in many areas due to specific, localised industry knowledge.

Another aspect to consider is time zones. Even though the offshore company you are busy forging a relationship with might not be a whole day ahead of you, even a few hours can make a difference. Say you request a task for completion at 8am in the morning and the country of your outsourcing is 2 hours behind, it will be 10am before they receive the request. They might only complete the task by the end of their day, which is already 2 hours after you might have left, making it a whole day of waiting on a simple task. Had you asked a local company, they could have received and completed the task within the day. Doesn't sound so bad waiting 1 extra night on 1 task, but multiply this by the number of tasks and queries on a complex IT project that runs for 6-8 months and what you end up with is basically just a waiting game.

It is true that cost reduction plays an important part in the decision to choose offshore outsourcing as an option. Most offshore companies usually offer competitive labour rates that can be very appealing, but most businesses that choose this option rarely ever look at the fine print or the hidden costs behind it. These costs are usually not calculated into the overall budget and should be analysed carefully. There are things like costs for long distance communication, training, and travelling. Any long distance relationship requires a large amount of effort, money, and time and it can become taxing on your everyday work situation.

More often than not these relationships are not always maintained. It's breakdown is so fast and severe that it can cause major damage to your business. Common causes for these breakdowns include an insufficient number of individuals involved, poorly designed policies, gaps or uncertainties in the contracts, and poor execution of roles between the two parties.

So the vital question that still remains is the following: is offshore outsourcing something to consider when delivering an IT solution? Evidence shows that it is not something that you should delve into blindly due to the factors that can hinder it. Onshore business will save you costs, time, and money, and the lines of communication will be open and easily accessible for all.

In short, it is acceptable to outsource certain elements of your IT function, and in certain situations can make sense, but it is better to use local companies in order to save in the long run and ensure seamless integration. Even if your local IT service provider does manage to successfully outsource some of the development to offshore resources, let them do the project managing and technical integration. The cost savings will still be passed on to you as the client. 

George Toursoulopoulos is a technology specialist and CEO of Synetec, one of the UK’s leading providers of bespoke software solutions.