Offshoring with Blinders On


Chad Dickerson, CTO for InfoWorld, offers a delicious rundown on "The top 20 IT mistakes to avoid." Among them, this item:

3. Offshoring with blinders on

Any list of IT mistakes would be incomplete without a mention of offshoring. The experience of one vice president of operations provides an instructive cautionary tale. At his previous employer, the vice president opened a branch office in India for software development and encountered numerous surprises, many counter to conventional offshoring wisdom.

At the time, India had been experiencing an IT employment boom similar to that of Silicon Valley in the late 90s. According to the vice president, the workforce was not stable as a result. Transportation difficulties and the importance of time with family in Indian culture meant that employees generally worked eight-hour days — the concept of the Silicon Valley engineer who goes sleepless at release time was, well, foreign.

In the end, the cost of offshoring the branch office was only 20 percent less than the going rate in at home, and for cultural reasons, far more face time than initially expected was needed to ensure the commitment head office management demanded — which resulted in trips to India at least once per quarter. The vice president emphasized that offshoring can indeed work but said it's a mistake to assume that managing offshore IT is in any way equivalent to managing local IT or that cost savings will be as dramatic as you might expect.

Reading this article is like watching Meet the Parents. You'll cringe, for sure, guessing what's about to happen next.