I recently read somewhere (I forget exactly where) about the 3 pillars of offshore outsourcing. BTW – If the author of the original piece were to read this, please add a comment and I shall add the credits to this post.
The 3 C’s of Outsourcing – Coordination, Communication and Control.
These are the 3 key factors that pretty much govern everything there is to know about Offshore Outsourcing. Right from the question of “Should I go offshore?” to “How to manage an offshore outsourcing engagement?”, I believe that these 3 factors answer almost all the questions.
For the sake of this discussion, let us restrict ourselves to Application Development Outsourcing. Strategically speaking, the decision of ’should this be offshored’ (?) can be answered by honestly assessing and guaging the depth/expertise needed in these 3 areas –
1. Coordination – Is this application development initiative coordination intensive? e.g. – Early stage product development projects usually are. Coordination intensive engagements need highly mature processes and tools (apart from strong human interaction). Offshore outsourcing can be considered if organizations are equipped with tools to handle coordination intensive engagements.
2. Communication – Culturally, some firms may believe in and rely on planned communication rather than ad-hoc communication. Typically, in a start-up environment where processes are still being built, project communication is more ad-hoc than planned. In an offshore engagement, how well is your organization, your project and your service provider geared towards handling engagement specific communication? Again, processes and tools are important here. For example, if your team believes in ad-hoc communication and if your service provider is culturally a ‘planned communication house’, then you need to rethink on how to handle your project communication needs.
3. Control – How much control do you need and how much of it are you willing to relinquish? In an engagement where the application lifecycle has reached a stage of maturity (only bug-fixing and incremental application enhancements are involved), control can be established with tools.
Irrespective of where you stand in your outsourcing intiative and whatever your perspective on outsourcing is (strategic, tactical or operational), the 3 C’s will help in creating and correcting your path in managing an outsourcing engagement successfully.
As usual – Comments welcome.
