Outsourcing IT development can be a powerful business tool for companies that learn its best applications. Think of it this way: opening a can of soup with an electric drill would be a bad experience. But that doesn’t mean that electric drill is useless — we just need to know what jobs that particular tool is best suited for.
Businesses are learning the same lesson about outsourcing. One major manufacturer decided to outsource all Internet development efforts to India. They terminated all onsite IT development consultants and pushed development offshore. Their experience was disastrous. Within a year, they’d terminated their CIO, yanked all development back into the U.S., rehired everyone and licked their wounds. Furthermore, they now view any vendor’s mention of offshore development with contempt.
Many companies have learned the same lesson the hard way. Organizations can’t just throw their IT development projects across the sea and get back a flawless package, quickly, at low cost, with a big red bow on top. That’s not how it works. In fact, learning how to leverage offshore/nearshore development for their benefit has been quite an education for many companies.
So how does it work? Many organizations have seen success by dividing large projects into multiple parts: a part that stays within the U.S., a part for nearshore development and a part for offshore development. The challenge is knowing who should get each part.
Below are some of the benefits of, and best cases for, offshore and nearshore development. But, first, it’s important to note that a company can’t outsource internal problems. Outsourcing development only works if internal development processes are sound.
Here are some of the best cases for considering offshore development:
Nearshore development has been quickly gaining momentum over the last few years. Some of the benefits of nearshoring include:
Proceed with Caution
In considering offshore or nearshore development, proceed with caution. Keep these recommendations in mind:
One bad experience can cause a company to “throw the baby out with the bath water,” swearing never again to outsource development. This is a mistake the competitors won’t make. The savvy company will learn how, when and where to outsource IT development to capitalize on savings in cost and time.
Tony Streeter is the CMO/SVP of San Antonio-based Y&L Consulting, Inc. Y&L Consulting is a comprehensive IT services & solutions company specializing in Application Development, Information Management/BI and IT Help Desk Services.