OUT SOURCING
 
Why should enterprises outsource?
Why India ?
How to find partner ?
Outsourcing Issues
Reasons for Outsourcing failure
 
Why should enterprises outsource?
1 Cost-reduction.

» Outsourcing software has proven to be economical by saving about 30 to 40 percent of IT budgets.
» Outsourcing has the ability to save resources allowing online enterprises, less than 10 percent of revenue.
» It also proves to be quite economical for new companies who do not have sufficient funds to invest in large-scale projects.
» It dramatically reduces capital requirements and total cost of care operation.
2 Gaining new knowledge effectively

» Technology is changing with every passing day and it is very difficult to train the staff so fast. An obsolete technology can wipe an organization out of the market. Outsourcing from a company with required know how of technology helps reduce time and cost for training.
» The same being the case for projects, which require expert service and knowledge, software development outsourcing proves to be a reliable supporter.

3 Increased productivity by focusing on core expertise

» Rather than falling into the cobwebs of recruiting and waiting for staff; software development outsourcing allows companies to focus on their core expertise and improve productivity.
» Through software development outsourcing, the workload of the staff can be significantly reduced.

Why India ?
The world has already discovered the strengths of India for software outsourcing. Various factors that contribute to making India the ultimate destination for IT outsourcing are:

1. Trained manpower
Being the world's second highly populated country, human resources are a boon by itself. India is proud of the abundance and easy availability of its highly qualified and technically skilled English speaking computer professionals; who are key to success in the field of IT outsourcing to India.

2. Cost difference
Significant cost saving can be achieved by IT outsourcing to India, owing to the wide gap between the personal costs in India and that of the developed countries. Offshore outsourcing to India offers considerable economical benefits for those who are prepared to exploit the advantages of outsourcing.

3. Quality of work
The Indian companies involved in IT outsourcing in India provide high quality work, meeting international standards and complying with the ISO & SEI-CMM standards. Three out of every four SEI-CMM 5 companies worldwide is located in India. Thus India promises quality - IT outsourcing in India as it has the potential to furnish these services perfectly.

4. Reliable communication facilities
Excellent telecom, ISP, and cellular networks are available in all cities & towns in the country. India prides in the reliable satellite and submarine communication links that facilitate good band connectivity with the rest of the world. Thus companies engaged in IT outsourcing to India, can be in touch with the vendors without any connection hurdles. This plays a significant role in determining the success of offshore IT outsourcing to India.

5 Favorable government policies
India has a pro - IT government policies which have been helpful in improving the infrastructure as well as communication. The government proves to be a great support for software firms by further providing all the basic facilities required for an outsourcing company to flourish thus playing a major role in contributing to the success and well-being of IT outsourcing to India.
 
How to find partner?
Our experience and knowledge working with off shore companies over the years have allowed us to give some inputs for companies who are looking for outsourcing partners.

While planning to join hands, one should look for following in the software development company:

» Breadth of skills
» Communication skills and support system
» Experience
» Security provisions
» Team
» Management focus
» Quality of previous projects handled
» Knowledge of the company about market

Software Services Outsourcing Issues

Our experience also

1. Starting the contract
» Contain a well-defined transition period in terms of the contract.
» Decide the commencement date.
» Decide on deliverables
» Decide on the delivery date
» Define the testing frame
» Make sure that the company has well understood your requirements
» Ask for the resume of the programmers

2. Ownership
Ownership of information and data should be made clear.
In cases where the outsourcer takes the services with the help of the purchasers equipment; agreements concerning purchase and returning of these inventories during the contract termination must be fixed.
Along with this, if service is hired from an external provider; the provider, outsourcer and the purchaser should agree on it.

4. SLA and Management
SLA's (service level agreements) should be clear and comprehensive. It should define
the minimum level of service; is the basis to measure the outsourcer's performance, areas of services like system availability, response time and quality standards, analysis of performance data, like system response and job turn around times.
both the parties must be aware about the flexibility of SLA's and review period in the SLA to cover changing purchaser requirements and new technology.

5. System requirement specification
The defining of the system as well as service specifications must be done well when it comes to software services outsourcing.

7. Warranties
The warranty must contain service quality and compliance with specification.
Those seeking opportunities offshore ought to the aware of the many aspects of software services outsourcing.
 
Offshore Outsourcing Services - Failures not allowed

Though the failure rate for projects in India is between 5% to 10%, our failure rate has been zero till date. We have delivered all the projects successfully till date without any failure.

We have been very clear and transparent with the companies sending us the project and thus are in a position to guide you about the reasons as to how to avoid the failures.

Outsourcing failure is expensive for both the parties. Therefore, the reasons behind failures are important.

The root cause is for failure is generally the missing link between the customer's expectations and the perceived results. This is due to the lack of understanding between the service provider and the customer.

Steps to avoid these defaults
» Consider taking offshore outsourcing services as a strategic investment.
» Understand and align the interests of service providers and customers.
» Set a standard, objective against which the management process can be measured gradually.
» Develop a system for dealing with problems and negotiating changes & maintain it as a part of the ongoing management of relationships.
» Include people who are skilled at handling relationships, and those who have personal, professional & economic motives in doing so.