IT Offshore Outsourcing Jeremie Pechmann Katie Ralls Tim Wahlquist Wensheng Qiu

Off-Shore Outsourcing Project Topics: Offshore Background India China Boeing

What is Offshore IT Outsourcing? “The exporting of IT-related work from the United States and other developed countries to areas of the world where there is both political stability and lower labor costs or tax savings.” Source: Whatis.com

www.seattlepi.nwsource.com/business/164018

Why Outsource? www.searchcio.techtarget.com/qna

Top 5 Outsourcing Objectives www.offshoreitoutsourcing.com/Documents/it_outsourcing_vendors_evaluation

Trends services being outsourced www.rosourcing.com/trends

www.mckinseyquarterly.com/article_abstract.aspx?ar=1453&L2=7

http://commonziffdavisinternet.com/download/0/2216

Researchers Say… Meta Group Offshore outsourcing will grow from $7 billion currently to more than $10 billion by 2005. Gartner Inc. According to Gartner research, 5% of IT jobs have gone overseas, and 25% will be "offshored" by 2010. Forrester Research Respondents in a survey of 145 IT decision-makers at North American companies rated offshore providers better than U.S. firms 67% of the time in terms of quality and timeliness.

How to Outsource Create a multi-year plan, with quarterly reviews that includes creating, incubating and growing your development center Choose the location after spending time to evaluate and study the pros and cons Understand how the local culture thinks and behaves Take a long term view (5 to 8 years) www.cio.com/qna

Gartner Picks Best Offshore Destinations India China Malaysia Czech Republic Singapore Philippines Brazil Russia Other than India and China, what other countries are actively participating in the offshore outsourcing market? And what obstacles do they need to overcome to compete with India and China? Cox: A range of countries are involved in offshore outsourcing. The big ones on our [Gartner] radar are India, China, Israel, South Africa, Northern Ireland, Southern Ireland, Czech Republic, Poland, Hungary and Russia. We evaluate each of these countries based on language compatibility, government support, infrastructure, educational system, cost, labor, political stability, cultural compatibility and security. I'll give you a quick break down of the main issues each of these countries face in the offshore market. China falls down a little on the list due to infrastructure, language and cultural compatibility. But China is addressing some of these obstacles, such as language barriers. A little statistic from the Chinese government shows that there are more people learning English in China than there are people in America. In Israel, political stability is an issue. South Africa is doing pretty well. However, they don't have solid government backing. Northern Ireland has been around a while in the offshore outsourcing world. And Southern Ireland is pretty much the same. In the Czech Republic, there are language issues and no strong government support. Poland has language issues. Hungary has language and infrastructure issues. Russia is definitely up and coming. Russia has even developed an equivalent to India's NASSCOM (a nonprofit group formed to support and promote India's growing IT segment.) However, Russia does have some issues, such as language, infrastructure and security. Government support is also an issue in Russia. However, out of all the countries, government support in Russia is very close. Russia will definitely be a force to reckon with. www.searchcio.techtarget.com/qna

OffshoreITOutsourcing.com/vendor_selection 1) Identifying areas that you wish to outsource 2) Researching list of vendors you wish to shortlist 3) Do a thorough analysis of each of the vendors for their expertise, financial stability, history in executing outsourced projects 4) Internal or external consultants 5) Getting in touch with the short listed companies for a preliminary interaction Assess each vendor against common criteria like industry know-how, technical skill set, cultural flexibility, quality standards, pricing model, procedures After narrowing down your choice to a few selected vendors, begin a pilot project with the offshore vendors. This project, though smaller in size and non mission-critical, will help to further analyze the short listed offshore vendors more critically. Project's outcome will help decide which offshore vendor's mind-set best suits your project needs. Before signing the final contract, it's advisable to make a personal visit to the offshore site. This would help in validating the claims made by offshore vendor. Interaction with offshore team gives an idea about their attitude towards your company and their flexibility to work with a team located far away. Finalize the contract with SLA (Service Level Agreement). It should clearly list out the minimum level of service to be provided by the offshore vendor. Performance Measurement techniques should be well defined within this. The steps, in case of failure to meet the set standards, should also be mentioned and agreed upon by both parties. continuous monitoring and performance measurement as per mutually agreed procedures. This helps to identify and work out any discrepancies and issues, as and when they arise. Offshore team must strictly adhere to the reporting system decided upon. OffshoreITOutsourcing.com/vendor_selection

Offshore Venue Comparison www.wipro.com/aboutus/odc/odcresources.htm

Offshore Venue Comparison www.idc.com/getdoc.jsp;jsessionid=3SGPQX

Today’s Situation Many Companies are jumping into the Outsourcing bandwagon with a ‘me too’ attitude. Cost reduction is the main driving force. Lack of understanding of local issues and culture will cause these operations to fail.