Odds of Offloading an Offshore Vendor
It is not the case that customers are satisfied with the consequence of the overseas outsourcing initiative.
The causes just might be:
Not a sufficient decreasing in the cost of Application/product development or maintenance as a result of outsourcing : One of the main reasons for firms selecting the offshore outsourcing method is to lessen the total price, leveraging labor arbitrage. However, if the anticipation is based on individual to individual transition from onsite to offshore, then it may not be actually possible to fulfill the predictions, unless ample planning is done by the offshore service provider towards setting up a steady program management framework, both onsite and offshore, and processes for knowledge transition, knowledge management and automation using tools.
Poor quality of deliverables: The quality of deliverables may be insufficient due to specifications not being caught properly, or inaccurate design or simply poor quality of development and testing.
Non-adherence to SLAs: Despite the overall quality of code delivered, the purchasers will not be happy if the SLAs are not met i.e. the fixes are not delivered in time or the system up time requirements are not met etc.
Poor quality of communication and reporting: Well thought and thorough reporting and communication with the business on a consistent basis is essential to treat the gap and the cultural gap between the customer and the offshore vendor. Any exception in this aspect can result in serious client letdowns.
In fact, a close study of the results of customer satisfaction surveys suggests that in a large percentage of cases, the customers are not satisfied with their offshore outsourcing initiative or the services provided by the offshore vendor and would like to look for an alternative idea.
While many company may look at in-sourcing as an option, this in most cases may not be feasible due to:
IT budget may need to be significantly elevated and the administration may not be prepared to do so.
People may have moved to activities that they will consider as more exciting and may not be willing to move back to the old activities, and getting new people trained may result in loss of critical company knowledge.
The offshore vendor may have used technology and tools, important knowledge of which may not be available inside the customer’ organization.In such situation, the possibility, if one existed, that will be most attractive to the customers is a seamless migration of the entire application portfolio for some other vendor that can better meet the customer’s expectations.
The option that is now available to such clients is an aggregator platform with all the components built in to tackle the issues most commonly connected with lack of client satisfaction with offshore outsourcing:
Robust onsite Program Management: The experience of last 2 decades of offshore outsourcing shows that onsite program management needs to be provided by a specialist top end IT consulting firm, preferably based in the USA that has deep-rooted customer relationships with US enterprises and has confirmed track record of having managed difficult applications.
Quality offshore Program Management: It may also be valuable having a specialist Offshore Program management organization provide oversight on offshore delivery to ensure that quality and SLA expectations are met.
Best of breed delivery organizations: Buyers now expect the supply organizations to have in-depth knowledge of their business and also to organize the state-of-the-art. To meet such predictions, it may be necessary to have different vendors work on different applications depending on their area of super specialization.
