The role of people in the success of offshoring

In my previous article, I wrote about personal values in the offshoring context. In this article I want to discuss the role of people in making offshoring work. Some questions related to this subject:

  • Who are the people in my offshore team?
  • How do I create support for offshoring among my people?
  • Does the culture of my company match with the supplier’s culture?

Based on my experience with offshoring success and failure, I would say that companies that place an accent on the people, increase their chances. Let’s take a look at the three above questions.

Who are the people in my offshore team?

This is a crucial element in offshoring. Eventually, no matter how good you think your supplier is: the work is done by people and the supplier is as good as the people they put on your team. Even if your team is very big, you want to make sure that you have an influence on the selection procedure. Your people will have to cooperate with your offshore team and they should be happy to work together and to cooperate to achieve your goals.

I believe that any organization wishing to make offshoring work, should engage in the recruitment of the team members, by aligning interviews, performing tests and making sure the people ‘fit’ with your company.

How do I create support for offshoring among my people?

This question is hard to answer because every organization differs. In general, it is wise to engage the key players in the decision to offshore, from an early stage. The project manager who has to manage your offshore team should be among the supporters of the initiative. So is your management team.

The best starting point is setting out your vision and making sure everybody sees the same picture. Then define goals that you want to achieve within 1 year and goals that you want to achieve within 5/10 years. Everybody should see where you´re going.

Another important topic to address is the risk for people that they will lose their job. Many people believe that the logic outcome of outsourcing is that they will be fired. But do you really envision that? Do you create an offshore team to have extra capacity or do you want to cut down your costs and let some local people go? Do you move your current people to another job, will they have the same growth perspective?

Last but not least: let your onsite team physically meet your offshore team. You will see that as soon as they have drunk a beer together, they will start helping each other, producing better results and bringing you closer to your goals.

Does the culture of my company match with the supplier’s culture?

This last question should be asked early on in the supplier selection process. It is the basis for your cooperation, because if the cultures don’t match, you won’t have the right people on your offshore team and there will be no support from either side. Focus on the feeling you get when meeting your supplier, ask about their values, ask about the way they pay their offshore employees. Maybe you even want to interview a few people from their offshore centers to get a feeling of the company’s way of working.

This entry was posted in Offshoring, Outsourcing by Hugo Messer. Bookmark the permalink.

About Hugo Messer

Hugo Messer is the CEO of Bridge Global IT Staffing and is a Global IT Staffing Expert.Hugo Messer has been building and managing teams around the world for over 7 years. His passion is to enable people that are spread across cultures, geography and time zones to cooperate. Whether it’s offshoring or nearshoring, he knows what it takes to make a global cooperation work.Read his articles here.To know more about Hugo and his global team building programs visit www.hugomesser.com

5 thoughts on “The role of people in the success of offshoring

  1. Pingback: How do you prepare for offshoring? | Bridge-Blog

  2. Dear Erik, Viktor and Hans,

    thank you very much for your feedback, I believe all your comments add to the content of my article. It’s always nice to see that people agree and have the same vision!

    hugo

  3. Hugo,

    I too, fully agree with you. The people make the difference. Companies who engage with off/nearshore suppliers should indeed never approach this solely as a cost saving tool. It can be an very nice side effect and in the long run it will pay off literally. However, the main goal is to accomodate a need for capacity/growth. Companies should ask themselves, how would we satisfy a need for capacity here in the home country. You would be very careful who you select to be a member of your team. Not only should this new person be very capable and knowledgeable on the things you want him/her to be doing, but also you want to be sure this person will have a good soft skill set which matches with the current members of the team. Why would it be any different when you off/nearshore? Just because there is a fysical difference between the teams? This point alone makes it even more crucial you have people in your foreign team who understand your goals, values and culture. Talking of culture: when engaging with an off/nearshore team there will always be cultural differences, no matter how you slice it. That will only be a problem if you do not recognize and/or accept it. Embrace these differences, make sure you know how to deal with it, make sure your home team knows how to deal with it. It will make everyones work much more interesting (and I do not mean this in a cynical way…. ;-) ) People make the difference, not only close by but also far away.

  4. To be able to get as much value from the outsourced development/operations as possible, the client company should tend to engage with its IT services supplier so as to have as much control of its project teams as possible, including own PM’s relocation to the supplier’s office, 100% involvement / decision making in the hiring process and ability to manage costs (as incurred actual costs of outsourcing unfortunately often exceed the contracted ones, as the practice shows). The supplier should be regarded as a space and resource provider and administrative issues solver rather than the “project conductor”. Companies who think they’ll outsource their project to a 3d party (either offshore or nearshore) and then “wash the hands off” and wait for the vendor to do the whole job and then skim the cream are doomed to fail and stay dissatisfied with their decision to outsource. But those who’re ready to take extra efforts, hire a competent consultant and/or manager to lead the outsourcing process and monitor their project on a 24/7 basis will be able to save significantly from their outsourced development due to reduced/eliminated delivery delays, vendor’s staff turnover and hidden agenda. The client should be able to control and manage every single penny spent on the project and create, enhance and grow its own outsourced team and outsourced culture. I believe this is going to be the philosophy of outsourcing of the future. In short, people do matter on the outsourced team, but it is the outsourced services buyer who should manage them rather than the provider.

  5. Hugo, I fully agree with you and would take the impotance of people even a step further. I believe that people are in the centre of offshoring. Treating offshoring as a spreadsheet activity, or just an agreement between two companies is guarenteed to fail.
    It is the people that make the difference. I therefore fully believe in the approach that the key people of both parties (supplier and client) should be selected to be able to work together. and key people include management roles but not only management roles. Although people are from different backgrounds, different companies, different cultures it is stil “working apart together” that makes the difference.

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