| was surfing the Web the other day, an expressive | | | | "enhancement" and "frontier" relationships, as Gartner |
| headline caught my attention: "Outsourcing is stupid". I | | | | calls them, are typical for the maturity phase of IT |
| looked through the article by Alan Fisher, co-founder | | | | outsourcing. |
| and Chairman of Iron Speed, Inc., only to find out that | | | | Offshore Dedicated Team |
| "outsourcing is stupid when you can do the work | | | | At its maturity phase, outsourcing advances beyond |
| cheaper at home." Ironically, this anti-outsourcing truism | | | | the conventional project model: offshore vendors |
| sounds to me pretty much the same as the first rule | | | | provide their customers with exclusive full-time |
| of outsourcing (as I formulate it): outsourcing is the best | | | | dedicated resources on a long-term basis. An |
| solution when you don't possess enough in-house | | | | Offshore Dedicated Team (ODT) customized to the |
| expertise and/or budget for an IT development project. | | | | customer's requirements, practices, and even culture |
| It's great when you can afford to develop in-house | | | | operates as an extension of the in-house staff. The |
| everything you need, but what if have to retrain your | | | | ODT model sets the customer free from such |
| employees or hire new ones, pay for re-equipment, | | | | problems as incorporation, recruitment, office lease, |
| and deliver a project against a tight deadline? I'm afraid | | | | infrastructure set-up and maintenance. Using an ODT, |
| your choices are limited to giving up or resorting to the | | | | a business can reduce development costs, get access |
| outside expertise. No wonder the notorious drawbacks | | | | to specific skills, gain better control over the entire |
| of IT outsourcing and criticism from the general public | | | | development process, achieve easy scalability, and |
| don't seem to affect the scope of this omnipresent | | | | have the accumulated expertise transferred back |
| phenomenon. | | | | in-house. |
| New Opportunities - New Relationships | | | | Microsoft, Intel, Sun Microsystems, IBM, Dell, Motorola, |
| According to 2004 IT Outsourcing Study conducted by | | | | and other major IT corporations have been using |
| DiamondCluster International, 86% of Global 1000 IT | | | | offshore development centers for years. By |
| executives and providers of IT outsourcing services | | | | outsourcing work to their offshore centers, these |
| who participated in the study expect outsourcing to | | | | companies advance their technologies, obtain |
| further increase next year. Moreover, outsourcing is | | | | substantial cost savings, and at the same time allow |
| more than simply cost savings now. "While reducing | | | | their in-house teams to concentrate on their core |
| costs is still the number one reason fueling the | | | | tasks. |
| outsourcing trend, another key factor is that | | | | Nowadays, an increasing number of mid-size |
| companies are looking to free up internal resources to | | | | businesses outsource large-scale and/or continuous |
| focus on more critical initiatives," says Tom Weakland, | | | | projects to offshore dedicated development centers |
| who leads the outsourcing advisory services practice | | | | and teams. Such projects involve custom software |
| at DiamondCluster International. Globalization creates | | | | development and/or maintenance, R&D, testing, |
| new opportunities for those businesses that know how | | | | QA. The time of operation of an ODT is normally six |
| to establish sophisticated and interdependent | | | | months or more, otherwise the invested time and |
| relationships with their offshore vendors. These | | | | effort don't pay off. |