Offshoring is here to stay. According to a recent Deloitte survey, 70% of respondents who planned to outsource IT work planned to do it offshore.* And for good reason. When you weigh the time and cost savings of offshoring with your growing to-do list and shrinking internal bandwidth, it can often be a no-brainer. But not all projects are created equal. To reap the benefits of offshoring while avoiding its pitfalls, you have to know how to align with your offshore partner to get work completed. Not all types of work are suited for offshore.
Here are three types of work you should never offshore:
1. Work involving your “secret sauce”
Be careful with your secret sauce – it’s a risky thing to offshore. But first, make sure you understand what your secret sauce really is. Your secret sauce is something that’s core to your business – your competitive differentiator – and so you want to keep this knowledge inside your business. You also want to protect against the risk of diluting a competitive differentiator.
This sounds like an easy concept at first, but many companies miss the point. For example, an independent software vendor may assume that writing code is their secret sauce. However, just because you’re an ISV doesn’t mean that writing code is core to your business. What’s core to your business are the things that differentiate you competitively. Those are the things you need to keep in-house.
2. Short, first-time projects with a new offshore partner
Planning, implementing, and perfecting an offshore partnership is not something that happens overnight. In fact, it can take few months for your offshore partner to become efficient at delivering your work. That’s why first-time projects with short timetables are better kept onshore. To make offshoring really work, you have to approach it like any other major new initiative – thoughtfully, strategically, and with the long view in mind. It’s not just about quick wins. It’s about creating real, long-term value. The longer you work with your offshore partner the shorter the initiatives may become.
3. User experience projects
To do UX right, you have to do it onshore. Why? The cultural differences and potential communication barriers introduce too much risk for something that’s all about nuance, subjectivity, and intimate knowledge of the user. UX designers need to be able to understand the user firsthand before they can create a meaningful experience. So, to do user experience right, keep it as close to the user as possible.
So what can you offshore?
Everything else should be up for consideration when it comes to outsourcing work offshore. The best offshore initiatives are projects that can be well defined, that may involve a lot of repetition, or that may require your team sizes to scale up or down. These kinds of projects often consume significant time and resources for an internal IT department unnecessarily. Send them offshore, and you can free your internal teams to focus projects involving your secret sauce, shorter first-time projects, and UX projects.
*Deloitte’s 2012 Global Outsourcing and Insourcing Survey
Please read more about Offshore partnering at: Ask the exec how and when to offshore