IT offshoring still works, if you're careful

Three CIOs say that the benefits of offshore outsourcing still resonate—if you learn from previous missteps and manage the risks

By CIO Executive Council, CIO |  IT Management, offshoring, outsourcing

Dean Haacker, CIO at large: The quality of offshore resources has improved dramatically over the last decade. Granted, traveling around the world to visit these teams can still be an adventure, but continued investments in better roads, airports, and hotels make it much easier.

One of the best reasons for engaging offshore resources is the insight they can provide about the needs of their local markets. If your company is trying to grow in the same places where you employ offshore teams, these firms can be a great source of market intelligence.

Offshore outsourcing is not an all-or-nothing proposition. As the saying goes, figure out what you do best and outsource the rest. For many companies, customer-facing roles like enterprise architecture, program management, and business analysis are not good candidates for offshore outsourcing.

That said, it would be a mistake to position your vendors as mere service providers; instead, look for ways to involve them as strategic business partners. I do not recommend relying on a single provider. Rather, consider a 70-30 split, where most of the work goes to a single provider, and a few other vendors provide niche skills and maintain competitive balance.


Originally published on CIO |  Click here to read the original story.
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