Mini-Rant: Offshore Outsourcing to Cut Costs is Short-Sighted

By Jen Darr, blog.pchelps.com |  IT Management/Strategy, CIO, offshore 2 comments

A recent article in CIO.com about the real costs of offshore outsourcing got me thinking. It's surprising that so many CIOs continue to enter into contracts with offshore outsourcers, despite evidence that shows the cost savings are often nonexistent.

I work for a Philadelphia-based software support company, and one of the most common questions customers ask our consultants is "Where are you located?" When our techs tell them we're in the Philly suburbs, the consistent reaction is surprise, then delight -- perhaps because the callers sense that maybe, just maybe, their issue will be solved today, and not after two hours of holding, spelling their name, rebooting, getting transferred, explaining their issue, holding again, explaining their issue again, and so on.

Choosing an offshore outsourcing partner for cost savings is short-sighted. It's like opting to buy a Hummer instead of a Prius because the dealer slashed the sticker price; sure, it's cheaper up front, but the fuel, maintenance and environmental costs are much higher with a Hummer over the life of the contract.

What has your experience been with offshore outsourcing? Tell me in an e-mail.

MORE INFO IN: 5 Lessons to Learn Before Outsourcing | Contact PC Helps Support

2 comments

    Anonymous 2 years ago
    Because I'm a web developer and I've just had a really lousy freaking day. I would say we've got about 20 times the guys we need on the back end. This, no doubt, started with somebody in management hiring 'more than enough' guys to replace the real back end devs we should have hired in the first place and their numbers simply grew larger and larger as it became clear that the work just wasn't getting done right.While some are reasonably competent devs, and even likable people, the general skill levels are all over the place and the communication sucks almost universally. Ever tried to teleconference with heavy Hindi accents over a fuzzy phone line? It's not fun. And for some reason they don't want to write, just talk. This is partially because they hate to have to commit to anything in writing.Second, I'm pretty sure their home company treats them like dirt because they don't ever want to tell us there's a problem. Even when it's clearly our fault! And now for some reason, we can't get them to do anything on the back end now. They want to build entire sections of pages with JavaScript on the front end. We're clearing form entries with Javascript. And our databases are now failing regularly.My advice? Offshore when it makes something possible that otherwise wasn't. QA for instance. Nice to have if they don't suck at it and in a lot of smaller organizations you'd never be able to afford it. But in our case, it wasn't worth it. None of it from what I can tell has been worth it. And we're stuck with it because nobody wants to admits there's a problem when it's so much easier to just point at how much more they'd be paying for an equal number of real back end devs.But be REAL careful if you're even thinking of giving the go-ahead on off-shoring at a large organization because once you commit to it, it's a long and hard dig out of that hole to get through all the BS that will ultimately get used to justify it.
    ExecutiveBrief
    ExecutiveBrief 2 years ago
    Indeed, there is a general belief that outsourcing is supposed to save you money. This is especially true when it comes to outsourcing mission critical work like software development, typically done offshore, with companies who enjoy very low labor rates. Unfortunately, the saying “Outsourcing will save you money,” is a lot like the old adage of, “Practice makes perfect.” They’re both half-truths. The real truth is: “Only perfect practice makes perfect.” If you repeat the same mistakes again and again, practicing something wrong for any amount of time won’t make it right. Similarly, only outsourcing with the right partner will save you money in the long run. Pick the wrong one and you’ll pay dearly for that decision.www.executivebrief.com/article/the-incredibly-high-cost-of-saving-money-on-outsourcing.

      Add a comment

      Post a comment using one of these accounts
      Or join now
      At least 6 characters

      Note: Comment will appear soon after you have activated your account.
      Obscene/spam comments will be removed and accounts suspended.
      The information you submit is subject to our Privacy Policy and Terms of Service.

      ITworld LIVE

      IT Management/StrategyWhite Papers & Webcasts

      White Paper

      Business Value of Blade

      The nature of the blade platform makes system management, monitoring and provisioning easy and efficient. Access this resource to learn how blade migration will save your data center time and money while increasing performance.

      White Paper

      Accelerate time to application value

      For your IT organization to keep pace with the business, you need a new, faster approach to infrastructure deployment-an approach that increases agility and accelerates time to application value. That's HP Converged Systems. Built on Converged Infrastructure, these systems deliver the industry's first portfolio of pre-integrated, tested, and optimized infrastructure solutions for applications running in virtual, cloud, dedicated, or hybrid environments.

      White Paper

      Converged Infrastructure for Dummies

      As you know, everything is mobile, connected, interactive, and immediate. This is exactly why organizations need a highly agile IT infrastructure in order to keep pace with extreme fluctuations in business demand. This book will help you understand why infrastructure convergence has been widely accepted as the optimal approach for simplifying and accelerating your IT to deliver services at the speed of business while also shifting significantly more IT resources from operations to innovation.

      White Paper

      HP NonStop SQL Fundamentals whitepaper

      This whitepaper offers a detailed look into the fundamentals of HP NonStop SQL solutions. See how this system delivers unprecedented levels of application availability with fail-safe data integrity and meets the needs of enterprises with large-scale business critical applications.

      White Paper

      Top Solutions and Tools to Prevent Devastating Malware

      Custom malware frequently goes undetected. According to Forrester Research, the best way to reduce risk of breach is to deploy file integrity monitoring (FIM) tools that provide immediate alerts. This white paper has been brought to you by NetIQ, the leader in solving complex IT challenges.

      See more White Papers | Webcasts

      Ask a question

      Ask a Question