Over the years, offshoring has gained much popularity in the business world as a means of obtaining services from external parties or companies based in another country. However, many companies who jump on the bandwagon with lot of expectations get quickly frustrated.

This is mainly because those companies do not spend enough time on due diligence before starting with offshore engagements. Here we list the 5 main mistakes that companies tend to make when starting on an offshore engagement, and how they often lead to its complete downfall.

1.    Starting without an initiation workshop

Minimize the assumptions

One can never accurately imagine what another person needs and wants without engaging the latter in the initial stages of setting up a new offshore service delivery engagement. One of the most effective ways to accomplish this is to conduct an initiation workshop with the participation of all stakeholders.

At first, this may sound like an expensive activity, especially considering this as the start of a fresh new engagement in another country. However, this is an activity where money well spent; in that, it will save much more money, resources, time and stress in the long run.

Through brainstorming sessions, discussions, sketching, presentations and more during initiation workshops, the key factors that need to be identified are as follow.

·      Primary goals and expectations

·      Working model

·      Key criteria for success

It is important to get all stakeholders for this initiation workshop (based on the relevance of topics discussed and the workshop schedule) from project/product owners and sponsors, senior management, key team members (both onsite and offsite) etc. The few days committed for this workshop will help identify the main goals and expectations, eliminate any misunderstandings and serious concerns that either party may have along with the assumptions that people naturally tend to make which are far from reality.

While these sessions could be held at either location, the customer’s location would be preferable for the initiation workshop because for example,

·      All the stakeholders are easily accessible

·      Start building a good rapport with all onsite team members

·      Observe the currently in place systems and processes

2.    Starting without getting involved in selecting the right team members

The customer is onsite, while you are not!

Many offshore service providers have found that it is very important to engage their customer in the process of selecting or hiring members for the team. These are the people who are readily accessible to customer’s onsite team.

We can assume that stakeholders at this point have reached a comfortable and effective collaboration model. Once the customer gets involved with selecting their offshore team and the collaboration model is in place, this helps everybody to build a good rapport and gel well with each other. This will go a long way in ensuring a successful end result for all stakeholders.

3.    Starting without investing in proper infrastructure

An effective and efficient collaboration model is the key to running any successful operation today. In the context of an offshore engagement, where the various stakeholders are physically unable to meet face to face regularly, excellent telecommunication equipment must be in place to facilitate the communication process. This includes both communication hardware and software that is capable of handling large volumes of data while maintaining high quality. A high-speed, high capacity broadband internet link is of absolute need, in ensuring that voice and video conferencing can be carried out effectively.

Anyone who has participated an online video conference call will know how difficult it is to concentrate on the discussion at length. This difficultly arises as a result of the lack of face to face presence of the participants. This is an unavoidable complication in offshore service delivery model; but this is a difficulty that can and should be eased as much as possible with the use of best quality communication equipment and services that can be obtained. Such equipment includes powerful enough computers, regularly updated communication software, a sound-proof meeting room with proper lighting, sensitive multi-way microphones and sound systems in addition to a fast-broadband link.

It has been noted one too many times that many companies who go offshoring do not give the due prominence that communication equipment deserves when setting up budgets and investments for their offshore engagements.

4.    Starting without budgeting for offshore team visits and vice versa

Subsequent to the initiation workshop, periodic visits between the onsite and offshore teams are vital in ensuring a successful offshore engagement. To be clear, both teams must visit each other. This gives invaluable insights on to the social and cultural differences of the other team, which would otherwise never been seen nor understood. And it is the sensitivity shown towards these differences that could help make or break the working dynamics between the two teams.

Also, in certain offshore engagements, it is necessary for the offshore team to visit the customer site and experience the use of the systems they build in real production environments other than simulators/labs maintained offshore. Say for example, if the offshore team is tasked to automate the operations of a robotic manufacturing line, then the offshore team must visit the production environments and experience how the system behaves in reality rather than only working with simulators on offshore labs.

5.    Underestimating the impact to the customer organization

For those customers who are beginning their very first offshore engagement, it may not strike them as important to pay close attention to the differences that they would have when compared to the offshore team. The customer’s team would have a particular modus operandi, which has proven itself effective and is likely to think that there is no need to tamper with a system that already works.

While this may well be true, it does not mandate that the same modes and methods would work for the offshore engagement as well. The workings of two different nations will always have their differences. A simple example would be around national and religious holidays in each nation, and how team members celebrate these events. For example, in Myanmar, the water festival held in April is the country’s biggest festival. Three days of holidays are declared, during which it is near impossible to expect anyone to be available for any kind of work. It is important then, for both the onsite and offshore teams to be aware of this, and ensure that work, calls, meetings, reports etc. are planned well in advance or beyond these holidays. The mid April new year celebrations in Sri Lanka is a similar example.

In addition, it’s important for the onsite team to understand how those of the offshore team address their work ethic. Should any differences arise, it is important to carry out discussions and orientation trainings in order to agree upon a common working model that is agreeable to both.

Conclusion

A little advance planning and preparation can go a long way in ensuring that working offshore becomes beneficial to all parties concerned. While none of the factors listed above are of technically complex nature, they are crucial soft components that must be addressed, and periodically monitored in order to make sure that all stakeholders benefit from any offshore engagement.

Do you agree? Would like to hear your thoughts as well.