Outsourcing - losing the shine

This article on ibnlive talks about how india is losing it’s shine as an outsourcing partner. There are several reasons highlighted by the report.

This doesn’t come as a surprise for people familiar close to the outsourcing business. Since early last year, a lot of the entrepreneurs i met made comments about how working with india was becoming un-economical. Friends in cisco, yahoo, hp all talk about how the companies are finding the hiring difficult, costs escalating and quality diminishing.

This is to be expected. Internet is a great equalizer. There is no reason why talented indian engineers should expect less pay than talented american engineers.

If you are running an outsourcing organization and want to stay competitive - here are few tips for you. All three of these are interrelated and you have to be really good at all the three.

* Quality.Focus on producing high quality implementations. Spend a good bit of time doing design, identify potential issues, discuss the specs and provide alternatives. One complaint i heard over and over from different people, is that developers don’t ask questions. They just develop it, and the thing invariably looks bad or fails. This includes situations where specs/mocks don’t address all cases. simple example, they may have designed a mock for a situation when user has rated an item, but no situation when user hasn’t rated yet etc.
* Communicate.Communicate status in a detailed fashion. Over communication is not a bad thing. It helps a lot especially when people can’t see face to face. People expect that as you develop, build a product things come up. It’s great if you can find a solution, but more often than not, you might have refer back to a ui designer, product manager and/or engineering manager. Take 10-15 mins at the end of every day (or when you finish a task) to write up what you did, any open issues, any help you need. Nothing irks a product/eng person more to receive a email saying ‘it’s done’ and then go look at the product to see that’s clearly not good enough to call “done”. “done” to you might mean that you did what was asked of you. Put yourself in the user’s seat to see if this is really ready.
* Timezone.All of us would like to have normal lives. Work during the day, catch a tv show in the evening, spend time with family. Working all nights is not healthy over longer periods of time and even though you make more money, it’s poorer quality of life. That said, make sure you can give atleast few overlapping hours a day with your product team that’s giving you the project. Especially, when you send the status, questions etc, wait till that person gets online and see if they can catch you. You can be available to get online late night to connect if they call you on phone. This will save time and avoid having to wait 12 hours to get a response and helps make the whole development move faster. People leading the project will immensely appreciate this.

To do these effectively, you need to have people working for your company for good periods of time (2 years atleast). It’s hard to do the above 3 cost-effectively, if your development team is churning over every 6 months. All companies are in a competitive, fast growing industry that is growing fast and they are all working hard to grow quickly, gain more business, meet needs of their customers.

Remember, if you expand by dropping your quality, you’ll damage your reputation and loose customers. Instead, if you miss couple of growth opportunities but keep the quality, you’ll retain your customers, grow more modestly, build a stronger company and have the opportunity to charge appropriately for your quality. Set a high bar for people to make it into your company, reward them well and hold them to high expectations.