Outsourcing an IT project, finding freelancers or starting a geographically spread IT team?
Technology decision-makers are increasingly under pressure. It is a norm for organisations to source extra talent externally in search for competitiveness and more value creation.
BUT – it usually proves to be not as simple as it sounds and like many other business owners, Leon Chaddock, CEO of the company Sentiment Metrics has had to face this harsh reality: ‘’ we found it very hard to compete for the best UK talent with the salaries on offer in the City’’. They now have successfully set up their own dedicated IT team in Bulgaria using Questers’ platform.
Globally, talent availability and competition on attract-and-retain are becoming increasingly challenging not only for young businesses but also for established organisations.
There has been a growing awareness of the potential of offshoring to support a range of strategies beyond the lower costs. Still, what are the risks one must consider before extending their team near-shore? And what are the real opportunities and rewards?
We focus on 3 main aspects and opportunities that at Questers we consider every organisation should take into account when choosing the path of geographically spread talent.
We see this as our key value. An open book policy versus the traditional ‘’blackbox’’ approach, is what ensures the full commitment of the IT talent. We usually measure levels of productivity of a distributed team to be the same as the in-house one. That’s largely due to the culture that drives commitment and motivation at the head office. And this is impossible to achieve with different attitude and standards.
Costs arbitrage is often a main reason when deciding to outsource and an obvious outcome. When setting up your own dedicated team abroad, with the right level of transparency over the payment of work contracted, you can indeed reduce your IT and development costs and build significant value. Getting to work with committed and motivated people means high productivity levels are quickly reached. But a word of caution: Never base your decisions only on cost saving in absolute numbers. You should always consider and balance the risk levels to identify the true value of starting a remote team, as well as the potential ‘cost of unit of productivity’, though benchmarking this is a huge challenge for the entire industry.
- Direct collaboration
The lack of control is often a critical issue reported by companies who have had a project delivered ‘externally’. When outsourcing it is rare that the third party will ever let you be directly in contact with every single team member working on your project, not even thinking of direct control over the delivery of each of them. And that is a nonsense itself - such direct collaboration and lack of bottle-neck units is essential for the project delivery, especially when talking about essential pieces of work. Starting a dedicated team offshore is a way to guarantee the performance. That way the company culture and the knowledge will be shared, while safely retaining control over your IP.
Innovation is another opportunity brought to geographically spread teams with bringing in new culture, fresh opinions and new synergies. If you foster collaboration at all locations quickly those synergies will take place and the overall level of productivity and innovation would increase. Near-shoring disrupts and challenges but also brings new perspectives and ideas. Usually having cost advantage enables bringing in more senior people than at home. The platform enabling collaboration with such fresh talent pool is highly valued by Questers clients and our clients’ clients.
- Distance and format
A nearshore team located in a similar time zone is likely to make it easier on managers and teams to organise daily communication and working together. Our experience proves the expectation should be also that the culture difference would be far less than starting a team on a different continent. Having your remote engineers nearby would reduce the communication discrepancies and delays. Finally having your home team travel more than just few hours each time you need to visit your extended capabilities might be a challenge. Eastern Europe, and Bulgaria in particular, is a fantastic destination in relation to this.
The flexibility you gain in diversifying the locations of IT development or R&D centers is critical and recognised long ago. However as seen with many companies it could be a major distraction and a waste of precious senior management time. Working with a partner who understands the essence of your motives, and provides the right platform, allows you to focus on the core of the business without distractions.