PlusNet; Our Software Development Location Strategy (and other stuff)
I suspected it might be!
A: "He who dies with the most toys, is nonetheless dead"
B: "Well, yes, but he had the most toys"
A: "He who dies with the most toys, is nonetheless dead"
B: "Well, yes, but he had the most toys"
Quote from: the That is interesting.
I work for a company with significant numbers of outsourced jobs in India and travel there about once every 3 months. My experience is with business processes and the benefit to uk customers is that the difference in salary etc keeps the cost down. With IT development (not my area of work) the pressures seem much harder with wage inflation being really high - particularly in the big IT labour markets of Bangalore and Chennai.
Yes, I agree. The traditional IT Centres such as Bangalore, Mumbai, Hyderabad, Chennai & Pune have, over the last few years, seen resource costs rise at around 20% pa. This has caused some of the early adopter US companies to pull out as any cost savings are negligible compared to the perceived increase in risk with offshoring. However, scattered all over India are the next cities to emerge; with lower costs and extremely large resource pools.
Far, far more important than any cost saving though is the actual competence of your offshore partners. When we first made a serious commitment to look to India at PlusNet, cost wasn't the primary factor; we were looking for good people to assist us in building our platform. I mentioned in my blog that finding enough exceptional people for our Sheffield office was proving tough, so we made the commitment to look further afield.
Quote from: the The other thing is that when your doing strategy it's good to do it collaboratively and that means intercontinental travel which makes it more costly. Profit margins in your business seem really tight. Is the cost a problem for you to be able to sustain it for the next 3 years or so.
Yes, there is a cost here, but it's really not that much in the general scheme of things. You can get from Sheffield to our Indian base for around £500, including flights and trains. Hotels and food over there is ridiculously low cost when you know where to go. Stay away from the Western branded "Business Hotels" and stay in a tourist resort and you're looking at around £25 a night for somewhere very nice; as for the cost of food when you get out there; you get change from a few quid if you know where to go...
Having been through a costings exercise for both our Indian and Polish ventures, I am confident that on a purely cost basis that we have at least 4 years of mileage from this. We may reach a point where it isn't "cheaper" to work with our Indian teams but, by this stage, we have an office full of guys that are expertly skilled on our software platform, understand the culture of our business and ultimately are an integral part of our business. At that point we'd be fools to terminate the agreement anyway.
As mentioned before, it's not really about cost, it's about identifying a bunch of talented people that we want to work with and who want to work with us in order to make our business a better place to deal with from a customer perspective. The thing which we are all clear on here is that if our customers aren't happy then we've got problems...
