7. IS THERE SUCH A THING AS A MATCH MADE IN HEAVEN? |
In his book, Paul Davies (‘What’s this India Business?’, Nicholas Brealey Publishing, 2004) has a whole chapter on offshore supplier selection and the soporific effects of being subjected to the same presentation over and over again, each time from a different supplier and each time containing the same endless lists of quality certifications, pictures of humungous office campuses, diagrams showing gigaflops of bandwidth, massed ranks of eager programmers, etc. Choosing a partner for an offshoring project is never easy, particularly for medium sized companies who have little experience of operating in Europe let alone the developing world. In our experience supplier selection questionnaires all follow similar themes. We have completed many and have written quite a few ourselves. Generally they cover the basics pretty well but many miss out on the one area that we believe is vital, namely finding a supplier with whom you have real cultural synergy. You need to look deeper than just the personality of the sales person. You should aim to gain a pretty deep understanding of the organisation and meet at least one senior relevant player (hint: finance director probably isn’t that relevant). Try to establish their capability as managers, what are their corporate values, how do they work, what are their personal values? Then look to see if these are reflected in the organisation. Don’t be shy, ask for evidence! Customer references can be very helpful here. Ask the difficult questions about how the potential supplier behaved when things go wrong (we guarantee they will). But remember there is no right or wrong here, just good and bad matches. A collaborative supplier trying to work co-operatively with an inflexible, competitive, arrogant Customer will also end in tears. We know. We’ve tried it. It is also very important to ensure that your supplier is properly motivated to work with you. Just because you are a Customer doesn’t necessarily make you valuable in the eyes of potential suppliers. “What’s wrong with my money?” . . . we hear you cry. Sophisticated buyers of services such as offshore outsourcing know that only win-win relationships will deliver sustainable value to the Customer. So work hard to really understand what is in it for the supplier. Look beyond just revenue and profit. |
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8. TO PILOT OR NOT TO PILOT, THAT IS THE QUESTION. |
“Pilot projects, don’t talk to me about pilot projects!” . . . these days it seems that everyone has to have one. Seriously though, it’s easy to see the temptation. You’ve done a supplier selection, you think you’ve found a partner, they’ve said all the right things and the Customer references worked out well. You met the CEO and he seemed like a decent chap. But you’re just not quite sure. There is so much at stake and you’ve got some saboteurs in your team who are just itching for it to all go belly-up. Maybe you should test them out with a pilot. Then you’d have some concrete proof. Proof that the supplier is capable. Proof that offshoring works. So what do you do? You find a small project, say a few weeks or months for a handful of people. You get the chosen supplier to pitch in with a proposed approach. They don’t know you and you don’t know them. You want to be able to sit on their shoulder with a magnifying glass and watch what they do. So you want it to happen on your site, anyway they don’t know anything about your business, your IT systems, processes, etc. so you guess they’ll have to be helped a bit – better make it onsite. This will be a good test of their people so you don’t want too much interference from their management. Maybe you’ll manage their team yourselves then you’ll really know what they’re capable of. |
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OK, back to basics. You’re ultimately trying to build a virtual joint-team with a professional global software services company. The target team will comprise of say 15 to 20 people, 8 to 10 of which will be from the supplier’s team working 7,000km away in India under the supplier’s management. They will work with your processes but these will have been adapted to work in an offshore context. The supplier’s team will have gained knowledge about your business and IT system and as importantly will have built up good working relationships with key people in your team on whom they will depend. They will have a colleague or two working on your site acting as an intermediary / fixer. Their management will be able to bring to bear their considerable experience of making offshore work to control what happens in real-time and immediately intervene and escalate to you if problems start to arise.
At this point, however, you know nothing of India and have probably never been there. You and your organisation have little or no experience of offshoring. Half of your team are on board, the other half – probably the technical staff on whom the supplier’s staff will depend – are against. So you’re going to tell your supplier to throw some of their people – probably their best people – into the lion’s den. It is difficult to see what this is going to tell you. Not really very representative of the end-game, is it?
We know. Not all pilots are like this, but many of the ones that we come across are depressingly similar. Time and time again we see Customers commissioning pilots that have very little hope of success. They demand the supplier perform a minor technological miracle whilst their every move is being watched under a microscope. Performance during the pilot (quality, productivity, timescales) will be bench-marked against the internal team who have built up their capability over many years. Often, the supplier doesn’t have a hope in hell of succeeding and only a super-human effort by the supplier’s team – by now much experienced in such foolhardy pilot projects – can save the day. The really sad thing is that everybody loses, not just the supplier. The Customer learns virtually nothing from this exercise, except perhaps that the supplier has a few very talented and very committed people who are willing to sacrifice countless evenings and weekends to achieve the virtually impossible.
There is a simple way out of this mess. Just start the offshoring project. Working closely with your supplier, define an offshoring roadmap that provides you with a number of pre-defined go/no-go decision points along the way. Make sure that the critical success factors for each of these decision points are clearly defined and understood by your team and your supplier. Then get on with it.
Our experience at Arrk is that 90% of all pilot projects are a waste of time and money. Nevertheless 90% of Customers want a pilot project. You can take a horse to water, but you can’t make it drink!
Missed previous Great Ways episodes?
View more Great Ways: 1 & 2 | 3 & 4 | 5 & 6 | 7 & 8 | 9 & 10 | 11 & 12 | 13
Learn how to avoid all the mistakes of those that have tried and failed...
The tips above are taken from my paper '13 Great Ways to make your Offshore Project Fail'. Rather than waiting until next time, if you'd like to receive all 13 Great Ways in full now then please just complete the free enquiry form on our web site by clicking here or call 08 456 210 278 and we'll send you a copy of the paper free of charge (perhaps there is a free lunch of sorts after all!)
Arrk Group is a UK headquartered, award winning global IT services company specialising in the design, build and ongoing operational management of complex and secure web and mobile applications for both Independent Software Vendors and end user organisations. Established in 1998, our unique position and experience provides us with a deep understanding of the offshore services market. We recognise not only the benefits but also the pitfalls and limitations of the offshore phenomenon. This sensitises us to the difficulties often faced by organisations that are relatively new to offshoring and enables us to offer Customers prudent advice on a global service delivery strategy that delivers the best balance between risk and reward.
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