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Offshore Outsourcing Models

Offshore and Nearshore

Outsourcing can be done either offshore or nearshore. A software company showing a greater degree of innovation in its IT initiatives would prefer to ship its work offshore rather than inshore as offshore development provides access to talented, experienced developers who can respond to the need for a complex business solution or application, quickly and cost effectively.But There are risks involved with geogrophical locations of offshore companies aswell. There are several other models to choose from, including those with and without a U.S. presence.

Offshore firms without a US presence:

Difference in the time zone may raise the problem of communication between the client and the offshore project manager in the case of a firm without a US office. Communication is usually via email or telephone but at times it becomes absolutely necessary for the project manager to travel across the globe to visit the offshore needs. The offshore company generally has its resources intact and can work on the project right away but at the same time it is difficult to verify the technical expertise of the project team and to establish a strong working relationship with the project manager. Reliability and security concerns can also be issues when working with these firms.

Company with only a US sales office:

They offer lower rates but despite a local escalation path, the level of customer service they provide is limited by their lack of local technical expertise. The project manager is located at the offshore facility so communication occurs via phone and e-mail, and the lack of visibility to the project team and facility can raise reliability and security concerns.

Company that has a US office:

With onsite analysts, project managers, and developers they offer slightly higher rates, but they are able to respond to client requests much more quickly and easily because local project managers team up with both U.S. and offshore technical resources. Due to excellent customer service and increasing popularity, this model happens to yield better gains than the others.

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