Why do IT managers outsource all development to the same geography?

Remember when all programming work was completed in-house? After all, it wasn’t so long ago - just a
decade, perhaps - that outsourcing was seen as the refuge of the desperate IT manager.

Nowadays, outsourcing is a standard business practice. Moreover, many experts believe it would be anathema to not call upon a multi-sourced approach that uses best of breed IT and services from a range of different providers.

What does the multi-sourced approach mean for technology development and are companies making the most of their outsourcing arrangements?

Outsourcing has traditionally been perceived as a cost-cutting strategy, but the broad range of companies selecting to externalise crucial areas of IT provision means outsourcing has moved from the margins to the mainstream.

Diversity has increased and advisory firm TPI reports that 13 vendors won contracts valued at more than £15.7m in 2007, compared with just 99 in 2003.

Many IT managers, therefore, are waking up to the benefits of a multi-sourced strategy. However, fewer have been smart enough to wake up to the issues of geography.

While technology leaders are keen to avoid sending provision to a single firm, many businesses still outsource activity to a single country, such as India or China.

Picking a single location should make localisation easier, allowing the IT leader to bend multiple firms in one country to a broader business model, rather than a series of firms in many countries.

But taking such a selective approach is a bit like old school outsourcing – you only get the benefits of working in one country, rather than many nations.

More than just allowing your company to draw upon skilled-up IT expertise from across the globe, a multi-geographical outsourcing strategy will allow you to make the most of time differences.

So, early morning you set up the strategy in the UK, ping development objectives to your Russian developers at mid-day Moscow-time. The finished code can then be tested in Sao Paolo, ready for your arrival at work the next day.

Simple and effective; a clever multisourcer will also be multi-locational.


Copyright © 2009 IDG Communications, Inc.

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