There are several different kinds of outsourcing models and it is important to choose one that is appropriate to purpose. One such model that has many advantages is the Offshore Development Centre or ODC. Over recent years it has become an increasingly popular approach as it provides improved visibility and control of the development process.
Essentially an ODC is used for the offshore development, test and deployment of software with the advantage of having a dedicated core team. The ODC consists of a dedicated team of developers and programmers who have been selected to work for the client with the right skill sets and ability to adopt the client’s culture and working practices. The team is managed by a project leader.
The team is based at the ODC provider’s site and works within a secure environment. This has the double advantage of maintaining an outsourcing relationship while also providing what is essentially an extension of the onshore organization, thus it is closer to dealing with employees rather than with vendors.
Generally an ODC is a more cost effective solution than the conventional outsourcing model. A local project leader is assigned to the development team and is responsible for ensuring that the requirements and expectations of the customer are met.
Generally the cost model is based on a fixed monthly fee over the course of the project or set of projects. Regular reviews are carried out in order to evaluate performance, to assess quality, to review costs and so forth, just as would happen if the project was being carried out on the customer premises.
This means that the customer can run the team as if it were their own and thus gain a greater insight into its functioning and cost control, so extracting maximum value. It also means that the team can be focused on delivering value to the business rather than simply focussing on the task of developing software as a deliverable.
Additional flexibility is provided by the ability to up-scale or down-scale teams in the light of changing requirements or other needs.
Essentially with an ODC a customer has a dedicated core team along with a work area that incorporates the customer’s culture and brand along with an infrastructure that is aligned with that of the customer. Security and privacy policies are implemented that meet the requirements of the customer along with the regulations appropriate to the customer’s jurisdiction. Training, education and HR programmes are also defined by customer requirements.
Some of the main differences between an ODC and conventional outsourcing include:
• A medium to long term contractual agreement with continual planning rather than individual contracts for each job
• Investment by the supplier in the ODC team and commitment to delivering value rather than simply implementing the task
• A dedicated core team which is flexible according the changing requirements
Working with an ODC
Working with an ODC will naturally have some challenges for those unfamiliar with doing so and it goes without saying that excellent communications are crucial. It is important that the customer gets to know the team, just as if the team was based on premise, and is aware of the skill level and expertise of individual members. Assembling the right team is vital and often it is possible for the client to be involved in this process.
Selecting the right projects is also important, though the ODC model is appropriate for all kinds of projects from simple tasks through to large complex projects.
There are also many benefits of working with a team in a different time from your own, especially when working with projects that require a rapid turnaround. Of course there potential downsides too, particularly with face to face conversations, though these can be overcome without too much difficulty. Essentially, once you get used to the idea, coordinating work between your in-house team and an ODC is as straightforward as if the overseas team was in your own country.
The cost savings of an ODC can be significant, and once management procedures are in place and understood managing the ODC is little different from managing a team in your own country. Due diligence is required to ensure that you are happy that any risks have been mitigated, but the ODC model has delivered outstanding benefits to many companies worldwide, and will continue to do so into the foreseeable future.