Thoughts on offshore development

Technology Chef

I was talking to my good friend Tom at lunch today and the subject of outsourcing arose. He made some interesting points and I'm inclined to agree.

The primary purpose of offshore development initiatives is to save boatloads of money on development projects. On the surface, this is good for business. Yet, after considering the hidden costs, I'm not sure this really works.

The typical project using a waterfall methodology involves analysis, design, coding, then QC. Tools and techniques such as .NET and Agile Methods have shrunk the development time by orders of magnitude already. Taking this offshore does not result in a huge savings since development is a miniscule portion of the total project effort.

My experience shows the bulk of the time is spent in design, testing, and pre-deployment activities. Most of these activities are not readily taken offshore because of too little planning and design, and too much conflict between language, culture, and time zones on the back end. Another way to say this is to assert that the design, QC, and Deployment are generally done in-house and this is where the bulk of your costs arise.

Let's assume we send development offshore. We just exacerbated the project communication by introducing culture, language, and time zone issues. This can become expensive. To overcome this, we need to spend much more time and money in the analysis and design phase. Our specifications must be rock-solid and thorough since the developers do not share the context within which the product needs are created. On the back end, we must still conduct exhaustive QC efforts because we don't want to bet the company on a team that has little to lose if it doesn't work. The in-house team must perform more tests and spend more time documenting defects to overcome the language and timezone barriers.

When all is said and done, the actual savings expected by taking work offshore are not realized because the setup and validation costs are so much higher. When this is combined with morale and retention in-house, it make sense to think long and hard before sending the business overseas.