Journalist and writer focused on technology and business development. Author of two books, game designer, marketing & PR specialist.
As a company who lives from outsourcing, we’re never going to be threatened by cheap versions of our services. There’s quality and quantity. There’s awareness of business value and there’s making shortcuts. We haven’t played that ball yet, and we’re not about to start.
Let’s rack up the arguments that go behind low-cost offshoring:
Usually it’s a range from $12 to $14 per hour. Comparing it to $125 per hour in the US and a reasonable % in Europe, Far East can work for a friction.
… and that’s pretty much it.
To risk running a project with people concentrated on making up for the price in volume is not a sign of receiving a valuable and working product. The cost of upgrading the product to current standards or the code review alone can effectively impact the reasonable capacity of the budget.
There can always exist concerns about the effectiveness of real-time communication. In light of time difference this point can be valid, but the antidote is quite simple – the Client list and the quality of products themselves. Can you see them on the developer’s website? Are they functional? Are they market-ready?
What else should you ask?
There’s also the question of the reduced sense of accountability and commitment. The answer to this one is simple – ask questions during the conversation with the sales department. Try to anticipate if the Product Owner on the contractor’s site is giving to the role of the extension of a representative of the sales department? Or maybe he or she is trying to genuinely ask the right questions to find out more about your business and its needs?
In search of value, vision and reliability.
Resource quality is an interesting topic. At some point there is always going to be a boom for certain types of schools, jobs, and expectations. Marketing Specialist, Lawyer, or QA Engineer. If you have enough money and three months at your disposal, turning into one of those three is simple. That’s not how it works. It can be compared to weekend psychology courses. It’s not a serious commitment, it’s not a serious learning method.
Finding a talent in these conditions is a hard and ungrateful task. It’s most certainly possible, but it’s not worth the effort. Not in the traditional, full-team scope at least. In a system that is a mistake, a diamond in the rough is a rarity and he or she still has to be elevated in terms of skills and the cultural mindset. It’s hard work, rarely gratifying.
For some parts of the world, it can be even 12 hours’ difference. There is no rational and effective method of cooperation in this kind of environment. A lot of companies move into the Agile and Scrum area of making things happen and when the conduit between a provider and a Partner lives in two time zones at once, there can be no real cooperation between all of them.
E-mail based communication is not effective in complex situations and does not provide the means to solve them. It’s better to talk things over via Google Hangouts or Skype. Agility provided with the modern methods of developing software products compensates for the illusive loss of time and effectiveness caused by different time zones.
There is always someone willing to do it cheaper…
The potential provider turnover rate is also something to consider. 8-10% is a standard but asking the provider the same question about the rate of the project is quite different. There’s a possibility of dancing around this matter. For a provider who has nothing to hide it shouldn’t be a problem and a straight answer is expected. With an unstable developer, the rate of 50% is not uncommon. In some parts of the world it’s even quite expected, but that’s the cost (and quality, we might add) of the low-price business model. Or rather none at all, because it’s a normal ‘business’ practice to leave the Partner only with a price with nothing more to back it up.
Mindset, work ethics, and life experience
It’s hard to be motivated when you don’t fully understand the needs of the project and, most importantly, the business goals behind it. Life experience doesn’t always prepare you for what’s happening so having a backup plan in form of a mindset is always a reasonable lifehack.
The Partner’s mind is set on a project. He or she places an order, signs a deal… and then changes his or her mind. The business is changed. The market environment is changed. The competition has just launched a better, even more advanced solution. What does a cheap developer do? We know it from the first part of this article: very little. Remember the ‘low-price’ thing? There’s nothing they can do.
A low-cost developer has no established remedies for complex situations. No means understood as man- and firepower (already developed projects and lessons that come from them) to contain the situation and suggest something valuable.
One city is full of men and women with dreams and aspirations. They go by mainly because of the low price, which is questionable in the eyes of value-oriented, modern business environment.
And then we have the other city. Fully functional, has developers with vision, passion… and experience. Low cost quite often means that companies leave you with a not-so-quite-sustainable mix of mediocre and not very experienced developers with one senior developer overseeing the rest of them. That’s not a healthy method of creating any kind of product.
Low price or fair price? Quantity or quality? If you’re willing to pay your plumber, don’t expect the developer to work for free. You can get the same product, but the difference will be more than noticeable. The choice is yours but keep in mind that software around the world moved to Scrum a long time ago. The rest of it is destined to follow.
Photo credits: Flickr, Jon Acuff.
We have 10-years experience with over a 100 completed projects in Symfony2, PHP and Java. Our mission is to help people around the world achieve business goals.