Worried About Outsourcing? Get the ABC Clear and Then Jump.

It has been quite sometime now when I moved into Sales at Mindfire.

As I talk to customers on a day in and day out basis, I feel sorry for customers who have had a bad experience dealing with offshore vendors. The customers themselves know that their experience is one rough instance in the global outsourcing industry but since they have failed in the few attempts they had made at outsourcing, they often tend to tell themselves – Jeez, I dont know.. Somehow people say that Outsourcing is a multi billion dollar industry and majority of the firms outsourcing work to India have had good experiences but then I dont know.. Just does not work for me.. or its not my piece of cake.. or worse.. I would never ever outsource again!

Well, the bad part is that you are losing out on the advantage which your competitor gets. Your failure may be attributed to a lot of things. We will touch upon each of these one by one in subsequent posts.

Case#1:
Dedicated Support – 8 Hours a Day.

I recently had a customer (Peter) who is in New Jersey. He stumbled upon Mindfire after hitting a search in Google. The first question he asked after I introduced myself and said we can assign him a dedicated developer was – Sam, How do you ensure that the person is only dedicated to me at the price X you are quoting me? I was a little surprised to hear the question but then I wanted to know the background of why the question was raised.

He heads a Publication Division in a reputed company and wanted to venture out into making of an iPhone app for his own venture. And he did a Google Search and reached out a company who charged him X/3 rate (Remember Mindfire charges X) and he was happy to get a deal and he signed the contract. The developer assigned to him was dedicated to Peter’s work only. At the end of the month, Peter wanted to review the work output of the developer but could see that only 30-40% of the work has been done and whatever has been done, is not usable at all. He wanted to move out but then he had spent time already and could in no way move out all of a sudden. He decided to caution the developer, pay for the second month and continue 1 more month while at heart he had started feeling low already. He discussed this casually with one of his colleagues who said that he is also outsourcing to a company in India and working with a dedicated developer and he too is not happy with the quantity and quality of work output. Out of curiosity, both Peter and his colleague shared the name of the company and the name of the developer working on their projects. They were in for big surprise!! The developer was the same person who was dedicated to both the people at the same time!! No wonder why the outsourced company in India was able to afford such low rates (X/3)!!! They had the same people allocated full time to multiple people at the same time. This was just a coincidence that Peter and his friend were colleagues and they could find out the issue, whereas, there can be others who would never discover this fact. This is the reason work output is lower in companies who charge you much lower rates. Exchange rate of USD-INR is the same of everyone in the country. So if someone charges you X/2, X/3 – Beware. You might need to do a little bit of more research!

Moral of the tale:

It has to be understood that while software salaries are on the rise in India, no company can sustain at rock bottom prices. If they are doing so, this scenario cant be ruled out. At the end of the day, the guys are running a business for a profit too. So if customers are lured by attractive pricing which seems way off that the normal pricing- please be aware.

Please feel free to email me at subhendup@mindfiresolutions.com and I would be glad to take up your questions.

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3 thoughts on “Worried About Outsourcing? Get the ABC Clear and Then Jump.

  1. Pingback: World Spinner
  2. Globalization brings a very competitive scenario among the outsourcing business. One of the new sector emerging in market is Outsourcing software development .

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