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Is the world really flat?

September 5, 2011

In my previous posts I have talked about oDesk and global delivery model, how the concept of “world is flat” was espoused by Thomas Friedman. After working with India teams closely for the past two months I now doubt the global delivery model and whether the world is really flat? Before getting down to my experiences I want to put a context to my current situation for objectivity purposes as well the reader can better appreciate my perspectives. Citibank and GE were pioneers in outsourcing but off late I have seen some reverse trends as GE recently hired more than 1100 in the IT field.

Our current company is a very small and I recruited a team back in India – Delhi to do all the design and development work. Before settling on an India team I myself tinkered with the code base and given that I was not into design I have approached on my college buddies who was in Europe at that time to help out on the design as well as contacted an Indian team. For the design work I got a quote of $3K from the Indian team and from the European counter part E20K. Given the size of my company and where it was in the overall life cycle I chose to go with the Indian team – with price being the single most important criteria.

The team back in India started off with flying colors but the story began unraveling very shortly, the team on the ground was not capable of coming up with new designs, delivery was not on time and project management went to dogs. I had to change the team and the story repeated. At this time I started to question the rationale behind outsourcing and below is what my learnings are from this experience

1) Outsourcing might be good for very large companies or those industries where the turn around time is not measured in hours

2) Cost should not be the only criteria for outsourcing (unfortunately in most of the cases it is). When it comes to user experience it is better to have a team here in US

3) For startups like my company you either have a team here in US or if possible have a partner in India who is committed to the idea. In a nut shell your tech guy should either be here in US or in India (not an outsourced partner or a team that you hire)

4) Significant project management skills are required at this side of the table to manage the team back in India (BTW the most common refrain from the dev team back in India is that it works in India)

5) The US team day finishes very late in the night (as you spend considerable time directing the team on what to do and how to do) and starts very early on as you want to test what the India team has finished (hopefully they would have done something by that time)

So for very early ventures like mine outsourcing model has many disadvantages over advantages (cost) but given at what stage we are where $ is everything – we just have to suck it up or find someone here in US who is techie enough and who believes in the idea and is willing to roll up the sleeves and start coding.

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