An interview with Tom Horvei | Outsourcing | Future Processing - YouTube

First time,

it was because we needed really peculiar skills and special competence in a project.

It was nowhere to be found within the borders,

so then we just had to go abroad to find that very special competence.

That was the very first time that we not only outsourced, but also offshored.

The second time,

it was merely a matter of having bigger needs in a shorter period,

so that we would be better off getting an external team to do our things.

I would say three Cs.

So - Capacity, Competence and Culture.

Make sure that they have the capacity to actually dedicate time to your project,

not have a team doing it parallel to another one.

And then, the competence that you want.

You basically want those people to be labeled to exactly what you need

and they should have a culture that fits with the culture within your company.

I would say, an open culture that lets you, as a customer, in.

I would say that, whether it’s overseas,

or whether it’s just down the street for you,

it’s all about getting somebody that’s really fitting.

You have to keep in mind that the contact should be close,

that it’s still your project, you cannot outsource a problem,

the problem is still there for you to solve it.

You’re just using somebody else parallel to you.

So, keep in mind that the communication needs to be good all the way.

In addition to the criteria you go for when you’re selecting the consulting house down the street,

you especially think about culture as a national culture,

to get the good gut feeling and then think about the practical things

can you get there often? Is it in a time zone that you can live with?

That sort of thing.

Yes, it is.

It is important to understand that with the small software department in house,

you will never be able to maintain the people,

to inspire them, the way a bigger environment of developers can do.

To build competence in house is so difficult and,

in most cases for most companies, it’s off their core.

Even though you have a software department, even though you develop your own software,

you’ll always find the tasks that go a little bit on the outside of everything that takes away inspiration,

that takes away time that you need,

and then outsourcing is a wonderful business model, if you do it in a right way.

I would say getting close to the project,

to still remember that it’s your project.

It’s not somebody else’s problem,

though you’ve signed a contract with an outsourcing partner.

You have to keep in mind that all way along you need to influence the processes,

you need to influence the development,

and you need to see that this is becoming what you’ve dreamt of.

We all know, since we’re in the business,

that a way from the spec, no matter how much you worked with it,

to an end product is a long one and things are not quite how you envisioned them from the beginning.

And therefore you just have to be close to it.

For us, outsourcing meant that we didn’t have to recruit people in a difficult market,

we didn’t have to put a small team together,

without the capacity to actually give them the knowledge that they needed to solve our specific problems.

For that reason, outsourcing was a huge success,

because in a short time we got a dedicated team,

caring only about our problems and we got an end product that we are now really proud of.

Well, I was skeptical to offshoring, for sure.

I thought that especially in the late 90’s, when the capacity was scarce in all of Europe.

You couldn’t get developers and lots of projects went to Indian markets

and we saw the bad things happening.

There were problems with culture, problems with time zones,

problems with communication, all way long.

The trip there was so massively long,

we didn’t want to go there every second week, every month to that matter.

And then you just ended up ordering bananas and you got apples back,

and then you complained, and then they sent you pears,

and you ended up with a melon.

But that was still a problem,

lots of money went out the window,

actually more money than if you have gotten a closer outsourcing partner to begin with.

What changed my mind was that at some point we had to offshore,

because we needed competence that wasn’t within the country

and we were just really conscious about not making those mistakes

that we all have been part of making

and we’ve seen others make.

Therefore we just decided to be closer to the project

and we were opened with our offshoring partner at the time,

with our skepticism and our worries,

and they were opened back,

and together we’ve found a key, a way of doing it.

That worked, and that has worked ever since.

Of course, you will always find extremely strong personality,

with strong opinions around your product.

As long as you're engaged, as long as you’re aware of cultural differences,

as long as you keep in mind what’s your vision with the product,

then you will end up with a very good end result

and losing control well, it hasn’t been a problem.

Obviously, when you’re looking for an outsourcing partner, and you’re looking offshore,

then money is part of it.

You should also see it the other way,

since it’s a way of getting a bigger, more dedicated team,

to fit your budget.

But for a while you should forget the budget bit

and you should look at them like you would look at any outsourcing partner.

Then you have to look at how they’re organized, how they would fit your way of working,

whether they understand your business, whether they have experience in your field.

And when you’ve done that, and you have gotten some rapport with the company,

you established your first contact and all that,

then you should, at an early stage sit down and call the references.

Talk to them,

because this is so important and a lot is separating the good ones and the bad ones,

but sometimes it’s not easy to see,

certainly not by just looking for a few minutes at a web page.

And when you’ve done that, just find a way of working together,

where you can actually share your worries and your thoughts all the way long,

and make sure that you culturally fit with them.

This would be good to do in a pre-project.

Once you feel that this is running smoothly

and you actually have good communication,

then you can go on and say:

Ok, this will be our partner for the rest of this project.