How to do it right - Setting Up An Offshore Development Center

Since an ODC plays such a strategic role in a companies operations, conducting thorough due diligence on your vendor is critical. The questions below give some guidelines for the types of aspects that customers should examine when choosing a vendor as an ODC partner.

Strategic

  • Does the vendor understand the company's business goals andobjectives?
  • Is there clear understanding and buy-in from senior management as to the objectives of the ODC?
  • Are the short and long term ODC objectives clear?

HR

  • Is the right management in place to manage the ODC operations?
  • What safeguards are there to ensure the continuity of the ODC's key resources?
  • Is there a process for staff transition planning?
  • How is the ODC staff motivated?
  • Does the company offer any guarantees on staff attrition?
  • How is the ODC recruitment process conducted?

Flexibility and Customization

  • "What degree of flexibility in terms of staffing does the ODC vendor offer?" With how much notice can you ramp up or ramp down FTE?
  • Can you interview and select the ODC Project Manager and other key team  members?
  • Is it possible to review the team at any time in the relationship?
  • What is the minimum number of heads to set up an ODC? What level of flexibility is offered once the ODC has been established to ramp up or down?
  • What is the ODC workspace like? Can this be tailored to your needs?
  • Is co-branding allowed?

Communication

  • How does the vendor manage transnational communication?
  • What is the standard of English proficiency at every level within the ODC?
  • What communication methods are used ie. video/conference call, email, status reports, msn or proprietary messaging tools?
  • How frequent is the communication?

IP Protection

  • Is the vendor a pure service provider, or are they a product company as well? Pure service providers do not have any interest in customer's product IP; choosing a product company with similar product types has higher risk of IP related issues.
  • What security measures are built into the infrastructure? Look out for items such as 24/7 CCTV cameras, access levels, biometric door locks, secure phones, printers, faxes, disabled computers etc.
  • Is the security system regularly audited?
  • Does the company follow any internationally recognized system and process? For example, CMM Level 5 and ISO 27001 procedures. Vendors with international certifications typically have a modern view of IP protection.

Systems & Processes

  • What systems and processes are in place to ensure on time/on budget delivery?
  • What measurement and metrics are in place to align the operation of the ODC with corporate goals?
  • What quality management tools are used?

Lastly, cultural compatibility is an area often overlooked but equally important when selecting the right partner. A fit in terms of mindset, competence, communication and collaboration cannot be underestimated.

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