Managing Offshore IT

What does it feel like to manage a multinational team? In the chapter titled Managing Globalized Workforce of my book, I gave a few case-studies / examples to illustrate the challenges of managing globalized workforce including a section on “day in the life of an Offshoring Project Manager”

The following is a live-scenario from a recent client engagement where I would occassionally muse  with the Infosys Manager, let’s call him Mr. P.  He was working hard to coordinate a program being executed out of our Shanghai and Mysore offices for the client based in Toronto. The client also has nodal offices south of the border in the US. Mr. P's typical ‘work day’ involved having to spend sleepless nights co-ordinating with teams (literally) halfway across the globe only to walk in next morning to update the client’s managers on the progress, issues and challenges. Now, this was just the tip of the iceberg.

To add to Mr. P’s challenge is the complex maze of immigration and visa regulations of countries across the globe. Those even with a cursory understanding of managing global workforces realize that the alphabet soup of visas start with the most famous American work visa : H1. And then there is the L1, B1 and other myriad American visas that allow consultants to travel and transact business for the company and interact with clients. North of the border, Canada has work permits under various programs. Other countries similarly have their individual work visas and so do a subset of European countries that use a “Schengen Visa”.

Caveat: I don’t claim any personal knowledge of any of these visas except for the visas I have used to travel to countries across the globe, which brings one to the question: Is the average Global Manager expected to know the intricacies of every visa, of every country ? No.. but it certainly helps if s/he is familiar with at least the client country’s visa procedures. This in itself can get especially nebulous when managing a team of multinational employees with their unique visa requirements.

Going back to Mr. P’s example: His team has multinational employees who happen to hold Indian, Chinese, Canadian and American passports. The client has offices in Canada and the US. The Indian manager and employees will need a (Canadian and American) work visa to travel to the client locations. For the Canadian and American employees -- assuming they are qualified Computer Science majors – American and Canadian visas (as required) would be granted at the border under the NAFTA (North American Free Trade Agreement). Here I am not stating actual facts…just beginning to set the context of the parameters that Mr. P has to juggle with every day. 

Now, add to this mix the fact that the employees in question have spouses and kids who may also travel with them and the logistics can begin to get really intriguing. The example, though illustrative,  is by no means far fetched.

I sure wouldn’t want to be in Mr. P’s un-enviable position. But then, someone has to do it, right?!

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Most of us working for software service companies are in a constant lookout for ‘opportunities’ to service customer needs, that essentially translate to more business for us. This starts right at the bottom of the totem-pole where individual Software Engineers and Programmers endeavor to ensure that they are ‘utilized’ [read : not getting to bench]….and goes to the top where executives and managers have explicit targets to ‘sell’ and grow. 

Part of the ‘selling’ of sourcing strategies also involves acknowledging the inherent risks of offshoring. More than half of the published articles on offshore outsourcing, begin with the ‘R’ word in the title, almost as if talking about risks will rattle executives looking to leverage the benefits. And this goes to the heart of a [philosophical] query: knowing what they know about the risks, why are business and technology executives still gung-ho on outsourcing? ….because they know that there are strategies and operating tactics to mitigate the risks, a.k.a “Known Unknowns.”  Also because risks and rewards go in tandem.

This said, there are some risks inherent in offshoring work-products, programs and projects to teams across geographic and cultural boundaries. In my book, I had tried to call out offshoring risks from three dimensions: internal organizational risks, technical risks and risks from geopolitical landscape.  

The recently published report “Globalization and Offshoring of Software” from ACM’s Job Migration Task Force has detailed a section (Chapter 6) on analysis of risks, though the focus is on risks inherent in Business Process Outsourcing rather than just Information Technology sourcing.

A part of the selling is also ensuring right positioning of the capabilities of offshore outsourcing in the minds of clients [and prospective clients]. An example: the article in Fast Company magazine -- Resolved: Offshoring is good for America -- features an interview with Ashok Soota one of the top leaders of Indian IT and co-founder of a services company.  The conclusion makes for an interesting read when the interviewer says:  As you point out opening markets up for competition in India created more opportunity for large multinational corporations and they became the winners and domestic producers became the losers. We cannot have globalization and trade where the only winners are the large multinational corporations and the market. Workers, labor rights, communities and the environment should be on an equal playing field as the market in the discussion around globalization

...Ah: speaking of a Flatter World?

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Sometime ago, I was presenting to a group of senior managers at PMI’s Global Congress in Singapore, an executive with a multinational software company (shall go unnamed) raised her hand and asked: “I have been tasked with governing our offshore outsourcing strategy and will be working with multiple service providers. Are there any tips you can provide?”

This would have been a typical “Aha” moment for a sales guy at a software service company – including Infosys – and an opportunity to launch into a lengthy discourse on how the Global Delivery Model (GDM) can help. I would have done the same if I were a sales guy…probably gone the full nine yards: exchanged business cards and booked some calendar time with her. But I wasn’t there to sell Infosys* or our GDM. I was there to talk about my (then) forthcoming book and the idea of an “Offshoring Management Framework,” a vendor-agnostic model to approach offshoring.

I began explaining the fact that most large organizations like her employer were trying to address similar challenges. The challenge was to find the right approach, the ‘sweet spot’ between Offshoring Strategy and executing and delivering offshored projects. A summary of my thoughts can be found in my Computerworld column “Managing and Implementing Outsourced Projects”

*Footnote: though I didn’t sell the Infosys GDM to her, we did exchange business cards and continued to ideate

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Though ‘Moving up the value chain’ is the Holy Grail of offshoring, it is a phrase most gurus and IT leaders are hard pressed to elaborate. This said, offshoring of Research & Development, and some of the high-end work is already happening.

It a topic of personal and professional interest to me as I was managing aspects of Infosys’ research collaboration with Microsoft [at SETLabs] in my avatar prior to the current North American Technology Consulting gig.

During my stint at SETLabs in Bangalore, I was fascinated by practical implications of globalization of research. I authored the paper, published in Research-Technology Management: (July-August 2004) exploring how Global Innovation Exchanges were extending R&D and innovation into the virtual world allows harnessing the problem-solving expertise of the worldwide scientific community.

The recently published report “Globalization and Offshoring of Software” from ACM’s Job Migration Task Force has dedicated an entire section on “Globalization of IT Research.” Though the section focuses primarily on number of publications in CS and IT journals as a yardstick, it throws light on researcher migration and researcher job migration.

Similarly, Knowledge @ Wharton ’s section on “What's Driving India's Rise as an R&D Hub?” makes for interesting reading. The report begins by stating "the country is fast emerging as a major center for cutting-edge research and development (R&D) projects for global multinationals such as Microsoft and Motorola as well as Indian firms. More and more companies in industries ranging from IT and telecommunications through pharmaceuticals and biotech are setting up ambitious R&D projects, in part to serve the Indian market, but also with an eye to delivering new generations of products faster to the global market." 

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It has been a few months since my book “Offshoring IT Services” hit the stands. Tata McGraw-Hill’s marketing manager I spoke with said that it is not competing with “Da Vinci Code,” or “The World Is Flat” (Yet!)*…Oh Well... However, the success of my book is not the topic of discussion. The subject matter – offshoring -- is both politically unpopular and strategically complex; therefore, many industry ‘gurus’ and technologists who are curious don’t want to be seen as ‘interested’ in the topic. Even technology executives who are interested in the topic don’t want to be vocal about it since they probably don’t want to tip off analysts, customers (and competitors) to the fact that they are considering offshoring.

* Ps: For those curious about my experiences in writing the book, check out my ITToolbox blog entry “On writing a book.”  

The intent in authoring the book was simple: I relocated back from the US to India and joined Infosys in 2003, primarily to learn and observe first hand the practice of Offshoring. I just had to see how projects were being sourced to half-way across the globe, executed and (almost) seamlessly delivered back to clients. I wanted to observe and learn since most of the literature on offshore outsourcing and offshoring focused on either the “pros and cons” of sourcing or on the “cost benefits” rather than the nitty-gritty of how offshoring of IT works.

Though it seems seamless to rest of the world, the foot-soldiers: developers, project and delivery managers orchestrate the ‘magic’ of Global Delivery Management [GDM] every day, refining the processes and learning the intricacies along the way.

In this blog, as in my book, I shall be trying to expose readers to some of the key challenges of sourcing. Together we will learn how to avoid the pitfalls that come from managing global IT projects.

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