For Larry Loh, CIO of Analog Devices, successful IT offshoring is all about making a long-term commitment. About four years ago, Analog Devices found itself bottlenecked in its technology services group, unable to load new OSes and configure new services fast enough to meet internal demand.
So the maker of signal-processing semiconductors turned to Bangalore, India-based Infosys Technologies for staff augmentation in technology services, a relationship that has expanded to include SAP support and Web-based development. Although he was pressed for time, Loh recalls making sure his company did a thorough job of vetting competing offshore vendors. “It was a long courtship,” he says. “It took us almost a year of trying to decide whether they were a better fit.”
When it comes to offshoring, Loh’s believes a long-term commitment pays off in spades. “This is not one of those initiatives you can take lightly,” he advises. “You need to decide what it is that you want to accomplish and commit to that long term. You won’t really get the gains of scale, flexibility, and technology until you’re deep into a mutually trusting relationship.”
Loh’s team worked closely with Infosys to create formal handoff processes to ensure that when everyday issues crop up they are handled in the right manner. “These can either become a finger-pointing spiral or lead to something much more collaborative,” he says.
In addition to the formal process focus, Loh recommends building personal relationships at different levels of connection -- from the CEO on down to the project teams -- to help the vendor understand “our business, our challenges, and our annoyances.”
Although he believes contract language is important, Loh prefers to focus on the relationship as his best guarantee of getting high-quality work from a region of India that “is growing like mad” and possibly overcommitted. “Our measures of success are not going to be determined by legalese but by our complete, mutual understanding that this is a long-term relationship,” he says. “We want people who are productive -- and projects delivered on time and on budget.”
To get the most value from an offshoring venture, Loh emphasizes the importance of sweating the daily details, even when it seems the long-term relationship is going well. “It’s not something you can just put aside and expect it to keep running well,” he says. “It takes a lot of care and feeding to refine the processes, keep everything on track, and make incremental improvements.”