Off Shoring

To Off-Shore or Not Off-Shore. Is that the Question?

Banks are under greater pressure to deliver cost-effective business and IT payments solutions. On the one hand domestic and international regulations are exerting a raft of compliance demands, and on the other new market entrants such as Google Checkout and PayPal are raising customer expectations for more innovative payment offerings.

With reduced budgets IT departments have looked for ways to enable them to 'do more, for less':

  • Adopt better delivery processes to smooth the flow from requirements through to delivery.
  • Use productivity improvement development tools (e.g. Integration tools, BPM tools ).
  • Use cheaper resources - i.e. off-shore.

Of these, the success or otherwise of off-shoring has polarised opinion across the industry and, indeed, within management tiers inside organisations.

Certainly the risks of off-shoring are well documented and include poor two-way communication, high turn-over of key skills and unrealistic expectations of productivity. But often the perceived failings of off-shore are a result of poor processes or the introduction of technologies without consideration for the skills needed to adopt them.

That being the case, the debate is not a binary choice of whether to off-shore or not - the cost savings of doing so are too great to ignore. Instead the challenge is about how you de-risk the off-shore involvement in a project, many customers are concluding that this requires a blended resource model, with:

  • Off-shored resources being used where attrition does not put the project at risk and where strong inter-communication is not required
  • On-shore resources being used for the roles demanding stable SME knowledge, deep technical knowledge, strong communication skills and/or strong implementation of process and governance.

Given Icon's established reputation for performing these high calibre roles, we have increasingly been asked to fulfil these roles on projects which are primarily being delivered by off-shore resources, giving the customer assured delivery at the best price.

Through the experience we have gained on these engagements, we have established clear processes and governance principles to optimise the collective efforts of the extended on-shore / off-shore team. While no two engagements are identical, they generally fall into one of two categories:

Direct management
In this model, Icon agrees to deliver set capabilities and/or deliverables to the end - customer, and we openly make use of off-shore resources to make good on those commitments. This means Icon takes on the risk of non-delivery and the management overhead of those resources. This model works well for the customer because we will already be providing on-shore analysis, architecture, SME and PM skills.
Indirect management
In this model both Icon and any off-shore suppliers will engage separately with the client. Our role is to provide a governance and oversight layer - both from a delivery quality point of view (potentially including code and documentation reviews) and also from an architectural point of view. We often retain the TDA (technical design authority) role within our customers - and in that role any work done by other suppliers will be analysed and reviewed by an Icon BA or architect to ensure it fits with both the strategic aims of the project or platform and the quality requirements.


Of course, either of these models can only work successfully in the absence of conflicts of interests and hidden agendas. Icon's business strategy is to directly provide only on the high-calibre roles, injecting the capability which off-shore providers struggle to attract and retain. And unlike many on-shore providers of these skills, we have no fixed off-shore allegiances so are not perceived as a threat to existing off-shore vendors.

Contact us to see how we can help your extended team work in harmony towards a common goal.

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