Partial offshore model

Taking advantage of cost effective offshore software and web development engagements is not just for large companies anymore. The key to successful projects is not completely giving up control. Basically, the best approach is to hire a company which has core architects and project managers in the United States and developers offshore. It is important to have the overall architecture and project management efforts driven locally, while tedious and time-consuming development effort is performed by less expensive offshore developers.

The architect and project manager must be able to meet with the client face-to-face on a regular basis, more in the initial stages and less frequently during development. The system has to be designed in such a way that any average developer can develop the modules assigned to him/her without thinking about the structure of the system, plumbing, performance and scalability. This also provides an opportunity to hire developers from different locations, and not necessarily from the same company.

For example, let's imagine a project that requires 2 months of architecture and design effort by a local architect, followed by 1 month of project planning and team building. The actual development effort can be 6 months with 8 offshore developers. One month of testing and the production roll out. This amounts to a project duration of 10 months with 9 full time and 1 part time resource. Sounds like a big expensive project, right? Well it's big alright, but it doesn't have to be expensive.

Let's compare 2 approaches:

Approach 1: Hiring local company for the whole project:

• 1 Architect at $100/hr - total for 2 months is ~35k
• 1 Project Manager at $100/hr - total for the project is ~140k
• 8 Developers at $75/hr each - total for the project is ~910k

This amounts to a total project cost of $1085k - Ouch!!!

Approach 2: Partial offshore model:

• 1 Architect at $100/hr - total for 2 months is ~35k
• 1 Project Manager at $100/hr - total for the project is ~140k
• 8 Developers at $30/hr each - total for the project is ~365k

This amounts to a total project cost of $540k

I am sure business owners can find good use for the $545k they would save. The actual rates might be different but the overall picture stays the same.

The logical question would be why not hire an architect and project manager offshore as well. A simple answer is lack of face-to-face communication, lack of business knowledge and language barrier will cause project delays of several months, which in turn make it a more expensive effort then the partial offshore engagement.