What is the Best Onshore/Offshore Ratio for Consulting Firms?

At the time of a new engagement, managers take into consideration many activities like project planning, effort estimation, defining goals and metrics, cost, outcome, etc. One factor that is most important for any project to succeed is engaging the right onshore/offshore staffing ratio to execute the project. This factor is mostly not given adequate importance in many recent delivery models. For managers to meet project profit margins, they try to limit the cost spent on project resources and execution. With the limited resourcing budget, it is not feasible to have a default onshore/offshore ratio that fits all projects.

After gathering some experience in working offshore (2007-2008 in Bangalore, India) and onshore (in Germany and Switzerland) I started to wonder if there is a optimal onshore/offshore ratio. Quite soon I concluded that this question is not easy to answer. So I did a breakdown to certain aspects and instead of answering them by myself, I set up a survey and hope to get your support!

Start the survey: http://bit.ly/offshoreratio

Basically, I’d like to address three groups to answer this survey:

  • Employees of traditional consulting firms
  • Employees of Indian pure players (such as Infosys, TCS, HCL, Wipro, etc.)
  • Employees of clients of consulting firms

Of course, I’m going to share the results after evaluation. Thank you for participating and sharing the link with your colleagues…

India still the Top Destination for Outsourcing

SAP Labs India Pvt. Ltd. in Bangalore

Asian countries, especially countries in South Asia and Southeast Asia, keep on being favored picks among organizations interested in contract out business processes offshore. India remains the top outsourcing destination, with its unrivaled advantages in scale and people skills, said the 2014 Global Services Location Index (GSLI) released by A.T. Kearney. China and Malaysia are second and third respectively.

The GSLI, which tracks offshoring patterns to lower-cost developing countries and the ascent of new locations, measures the underlying fundamentals of 51 nations focused on measurements in three general classifications, such as financial attractiveness, people skills and availability, and business environment.

Distributed since 2004 the GSLI, revealed that leading IT-services companies in India, to whom IT-related functions were outsourced, are extending their traditional offerings to incorporate research and development, product development and other niche services. The line between IT and business-procedure outsourcing there is obscuring, as players offer packages and specialized services to their customers and are developing skills in niche domains.

Furthermore, the GSLI identified a trend of multinationals reassessing their outsourcing strategies, after having aggressively outsourced back office operations in the mid-2000s; it has been noted that some companies are starting to reclaim some of these functions and undertaking them in-house again.

Discovering Beijing: The Forbidden City

The Forbidden City

Imagine we were just electrified in Tokyo, not tired at all hopping back to Beijing where we continued our trip. After passing through the chaos of the airport taxi rank, we decided to take the metro. Finally, after wandering around a few alleyways and asking a few times we ran into an old Chinese man who pointed us in the right direction and we finally checked into the Inner Mongolia Grand Hotel Beijing.

Smog covering Beijing

The first thing that comes to mind about Beijing is the smog in the air and the smell of exhaust fumes. It was very evident that the air here is not very clean even at night. Last time I experienced such air polution was 2007 in Bangalore, India. You hear a lot about it but you have to breathe it to fully comprehend how thick it actually is.

The Forbidden CityThe Forbidden City was the first site that we visited in Beijing. Off limits for 500 years, the Forbidden City in the heart of Beijing was finally opened to the masses in 1949. This is a huge complex and China’s most spectacular architectural structure. The Forbidden City was home to 24 emperors in two dynasties, the Ming and the Qing.

The three main halls of the outer court, Hall of Supreme Harmony, Hall of Central Harmony and Hall of Preserved Harmony form a line inside the gate. These halls are all situated on three-tier marble terraces, with ornate marble balustrades. An impressive stone ramp carved with coiled dragons and clouds is located between the steps leading up to each hall. The ramp of Hall of Preserved Harmony is the largest.

The Forbidden City is an amazing walk around that took us one day. We continued with …

“The journey of a thousand miles begins with one step.” – Lao Tzu

Entering Shibuya

Shibuya Crossing, Tokyo, Japan

Multicolored neon light that illuminates a major city center with a vibrant nighttime glow, businessmen cackling, Japanese girls in bright outfits: welcome to Shibuya on a Friday night!

Before going to Japan when I thought of Tokyo I thought of the Shibuya crossing which is pretty famous for being one of the world’s most heavily used pedestrian scramble intersections. I have seen so many photos of this spot and it was one of the places I truly wanted to visit.

We ended up in Shibuya a couple times over our trip but the photo in this post is from the very first visit. While the Shibuya crossing does have “pedestrian crossing lines” which cross in different direction it does seem like people will charge in more or less any direction, as you can see in this video that was taken a few days later.

Electrified in Tokyo

Tokyo

After visiting more than half a dozen Asian countries (including six months in India), I left on my staggering excursion to Japan in June of 2014. I felt the little hairs on my arms standing up as I boarded the Airbus A330-200 at Frankfurt Airport, waves of excitement running up and down my spine, knowing I would end up on the other side of the world, in Tokyo.

After the seventeen-hour journey (via Beijing), and a loud bang, I awoke to a hazy, electric glow, which was almost too much to bear in my awfully jet lagged state. Tokyo glows.

Rainbow Bridge in Tokyo Bay, Japan

Tokyo is perhaps the most gorgeous ugly city in the world. It’s a super-dense riot of mismatched buildings, overhead wiring and one of the planet’s best mass transit systems. In other words: Blade Runner city.

It’s like being surrounded by embers from a fire on speed at nighttime. There’s lights, such a large number of lights, all different colored sparkling lights reflecting all around, and people, so many people, and sounds, sounds that don’t stop.

After deciding I needed out after some days in Tokyo, I headed to Hakone for a respite from the Shibuya crossing