The document provides guidance on successfully offshoring software development through establishing trust and transparency between onshore and offshore teams. It emphasizes that software development is a people-centric business that requires aligning teams' knowledge and ambitions. Specifically, it recommends overcoming barriers like "not-invented-here" thinking and establishing trust from the beginning through honesty and transparency. It also advises treating the process of setting up an offshore team as an exciting opportunity rather than a problem to be solved.

1. The Ultimate Guide to
Quality Software
through
Offshoring

2. Preface
Several factors come into play when deciding on offshoring software development. While
weighing the offshoring options you may wish to know how this would fit in your business
strategy. You may be interested in finding out what the impact on quality and ROI would be,
how it would be implemented and if there would be any issues related to people, processes
and projects.
At coMakeIT, we believe in making offshoring a successful and easily achievable goal for
ISVs. In this book, we’ve outlined the best practices of offshoring that we’ve learned from over
fifteen years of working directly with ISVs across the globe. The ideas and strategies offered
in the book are based on our experience and expertise in partnering with different ISVs in
realizing their business goals. We encourage you to explore and implement them
appropriately. You may wish to reach us if you are looking out for a partner in your offshoring
engagement.
We assure you resounding success.
Steven ten Napel
CEO
Kiran Madhunapantula
COO
2

3. Introduction
Balanced sourcing
Contents
Culture doesn’t matter.
Good processes do.
Cheap is expensive?
Shuttle diplomacy
Copyright is never a right to copy
Keeping it right
3

4. Offshoring is, at the core, a practice that involves moving a part or all of a
company’s processes to a foreign country for a plethora of reasons ranging
from lowering costs to increasing efficiency. It has been an immensely
effective go-to solution for ISVs at various stages of growth:
ISVs that have a well running R&D department, but need to expand
capacity
Introduction
Quality Software
Through Offshoring
ISVs that want to migrate to new technology, but do not have the
resources to actually do it
ISVs that want to innovate, but do not have the right people or can't get
them locally
Not surprising then, that over 80% of the world largest software vendors are
already offshoring!
4

5. r
ente
Offs
lop
eve
D
hore
tC
men
hore
Own offs
Outsourced Produc
t
Development Serv
ices
Outsourced software
Service Providers
Owing to the highly competitive nature of the market we thrive in, there
is an inherent need to seek out new ways to increase productivity and
efficiency. It should also be noted that the success and failure of a model
doesn’t depend entirely on the model itself but also, and more importantly, on
its implementation. Let’s consider commonly engaged models in the
software offshoring and outsourcing industry.
Introduction
Whenever an organisation is looking to outsource or go offshore, various
questions arise. These are centered around where to start and which
engagement model to follow. Most of these questions originate from either
the fear-of-the-unknown or case studies of successes and failures in
offshoring or outsourcing endeavors.
The choice of a model usually is a balance
between customer intended sphere of
control and vendor-offered flexibility.
5

6. Introduction
High
Own offshore
Offshore
development center
Outsourced
product development
Sphere of control
To truly succeed in your offshoring initiative,
ensure that your choice of an engagement model
is based on strategic intent. As mentioned earlier,
certain basic questions and concerns still bother
decision makers when embracing an offshoring
or outsourcing strategy. Here is an attempt to
demystify some of the popular concerns in a very
practical and unbiased manner.
Offshore
Services providers
Low
High
Flexibility in engagement
6

7. Balanced
Sourcing
Culture doesn’t matter.
Good processes do
Solving a problem within the mindset that created it can be difficult. However, in outsourcing, assuming
that others will solve what you can’t can be a difficult proposition. Look for competency compatibility
in your partner so that you can focus on your strengths while allowing your partner to do what they do
best.
A different culture is not a difficult culture. Focus on competency compatibility rather than cultural
compatibility so that time and energy is well spent focusing on things that yield substantial business
benefits.
Cheap is
expensive ?
A common perception is that since you get several rupees for a Euro, you can buy more. But, when the
result of this investment is that you spend more Euros to repair your product, the cost advantage quickly
disappears. Hence, you need to set the right quality and invest accordingly and cost savings will be a
positive outcome from it.
Shuttle
Diplomacy
Software development is a people and knowledge-centric business. The process of setting up and
operating a distributed innovation involves aligning people, their knowledge and the overall business
ambition of the company.
Copyright
is never a
right to copy
It is crucial to have shared values and principles when it comes to respecting each other’s intellectual
property. Choosing an outsourcing or offshoring partner should be a very meticulous and well thought
out decision because it is much more than just a regular transaction.
Keeping
it right
When pursuing offshoring or outsourcing endeavors, it is crucial to make decisions based on context.
Determine with certainty your reason for offshoring the software development process. While there is
always going to be an uncertainty factor, contextual decision-making in offshoring will help drive better
results.
7

8. Balanced
Sourcing
Solving a problem within the mindset
that created it can be difficult.
However, in outsourcing, assuming
that others will solve what you can’t
can be a difficult proposition. Look
for competency compatibility in your
partner so that you can focus on your
strengths while allowing your partner
to do what they do best.

9. Yet another common element in the traditional outsourcing thought leadership
was to outsource those processes that posed execution challenges. While
there is nothing inherently wrong or right about a certain strategy, timing does
impact its effectiveness.
Before one can make a call as to which strategy to adopt, it is crucial to
identify its alignment with broader business goals. Getting the team set up
based on your requirements and needs can be a time-intensive process and
hence it has to have a direct link with your business strategy.
Insourcing offers a brilliant
opportunity for the customer
to amplify existing business.
Balanced Sourcing
Traditional strategies of offshoring and outsourcing were dominated mainly by
financial leverage which meant they were focused on high volume and low
cost.
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6z

10. That brings the discussion to what should drive the decision on which model
to choose. Well, while there is no particular size that fits all, there are
however some guiding principles that can help steer the decision making
process.
It’s all about striking the right balance between the following factors:
Balanced Sourcing
A popular strategy is to go the insourcing route, thereby augmenting the
existing process rather than choosing to outsource by giving a part of the
process away. Insourcing offers a brilliant opportunity for the customers to
amplify existing business through their choice of skilled resources and as
much degree of supervision and participation as they see fit. It also makes
available additional customer-friendly features resulting in high quality
products and long-term engagements, while simultaneously also raking in
with it all the attractive benefits of outsourcing.
Control
Determining how much control your company is willing to transfer and how
much it wants to retain
Competency
Focus on core competency and partnering for ancillary competencies
10

11. to Order
Execute
to Order
Staff
augmentation
Traditional
Outsourcing
Project
Outsourcing
Business
Extension
Flexibility
Low
High
Customer
Partner
Model Businesses
Determining the risk appetite of your company in terms of not just investing
money but also investing management attention and the governance
mechanism
Outsourcing problems
Finally, the most important balance is having clarity on whether problems
are being outsourced or opportunities are being insourced. Taking an
analogy from the manufacturing industry, let’s try to put this perspective as
an offshoring decoupling point.
Don’t outsource your problems
Solving a problem within the mindset that created it can be difficult. In
outsourcing, assuming that others will solve what you can’t can be a difficult
proposition. Look for competency compatibility in your partner so that you
can focus on your strengths while allowing your partner to do what they do
best.
Balanced Sourcing
Risk
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12. Culture
A different culture is not a difficult
culture. Focus on competency
compatibility rather than cultural
compatibility so that time and energy
is well spent focusing on things that
yield substantial business benefits.

13. It is said that in India, dialect, culture and food habits change every 100
kilometers. You may find a similar scenario in other countries as well.
First of all, different cultures are not difficult cultures. For reasons of historic
importance, cultures have come into existence independently and almost
involuntarily. Culture can be seen as a super set of accepted norms in a
society/country/region based on various parameters that influence life.
Culture
Culture can be seen as a super set of accepted norms in a society/country
/region based on various parameters that influence life.
So, there is good reason to respect different cultures and not try to dissolve
or deny them for a specific business or a personal relationship.
However, there is still an unresolved issue of how to deal with culture in
different geographies.
Let’s think of a culture neutral scenario. Let’s define culture neutral as a state
that we assume in business or personal relationship, where two parties want
to deal with each other. It’s not a ‘my way or the highway’ thing.
Business is just usual
when you want it to be.
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8

14. Objective
It should at least be clear what is expected of a collaboration involving
different cultures. This can be business expansion, growth, personal relation
or a new business idea. This is the component that will create the basic
‘click’ in the relationship.
Culture
A few basic tips for creating a culture neutral state:
Trust
Easier said than done. There needs to be a basic level of trust between
parties on aspects such as, opportunities, possibilities and willingness. This
keeps things moving forward.
Contract
When beginning a relationship, the understanding should be in a formal
contract, with due legal applicability.
Communication
Language is not a barrier for communication, but an enabler. Finding ways
and means of communicating when needed is an essential step-in
understanding each other.
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15. Seeking lighter moments to share a joke or two is never a bad idea.
We can create a culture neutral state by adopting mutually agreed upon
norms. This can also be described as a new culture that sets the base for a
relationship. Such a state should be able to handle what we
often refer to as ‘business as usual’.
Culture
Fun
Business Behavior
Don’t try to do things that you are not used to. Focus on following common
norms and make use of them for normal and usual business behavior.
Constructive Feedback
Offer and expect objective feedback on process and results instead of being
critical of people’s behavior. Humans can and do adapt.
It’s best to behave in a normal fashion than attempting to do something we
are not used to. Collaboration is beneficial to every member, so there is no
reason to assume or imagine that possessing more power in a relationship
gives an advantage.
15

16. Cheap is
expensive?
A common perception is that since you
get several rupees for a Euro, you can
buy more. But, when the result of this
investment is that you spend more
Euros to repair your product, the cost
advantage quickly disappears. Hence,
you need to set the right quality and
invest accordingly and cost savings
will be a positive outcome from it.
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9
17
00

17. People didn't realize that software engineering was not just slapping together
a few lines of code but a full-fledged profession that involved elements such
as purpose, relevance, fool proofing, future-proofing, fault tolerance and use
that determined its true value. Here are some interesting facts about the
evolution of outsourcing:
The early 90s and later the Y2K era saw a need for additional capacity to cope
with rising demands of automation and an even higher demand for 'fixing'
processes when they went awry.
Emerging nations like India were abounding in qualified young people with
exemplary communication skills and so, became the obvious choice of
destination.
Transaction outsourcing emerged as both time and cost effective, thus
becoming a best practice for all future generations, even after the context of
outsourcing changed. For a few nations that had adopted transaction
outsourcing, this process had set a benchmark of expectations, however low
it was.
Cheap is expensive?
The early days of outsourcing had one common theme: count the number of
'hands' engaged in programming and then search for a place to get it done in
the least expensive way possible.
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8

18. Project outsourcing did not take into consideration the fact that the
outsourcing service providers were not automatically capable of coping with
the constantly changing demands of the customer. Consequently, the end
product often did not match specifications and there would be cost and time
overrun, which lead to tremendous frustration.
In India, however, several companies emerged stronger during this phase by
exceeding customer expectations. Since competitor companies were unable
to catch up, they started playing the price card. Eventually, companies
started to focus solely on cost savings which led to various negative
consequences and offshoring started to get a bad reputation. Most
companies that went east to save ended up spending more to repair than
to produce.
However, India, being the earliest outsourcing destination, had gained a
tremendous amount of experience in software development. The Indian
government, upon realizing this potential, also invested heavily in ICT
education and infrastructure sectors. Indian software companies became
international players and software product companies emerged in the
international market at an enterprise level.
Cheap is expensive?
In the last decade, the offshoring industry matured and gave rise to
‘project outsourcing’. This increased expectations of companies that wanted
to gain time and cost benefits.
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19. Proven capabilities are better than unproven possibilities. It is important
to leverage the experience of people in the partner company, who have
been there and done that.
Software engineering is a profession. This principle needs to be the core
of the partner organisation. Developing software products is a complex
branch of the software engineering profession. Experience and maturity of
the partner is of vital importance here.
Price is an index of experience and outcome. The brand may not just justify
price. Lower price does not mean low quality. In effect, so many rupees for
either a Euro or a Dollar is a measure but not the driver.
17
00
Cost is an important measure in offshoring or outsourcing but it is not the
same as equating with currency exchange rates. Focusing on effectiveness of
the offshoring / outsourcing solution, selection of the right partner and
implementing governance, will produce the right results, and as a
consequence of all these measures, cost efficiency as well.
Cheap is expensive?
While expansion and extension are extremely necessary for companies,
especially in today’s networked economy, it is more important to properly
choose who to partner and work with. There are several distinct parameters of
assessing a partner, almost like testing for a DNA match, that are crucial for
success.
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20. Borders? I have never seen one.
But I've heard they exist in the minds of some people.
Thor Heyerdahl
Shuttle
Diplomacy
Software development is a people and
knowledge centric business. The process
of setting up and operating a distributed
innovation involves aligning people, their
knowledge and the overall business
ambition of the company.

21. It is true, of course, that offshoring brings challenges. These range from new
geography, different time zones, language/dialect/accent issues and so on.
But, it is important to note that this arrangement is no different from
operating out of two different cities in the same country.
Shuttle Diplomacy
Overcoming barriers of mind is critical in offshoring engagements. Often
people get stuck with the perils of traditional thinking such as the
‘not-invented-here’, ‘too-far-from-my-bed’ and ‘us vs. them’ syndromes.
This thinking saps away all the incredible potential offshoring can actually
bring- a combination of top-notch skills and opportunities that can be
gleaned from working with a trusted offshoring partner.
The process of setting up an offshore team
can be exciting. For an entrepreneur, this
can even be great fun!
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8

22. Offshoring endeavours thrive in the atmosphere of trust and transparency.
It is crucial that trust is established mutually and there is no better way to
accomplish this than by being honest and transparent from the very
beginning. Irrespective of your location, when you create a collective
ambition, people will be at their best in contribution.
Shuttle Diplomacy
Software development is a people and knowledge-centric business. The
process of setting up and operating a distributed innovation involves aligning
people, their knowledge and the overall business ambition of the company.
22
8

23. This involved:
Unequal distribution of work: Unfair decisions on who does routine and
mundane work and who gets to work on the cutting-edge aspects of the task
at hand
‘Us vs them’ culture: Passing the buck quickly to the other side and focuing
on "who" rather than "what" in cases of failures
Fire fighting attitude: "Let me jump into the airplane and fix things”
Task management: Lack of percolation of ownership coupled with a very
distant sense of purpose
In order to make teams work in a geographically distributed setup, it is
important to let teams feel each other’s pulse. The best way to achieve this is
by allowing team members from all locations to meet face-to-face once in a
while. Just as a picture says a thousand words, in-person meetings will work
more wonders than a well documented communication process.
Shuttle Diplomacy
In our experience, the alignment from the people perspective precedes all
other elements. In the early days of offshoring, certain practices were
followed, perhaps in relation to time and possibilities, that did not help explore
all the benefits of the offshoring process.
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24. When the teams are in their forming stage, certain management staff and
key team members should be involved in the selection of offshore team
members. This will help improve acceptability amongst members.
Next, we implement what we term as 'shuttle diplomacy' between the
teams. Offshore team members travel during the seeding stage to get
acquainted with their counterparts and engage in a knowledge transfer
process.
When the teams start to perform, some of the senior colleagues should visit
the offshore teams, at least a couple of times in a year, to interact and learn
from each other for improvement.
Executive management must pay close attention to the offshore teams,
otherwise they lose connection with the business and the ambition. A town
hall or an all hands meet, once a year is highly recommended for the chief
executive, during the visit of their offshore teams.
Most importantly, it is worth investing in communication tools for video
conferencing. They are very powerful in strengthening and intensifying the
existing connection.
Shuttle Diplomacy
From a practical stand point, this can be implemented quite easily.
At coMakeIT, we call this process Shuttle Diplomacy. It comprises the
following key stages:
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25. Copyright
is never a
right to copy
It is crucial to have shared values
and principles when it comes to
respecting each other’s intellectual
property. Choosing an outsourcing
or offshoring partner should be a very
meticulous and well thought out
decision because it is much more than
just a regular transaction.

26. This uniqueness deserves a definite right to be protected, before someone
else imitates it, because it is easy once they know how.
When it comes to an idea, the first and foremost rule is being able to prove
that you were the first to conceive, design and develop it.
Intellectual Property (IP) can be thought of as a mapping of inherent
intelligence on to a real world challenge resulting in an explicit form of
knowledge. The real value of IP is in its use, how widely and frequently it is
used and how big the impact is in reality and as a potential. It would be a
shame to lose out on that opportunity through someone's malicious
intentions!
Copyright is never a right to copy
It is said that those who dream of changing the world just might do it
one day. It all starts with an idea that could stem from literally anywhereschools, garages, innovation centers or venture capital world, when you set
out with a mission to change the world's perspective on things. It could be a
process or a product but the common element is always the uniqueness
behind the concept.
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27. Intellectual property protection should be taken seriously. As the common
saying goes, things can be made fool-proof but not idiot-proof. For example,
a casual tweet or a Facebook status can inadvertently expose highly
confidential information. So, it makes it all the more important to be careful
about IP protection.
Software offshoring adds a complex dimension to IP security since it
crosses not just the physical boundary but a legal and jurisdiction boundary
as well. It is natural for ISVs and software product development companies
to have concerns about IP protection when it comes to offshoring their
software development work to other geographies.
Copyright is never a right to copy
For every IP developer, there is much more in the game than just money.
There is also the thrill of accomplishment, an iron will to succeed and an
anxiety about the outcome and a great degree of risk appetite. The last thing
they need to deal with is a sense of insecurity about their IP
.
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28. Product DNA
The partner of choice has to have product DNA. Unless the management and
the promoters have been there and done that, they wouldn’t know the value of
your IP A majority of offshoring choices fail drastically in this area because
.
although they get a team in place, there is a lack of proper understanding and
agreements in place.
Trust and transparency are vital in any offshoring engagement. Your
organisation must always ensure that these two core elements are in place
when deciding to engage with an offshore partner. At coMakeIT, we firmly
believe that transparency is the breeding ground for trust.
Laws of the land
Laws of the land play a very crucial role in the whole process of choosing the
location for offshoring. Applicability of international laws around intellectually
property must be in the system. Partnership with WIPO (World Intellectual
property organisation), IPR based education and research, demonstrates the
country’s commitment to complying with global treaties and agreements.
Copyright is never a right to copy
For an ISV, there are a few strategies to overcome the fear of the unknown in
offshoring their software product development abroad.
28

29. In the end, a law or a treaty is merely a deterrent. The attitude of respecting
each other's IP shows in the business atmosphere. An infringement can, of
course, be contested in the court of law. But the business attitude of never
having to test the laws is the essence of a true partnership. The number of
law suits on IP rights can never be the measure as to how strict the
enforcement is. So, it is important to choose the partner based on their track
record. Because, if they don't have it inside, they can't have it outside.
Contracts
Having a number of contracts can be helpful in ensuring that the IP is
in safe hands. It is most important to have in place a Non-Disclosure
Agreement (NDA) protected under the laws applicable in both countries
Another NDA between the partner company and the employee in the
engagement will further strengthen the agreements from either intentional or
unintentional leakages from the employees of the partner's company.
Choosing an outsourcing or offshoring partner should be a very meticulous
and well thought out decision because it is much more than just a regular
transaction. The best plan of action is to ensure that you and the offshoring
company have shared values and principles when it comes to respecting
each other’s intellectual property.
Copyright is never a right to copy
Track record
29

30. Keeping
it right
When pursuing offshoring or outsourcing
endeavors, it is crucial to make
decisions based on context. Determine
with certainty your reason for offshoring
the software development process. While
there is always going to be an uncertainty
factor, contextual decision-making in
offshoring will help drive better results.

31. Your decision-making process should take two key components into
consideration: context and the uncertainty factor.
Let's consider an example here. You are about to go on a holiday to a country
you've never been before. You are considering hiring a tour guide to ensure that
you hit all the right spots. When making this hiring decision, you would consider the context because your interests may vary from wanting to visit museums and historical sites to beaches or perhaps, you want to go trekking on the
mountains. Your choice of a tour guide would depend on both his/her expertise
and whether or not it aligns with your own interests.
This logic also applies to software offshoring. Decision-making has to be
extremely contextual because while there is going to be a certain level of
uncertainty; you can ensure that your decision will drive results by
implementing it in the right context.
Keeping it right
When offshoring, there are three factors that you have to get right:
the right process and the right partner and within the right business context.
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32. Your context for offshoring is also determined by factors such as a lack of
talent in-house, difficulties in hiring the right talent, time to market necessity,
growth of the company or achieving the same results (or more) with less time
and effort. The context is also going to vary for a services based organisation
as opposed to an organisation that is focusing on developing and selling
software products. It is crucial for a company to have the context defined and
shared with the partner to be able to establish a perfect working relationship.
Keeping it right
If your company is looking to rapidly increase headcount to meet time-tomarket demands, your solution would be different from if you were looking for
break-through innovation in a certain business area. Applying the same
solution in different contexts does not necessarily produce the same results.
32

33. Right partner
As an innovative ISV, your company would have expertise in a business or
technology area that is so distinct that others may not fully know about it.
This is where your guidance and mentoring would add immense value to
your partner's productivity and efficiency. As you help them understand your
business better, they can bring you closer to your goals.
Often quantity is confused with quality. It is not about how many people are
available who can perform a particular aspect of work; rather it is about how
many people there are that are already doing the work. Numbers can be
deceptive. It isn’t just about the knowledge anymore, it is about application.
The true spirit of partnership can be experienced when both parties are
willing to stick their neck out and go out of their way to make the endeavor
successful. This go-getter spirit goes beyond mere purchase orders and
invoices.
Keeping it right
When pursuing offshoring endeavors, focus on the following basic
principles:
The most effective indicators of how successful your partnership will be are:
Capability of the partner in the eyes of his or her existing relations
Past experience and maturity of the leadership team
How the partner conducts his or her business
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34. Establishing a governance mechanism is a very important step in the
offshoring process. Organisations often mistake the governance to be
progress reporting. While progress reporting is part of a project, governance
has a wider jurisdiction over the contract and relationship.
In order for a relationship to yield right results, a formal governance structure
and process will be of great help. Here is an indication of how such a
structure and process could be setup
Ensure the purpose is met: people expect information to be shared and
decisions to be made in a governance process!
Executives from both sides, who hold accountability for the results of the
partnership should be part of the governance board
Identify a few critical milestones and goals of the partnership that must
be met; make those goals agenda items for the governance process
Identify key elements in the contract and ensure that there is an emphasis
on them; this will help prevent surprises (often what’s written in the
contract is forgotten until an issue surfaces)
Establish the frequency of the meeting; most ideal is once-a-month and
a willingness to meet about an escalation within one-day notice
Plan to meet in person at least once or twice a year
There may be several companies and people who claim the know-how, but
as a company, if you want to ensure that your results are a resounding
success, look for do-how people!
Keeping it right
Steering mechanism
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35. Conclusion
In this book, we’ve seen that quality software through offshoring has the power to transform
your business model in ways you have never imagined before.
We believe that true globalization is only possible with business networks organised as
long-term partnerships. We believe in the power of business ecosystems that are built with
relationships that run deeper than the bottom line results.
This is why we do offshoring differently. We really coMakeIT together.
We have pioneered the concept of distributed innovation by helping companies set up high
quality development teams to extend and scale up their R&D pursuits. India has a fantastic
pool of highly qualified and bright software developers, from which we recruit, retain and
develop your extended team, ensuring that you achieve better results with less effort. As a
preferred partner for specialised software offshoring, we have always emphasised on
building long-term relationships with ISVs in their growth and sourcing strategies.
We are backed with over 15 years of experience in developing quality software that is built to
last. At coMakeIT, we are entirely committed to making software offshoring easy and
achievable to every ISV in the world.
www.comakeit.com
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