In many situations, the cost of work onshore is still higher than the cost of work offshore. By complementing onshore work with a nearshore presence, organizations can simultaneously reduce cycle time and cut costs. Though splitting work among multiple locations may create concerns about potential confusion or quality issues, organizations can address this perceived complexity by first considering work streams appropriate for nearshoring. For instance, resource-constrained work like testing and production support – work that only one person can perform at a time and that is serial in nature – is a great candidate. In these cases, work can be performed by one employee or a group and then passed to another group to continue forward progress.
Nearshoring can offer the following Top 5 benefits:
1. Don’t follow the sun, outrun the sun! By having productive personnel spread around the globe, organizations can finish work more quickly and accelerate the underlying return on investment. You will improve productivity, quality and responsiveness by eliminating “graveyard shifts” and using fresh resources during normal working hours. Work that requires 24x7x365 coverage benefits from this model.
2. Reduce costs and increase support. Nearshore personnel represent an economical way to increase support availability when contact requirements are high, especially in situations that require teleconferencing or online collaboration tools. In fact, support from the same or near time zone is usually a requirement for unstable applications that must be fixed during normal working hours. Business functions that do not yet leverage an offshore model may also initially require only nearshore support.
3. Reduce the risk. The ability to share application knowledge across multiple sites lessens geo-political risks. As multiple areas are able to respond to emergency situations, technology and other hardware failure risks diminish. And as complete in-country failure scenarios become less severe, disaster recovery capabilities improve across many levels.
4. Dive into the talent pool. Specific technology and business skills are sometimes only available nearshore. In fact, a nearshore presence can address availability and scalability issues that an offshore presence sometimes presents.
5. Talk the talk. While English remains a challenge in some offshore centers, nearshore centers increasingly offer language expertise, including bilingual capabilities. With the changing landscape of global workforces, bilingual capabilities are becoming more than a “nice-to-have.”
ISG can help you design the optimal on-, off- and nearshore arrangement to lower costs, reduce cycle times and mitigate risks in the outsourcing world. Contact Jon Butler to discuss the benefits of nearshoring.About the author
Mr. Butler is a knowledgeable Operations, Outsourcing and Right-shoring professional who brings 30 years of information technology (IT) experience to ISG’s clients in his role as Principal Consultant. Jon is an accomplished expert in the evaluation of complex global sourcing alternatives, and his expertise spans all aspects of IT. Jon’s clients benefit from his long-term, hands-on experience in sourcing service delivery, where Jon has done everything from running a successful multi-disciplinary PMO for a service provider's 1500+ member team, to relocating to create a new Latin American delivery center that worked in concert with India to improve delivery and reduce client costs.