Onshore? Nearshore? Offshore? How about Best Shore?

Posted on Aug 13, 2020 8:56 AM by:

An executive who was struggling with budget constraints and a sales drought came to us for help. His development team was expensive and inefficient. He didn't need constant development throughput but he had to ensure his team was positioned to respond quickly should a strategic client have a feature request that needed quick release. He couldn't justify the costs of his development team but he also couldn't afford for any clients to jump to a competitor who was more responsive.

In another situation, a different executive came to us who had a serious development bottleneck problem. His small local development team was stuck in "react mode." They only had time to put out fires and deal with urgent client requests. The business, which depended on his development team, was frustrated by the unpredictable development throughput - no one knew when or if they would finally release the strategic features that had been on the roadmap for months.

Both leaders came to us wondering whether offshore offered the solution to their unique situations. In the first case, the executive thought using stereotypically "less expensive offshore" development would help with his challenges. In the second case, the executive thought offshore would give him the ability to quickly hyper-scale his team size. We worked closely with each of them to assess several factors and introduced them to the concept of "Best Shore."

The terms onshore, nearshore, and offshore describe the geographic location of your development team in relation to business stakeholders. The terms carry with them a host of implications and preconceived notions, depending on who you ask and what their experience has been. At Intellinet, we prefer to view onshore, nearshore, and offshore as a spectrum. The ideal model for a business could lie anywhere on that spectrum. Based on a combination of factors which includes a business' needs and strategic intent, we help identify the optimal delivery model that is most likely to achieve their goals within their constraints. The optimal delivery model is what we call Best Shore. In other words, our goal is to help clients use the Best Shore for their specific situation.

Some of the factors we use to determine Best Shore are:

Requirements Clarity

• Any development initiative can become very inefficient when requirements are ambiguous or undefined. This can be exacerbated in offshore due to time zone lag. Consider that each blocking question can create a minimum 24-hour delay. When you have a team offshore waiting on an answer your budget is not going to last long no matter how big it is. Offshore works best when there are minimal questions back and forth.
  
  

Development Backlog Size and Timeline

• We have found offshore works well when you have a large backlog with a long overall timeline. Getting any development team to optimal velocity takes time. Most of the expensive design, architectural patterns, and knowledge acquisition will happen up front, even on an Agile project. Mobilizing an offshore team to the point of optimal efficiency requires time and effort as well. You could consider it an upfront investment to be amortized over the long term. With a small backlog you may not be able to recoup that upfront investment and going with a leaner, more expensive, but "temporary" local team may be more prudent.
  
  

Resource Scarcity

• This one is simple. If you are unable to find knowledgeable workers locally - for either bleeding edge/advanced, mainstream, or legacy technology - you may be forced to look more broadly.
  
  

Need for High-Touch Roles

• We have found it essential to have local proxies who can work directly with the business to gather the requirements and facilitate human-centric design sessions. The need for high touch resources within the local time zone negates the use of offshore resources for these roles. However, if you have an established offshore team with leadership who knows your business intimately, local proxies may not be needed as much.
  
  

Budget

• People often pursue offshore in an effort to produce more value within their budget. They assume they are getting more output while paying for a lower cost of living. However, in order to successfully deliver using offshore, you should account for front-end costs, management, and process oversight. You may need a local presence to work closely with your business to define the solution. In our experience, offshore works most efficiently when we have a local proxy to aid in communication. The costs around these roles and activities can be mitigated if the project has scale or a long timeline.

Back to the two executives. We helped both find their Best Shore solution. In the first case, the executive determined that maintaining a local team sizable enough to handle client requests but only when they arose, was not a viable financial option. However, it also was not practical to ramp an offshore team up and down on the whim of unpredictable client requests - risking losing valuable knowledge and team consistency during ramp down periods when team members go to work on other initiatives. We helped him determine he could leverage a consistent team in an offshore model. While the team would not be fully utilized at times, their excess capacity would be used to innovate and push the business forward, while staying within his financial constraints.

In the other case, the executive used an offshore team and increased the size of his local team. The new onshore team members acted as local liaisons to offshore which helped facilitate requirements passing, architectural oversight, and business acceptance testing. Going "only offshore" was not an option because his existing team was not large enough to handle their existing responsibilities as well as bring the offshore team up to speed or answer their questions. His high skilled local team was able to tackle the experimental, technically complex, or ambiguous features and pass clearer tasks to offshore.

As you can see, there are lots of options on the Best Shore spectrum. What is the Best Shore to achieve your goals?