Wonderlabs Blog

Software Development - Outsource, Offshore, Offsite?

Posted by Keith Tan on Aug 17, 2017 5:01:23 PM

business-customer-care-service_1325-159.jpg

Both Offshoring and Outsourcing relies on the theory that mandates a business focuses on its core business and devolve other non-core business functions. Devolution of non-core business functions often takes the form of an Offshore Development Centre (or ODC) or simply outsourcing services to an external vendor all together. One of the most popular forms of offshoring or outsourcing is in the software development field.

There are several models of offshoring or outsourcing. But the main objective is often to reduce cost. I lay them out below:

 

Onsite Model

  • Onsite Model - The talents or resources or FTE (FTE = full-time employees) are placed on the Client's premises, on shore. The talents or resources are brought in under work visas into the on shore country. The project scope is not clearly defined, or a project is open-ended and iterative in nature. The services provided by the talents, or resources or FTEs include project requirement capturing, technology assessment, creating functional specifications, designing, coding, testing, maintenance and support. The key point here is that they are hired by an external firm, whose job is to handle all visa, payroll, insurance and benefits. This gives the Client the flexibility of swopping out resources with ease and also terminating contracts where needed. The talents would be repatriated to their home country once the engagement was completed.

 

Offsite Model

  • Offsite Model - The talents or resources or FTE (FTE = full-time employees) are placed at the vendor's premises, but within the same country. [This really differs depending on the country's scale. We here at Wonderlabs have clients in Jakarta, while their teams are offsite in our campuses in Jogjakarta or Bandung, which are an hour or two plane ride away]. No visas or work permits are required for the talents to be engaged. Similarly, the project scope is not clearly defined, or a project is open-ended and iterative in nature. The services provided by the talents, or resources or FTEs include project requirement capturing, technology assessment, creating functional specifications, designing, coding, testing, maintenance and support. The key point here, similar to the Onsite Model, is that the talents/resources/FTEs are hired by an external firm, whose job is to handle all visa, payroll, insurance and benefits. This gives the Client the flexibility of swopping out resources with ease and also terminating contracts where needed. Cost of an offsite model is usually lower than an onsite model because the talents would not need to be repatriated to their home country once the engagement is complete.

 

Offshore Model

  • Offshore Model - The service provider is located in a different country than that of a client. Clients retain full ownership of all intellectual property rights and software source code throughout the engagement. Other than these points, the Offshore Model is similar to the Offsite Model.

The unique thing about the Wonderlabs Model is that we have blended all of the above models.

New Call-to-action

 

images sources: Freepik

Topics: Insider