Offshore Outsourcing Vendor Services

One of the questions most often asked by vendors concerns how the European Centre for Offshore Development selects the offshore outsourcing vendors it recommends.

Apart from reviewing technical capabilities, previous project experience, financial stability and taking up references, we also, among other things, look at the supplier's location and the number of staff. A huge number of resources isn't necessarily a good thing, some of our customers prefer the flexibility and responsiveness of a leaner organisation. Also some specialist skills are only available from smaller vendors. We also maintain our own additional vendor assessment information which we use when selecting vendors for customers. The criteria we use includes: satisfactory delivery of services and projects, responsiveness, proven technical ability and clarity of communication.

As to the actual selection process. We have three key selection models, and the choice of the most appropriate depends on how the customer wants to be involved - if at all - in the selection process. The models are:

• Single Vendor
• Short List
• Full Review and Short List.

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Model 2 - Short List

We adopt the short list model when a customer requests that we provide them with a small number of potential offshore partners to choose from.

We work with the customer to perform an initial requirements analysis and develop a Requirement Definition Document. From this we develop a Vendor Requirement Profile and we use this as the basis of a search of our vendor database. Matching vendors are assessed against the profile and put on an Initial Vendor List. We try to keep this list quite short, typically only five vendors are selected at this stage.

Having made our initial selection, we hold an initial vendor review with the customer, aiming to reduce the short list to a maximum of three potential offshore vendors. If necessary we refine the Vendor Requirement Profile and repeat the selection process.

The next steps depend on the type of commitment the customer is entering into, though we advise customers to start with a small pilot, sometimes this is not possible, and more 'due diligence' is required.

For a short or medium term software application development projects, the selected Vendors will be given a project brief, which eCODE produces for the customer from the requirements analysis and Requirements Definition Document.

Finally, we will review proposals and presentations from the short listed vendors. The European Centre for Offshore Development normally undertakes to review draft proposals for vendors to keep to a minimum any issues or questions the customer may have. We also point out any areas of weakness that we identify, so that the supplier has an opportunity to strengthen their proposition. This ensures that any misunderstandings are resolved before the customer reviews the submissions, and cuts down on the time the customer needs to review the proposals.

The completed proposals are reviewed by the European Centre for Offshore Development and the customer and a final selection is made.

For longer term partnerships, Business Process Outsourcing and for establishing Offshore Development Centres, as well as reviewing proposals and presentations we will help the customer with accompanied site visits to the prospective vendors' facilities. Our extensive experience guides the customer through visa applications, international travel arrangements, provides cultural awareness, and assists with the sometimes challenging process of meeting and reviewing vendors. Our expertise in offshore outsourcing and any previous experience of working with the vendor is used to ensure that the customer gets a fair and balanced view of the vendor's potential as a long term business partner. We also use our knowledge of the countries concerned to ensure that local travel arrangements, accommodation and the customers' dietary requirements are met.

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Model 3 - Full Review and Short List

The final selection model we use is similar to the short list model above, except instead of inviting a small number of suppliers to bid for the customer's business, an initial briefing document is sent out to all the suppliers in our vendor database that match the Vendor Requirement Definition. From the responses to this briefing document a short list of five or so vendors is made, and these are requested to bid for the contract.

This model requires a lot more work to set-up, and the larger number of vendors means that eCODE has to put in a lot more effort dealing with queries and sifting responses, the increased work-load (and therefore cost) has resulted in fewer customers adopting this model.

Benefits

All our vendor selection models have one thing in common, they benefit both the vendor and the customer by saving them unnecessary effort:

• Customers for offshore outsourcing are confronted with a staggering number of potential vendors to chose from, and then need to obtain the expertise necessary to make the correct selection and negotiate a suitable contract. Possibly with a supplier headquartered five thousand or more miles away. Fully comprehending what is available and how it compares to offerings from other suppliers or countries is impossible with out a large investment of time and money and unescorted visits to new destinations and new cultures can be a massive challenge.
  
  Our vendor selection models vastly reduces the amount of effort required by the customer, and at the same time provides a higher quality selection process than they could reasonably achieve on their own
• Vendors face countless unsuccessful sales calls and pitches before finding a prospect prepared to talk to them, let alone accept a bid for an outsourcing contract. They also face the expense of establishing and maintaining sales offices, and funding frequent international travel for key staff.
  
  Our customer contacts, and knowledge of UK and European markets ensures that vendors put their proposition to qualified customers with real needs. We will have invested months, and sometimes years of pre-sales activity, finding, qualifying and encouraging the customers you are asked to submit proposals to.

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