The Offshore BPM Experiment is Over

  • June 7, 2013
  • Scott

Bosch has a really interesting BPM-meets-Internet-of-things offering that quite a few analysts and BPM thought leaders are excited about.

But there are a couple of troubling signs, as viewed from the bleachers… such as  announcements like the one Bosch just made, about a global partnership with an offshore consulting firm:

Bosch Software Innovations, the software and systems division of the Bosch Group, today announced a global strategic business relationship with HCL Technologies. The partnership aims to accelerate delivery of innovative and scalable software solutions and reduce time-to-market across multiple industries with a specific focus on High Technology and Manufacturing sectors. Bosch Software Innovations’ advanced product portfolio and industry expertise along with HCL’s global system integration capabilities will enable the two technology innovators to offer customized solutions and first class experience.

“In today’s fast-paced world, companies must gain a competitive advantage by reducing time-to-market and leveraging innovative software solutions. With HCL’s integration expertise and Bosch’s proven software, we will be able to support our customers in achieving these advantages,” says Klaus Hueftle, managing director at Bosch Software Innovations GmbH.

Vikram Duvvoori, Corporate Vice President and Global Head of Enterprise Transformation Services, HCL Technologies said, “Using Bosch’s tools, we will be able to provide our customers and prospects with solutions that will result in improved productivity and lower net costs.”

Bosch Software Innovations globally works with clients to address their business challenges and to redefine business processes. The company’s core software products for Business Process Management and Business Rules have been globally implemented across multiple industries including Manufacturing, Finance, Healthcare, Insurance and Energy markets.

The offshoring experiment for BPM has failed.  Announcements like this aren’t encouraging to me because I don’t see a lot of large SI‘s being successful with BPM deployments.  Generally you see claims of hundreds or even thousands of experts in a given technology, when the truth is about 1/100th to 1/1000th of the reported numbers.  This isn’t anything particular or personal to HCL, this is just reality in the offshore market.  This announcement with HCL isn’t any better for Bosch customers than the Lombardi-TCS partnership announced back in 2008 or 2009 was for Lombardi customers.

Offshore consulting doesn’t reduce time to market – it reduces cost-per-hour of labor.  Pretending that offshoring consulting does anything else isn’t being honest with ourselves. Time to market is improved by tight feedback loops, high levels of skill, and great communication channels.  Generally those three objectives are improved by having local staff.

The other problem is that not all hours of labor are equal.  I’ve said it before, I’ll say it again, an hour of labor is an input, not an output.  You’re purchasing the output of that hour of labor, which is why there’s variance in the price per hour, based on expected output.

If I were deploying Bosch software solutions, I’d much rather be working with a specialist firm that focuses on Bosch.   At BP3 we still believe in the value of pure play BPM consulting firms.  So which consulting firm out there is focused on Bosch’s BPM-internet-of-things?


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  • Gary Samuelson

    So true…

    Successful projects are the results of good people and communication. The most important elements in a BPM project and the very items sacrificed for offshore development.

    • exactly – there’s a temptation to assign the criticism of offshoring to nationalistic or prejudicial issues, but the reality is collaboration, time, and distance. It is no coincidence that the very first IBM BPM v8 project was deployed by BP3, in our home town of Austin TX with a local client. co-location improves velocity, as does a high skill level. If you can get both, that’s even better, obviously!

  • Jon Blankenship

    I agree completely. I worked with the offshore model early in my career and found that I could get so much more done with the internal team. So what did that leave for offshore? I would only push the small tasks off to offshore. I also found they would inflate their estimates way beyond what was reasonable and the fact that I could accomplish what they said would take 14 days with 5 developers in 15 minutes, didn’t really help things out. Great post and I would love to see more big shops take faith in the specialists in our field.

    • I think your experience is not unusual. And yet, for some reason everyone thinks the next project will be different… and then it isn’t.

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