Seamless nearshoring - Itera's way

Seamless Nearshoring

Seamless nearshoringItera’s Way

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• Vice President Global Outsourcing at Itera• Vice President, “IT Ukraine” Association• Scientific-Methodological Commission on Software

Engineering, Ministry of Education and Science of Ukraine• Co-founder of SoftServe, one of the largest software

house in Eastern Europe with1200+ personnel

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Igor Mendzebrovski, VP Global Outsourcing

, 04/12/2023


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• Premium Nordic IT provider with nearshoring capability

Seamless Nearshoring: Vision

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Collaborative engagement model with a flexible split between on- and offshore

Experienced offshoring management team with proper QA layer of internal processes

Premium IT resources, cultural similarities, geographical proximity


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Itera’s Hybrid Model

Nordic footprint

Sales, legal and financials

15+ years local market maturity

Critical business deliveries

Nearshoring arm

Premium ICT resources

Pro-active communication culture

Strong offshoring experience


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Sourcing for Value vs. Sourcing for Volume

Maximizing efficiency (Value)• New/complex systems• Challenging projects• On/off-site resource balancing• Core business value

Optimizing utilization (Volume)• Repetitive businesses• Straightforward projects• Workload balancing• Complimentary services

Net realized savings ranging from 10% to 40%

Resource Pool| Sourcing for Value Sourcing for Volume

Salary level - SeniorSalary level - Junior

Same SameUp to 50 % less

Team size Compact, efficiency driven Larger, volume driven

Attrition rate >7% >14%

Governance & hierarchy Transparent & flat Low transparency and complex

Productivity High Less

Travel time & expenses Less High

Cultural match Very good Low


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The “Value” Parameters will give better business flexibility

Large pool, large spread

Less pool, less spread India

Ukraine


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Client Engagement Options

• SLA levels 1, 2 & 3• Long-term• High business value

Application Outsourcing

• Medium-term• Specialized teams• Discrete engagements

Project Outsourcing

• Continuous engagement• Managed by client

Team Outsourcing

• Fills in acute client needs

Consultants Outsourcing


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Delivery Framework

Engagements Models

Application Outsourcing

Project Outsourcing

Team Outsourcing

Consultants Outsourcing

Methodologies

SCRUM

Iterative

RUP

Software Development Approach

People Tools Practices


• Focused on life tested practices

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Quality of Seamless Nearshoring

• Mandatory project practices are tailored to meet client’s needs

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Management processes

Project management

Quality Assurance management

Risk management

Configuration & Change management

Requirements management

Development processes

Business analysis

Software design

Software development

QA testing

Deployment


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Three ways to add business value to IT organization

Goal #1: Maximize sourcing flexibility• Deliver sourcing flexibility to local resource pool seamlessly

extended to nearshore (AD, AM, R&D, etc.)

Goal #2: Drive innovation and R&D• Drive product innovation & time-to-market by establishing product-

focused nearshore teams with scientific-research capabilities

Goal #3: Increase customer focus• Retain frontline strong focus on clients while conveying application

evolution, debugging, optimization and etc. tasks to nearshore

• Local team is extended with nearshore one focused on development and support in a knowledge intensive development environment

• Unified project framework is established, that facilitates knowledge sharing and collaboration between geographically distributed teams

• Easy to scale up or down• Minimum impact to efficient delivery and timeline due to possible rotation

• We call it “Hybrid Approach”, it is optimized for resource balancing for up- & down-scaling due to the organizational set-up with roles distributed more or less evenly (incl. knowledge sharing) across the shores (more like “staff augmentation” approach)


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Goal #1: Maximizing sourcing flexibility

AM and Support

BA and AD

Product 1 Product 2 Product m Product n

Hybrid (Local / Nearshore) team

• Dedicated nearshore team takes on existing or new product• Business and competitive analysis• R&D planning and executing• Next generation technologies and methodologies• Hi-level knowledge sharing (incl. product strategy, road map) is involved

• Product innovation approach is optimized for faster time-to-market within agile management / communication environment for relatively localized or stand-alone products or systems


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Goal #2: Drive innovation and R&D

R&D and support

BA and consulting


Local team Nearshore team

• Nearshore team backs up local R&D by delivering hours intensive services like: refactoring, technology improvements, extensive QA, etc., – freeing more hours to frontline workers and client intensive developments and services. Competitive advantage is gained through:

• Strong focus on clients and markets• “Pure” R&D front office attracts talents• More hours to invest into robust, bug-free products

• Roles distribution in horizontal functional split is optimized for focused teams and efficient services / product delivery


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Goal #3: Increase customer focus

AM, fixing, tuning, etc.

BA, R&D, consulting


Local team

Nearshore team

• Management Overhead - Caused by more complex, distributed Project Environment

• Communication Overhead - Caused by Distance, Time and Cultural differences

• Business Domain and Regulations Expertise - Caused by lack of necessary expertise in Outsourcing Environment


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Best Practices to Answer Outsourcing Challenges


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Collaboration Approach

Vision/Scope

• Define business needs

• Adjust pricing model

• Discuss QA scope

Analysis &

Planning

• Define Technology

• Transfer knowledge

• Feasibility study

• Adapt practices

• Detailed estimates

• Detailed plans

Pilot (s)

• Reasonable size and functionality

• Adopt communication habits

• “Post mortem” analysis

• Adjust practices

Optimi-zation

• Delivery framework integrated

• Quality Assurance & Testing

• Tools

Strategic asset

• Integrate into client’s processes

• Enhance value chain


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4 steps to outsourcing partnership include

• Business Case• Workshop in Ukraine• Align business expectations• Define key drivers

0:Initiation


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Geographical and cultural proximity

2.5 hours

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• 20+ years global outsourcing player

Ukraine Nearshoring Destination

#4 IT-resources pool in the world, followed after USA, India & Russia

TOP 15 IT-services exporter, globally

Long lasting traditions in fundamental ICT


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• Size: about that of France, population 46 million• Time zone: 1 hour ahead of Norway• Travel: 2.5 hour flight from Oslo, visa not needed for EU citizens• High cultural similarity, common historical roots

Resources

• #4 world largest pool of IT resources – 125.000 specialists *• 6% of world ICT scientists**• 348 Universities, 35.000 graduates annually in Technology & Engineering **

• 15,000 – B. Sc. Degree• 10,000 – M. Sc. Degree• 1,000 – Ph.D. degree

Focus and Expertise

• Research & Development• Hi-Tech Engineering


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Our Nearshoring Facilities

• Co-located with Microsoft Ukraine in Kiev

• Appealing workspace

• Attracts talented people


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• Nearshore Development Center (NDC) structure combines Production and G&A

• Production is services or business lines: Engineering, Operations, QA etc.• G&A secures governance, legal, financial and etc. services for ODC

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Itera Ukraine Organizational Structure

General & Administrative

EDEngineering

SOService Operations

QAQuality Assurance

Country Manager

FINFinances&Accounting

PQAProcess QA

HRHuman Resources

SASystem Administration

O&SOffice & Support

Production

Project Team

Project Team

Project Team

Project Team

Project Team


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• Sourcing for Value, not for VolumeMaximizing efficiency instead of capacity only

• Flexibility of a Hybrid ModelCombine on- / near-shore resources for your best result

• Best Offshoring PracticesLearn from other’s offshoring outsourcing lessons

• Do More For LessRemove budget strains & optimize your costs

Summing Up


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Looking forward to work with you!

We heartily invite you to visit Ukraine

http://seeker401.wordpress.com/2009/11/01/ukraine-shuts-down-for-3-weeks-over-swine-flu/ukraine_monastery_2003_04_25/