siliconindia

Typical Product Development Challenges and Global Resourcing as an Emerging Opportunity

Author: Arpan Banerjee
The author is AVP Business, Innominds Software
Typical Product Development Challenges and Global Resourcing as an
Emerging Opportunity -By-Arpan Banerjee
Global product companies or Independent Service Vendors (ISVs) are always under performance pressure, as would any of us in our respective jobs. They strive for market expansion, increased product features, and new product ideas and face the regular constraints of decreasing profitability, increased competition, dearth of resource and skills, and rising costs with simultaneous pressure to upgrade and widen product offerings while using fewer resources.

Product-development planning remains crucial to organizations' survival. Some key challenges, and hence success factors are as follows: Development Speed: 'Faster and faster' is the mantra of product development. One way to hasten development speed is through digital design, analysis, and collaboration tools to get products to market faster. Using collaboration software, file-sharing software and more, engineers can transform ideas into digitized virtual designs for testing and viewing a new product in three dimensions, within months rather than years.

Platform Flexibility: Every product guru will acknowledge that a key success factor of a product in the market is its platform flexibility. This results from using modular product architecture to provide more product variety to customers. Computer aided design and engineering tools permit easy reuse of already completed design files. All these files make product design much more efficient, cost effective, and accelerated than ever before.

Complexity Management: A product stands apart from an application in its complexity. It involves engineering complex systems through analysis of interaction networks. Research has resulted in network modeling methods to examine a network of interacting elements that form part of complex systems being developed. The challenge of engineering complex systems with many components, sometimes called systems engineering, remains a key success factor.

Outsourcing and Offshoring: Finally, the biggest challenge that remains is optimizing in-house skills, supplier skills and capacity, international operations, and new markets. Sometimes outsourcing saves considerable cost and sometimes a little cost, but more importantly, it actually helps in taking advantage of global product development networks, largely to access new markets in different locations and leverage global talent pools. Let us have a closer look at the outsourcing opportunities.

Modern communication tools and the Internet have reduced the need for product development partners to be geographically close. Indeed product development is increasingly being divided between locations, with different parts getting created in multiple centers around the globe and brought back together for integration and testing. The ability to succeed at global project management is the key challenge in this model.

As the challenges grow in the face of global inflation, strengthening currencies, slowing economies, dried up venture funds so will be the opportunities, to springboard ahead of competition by globalizing. Two immediate channels that help bring in the advantages of globalization are building captive centers across the globe and outsourcing. Both have their pros and cons, but given the scale of expansion and flexibility, outsourcing is well acknowledged as the greatest opportunity for the entire product-engineering ecosystem.

The opportunities obtained through outsourcing, leveraging local presence of partners, 24x7 development and support centers, multi-dimensional skills, and matured processes and best practices are fairly known as follows:
At this stage the founder(s) start pondering about their next step. Must they exit? If yes, how? Should they take the company public? or should they sell the company to a larger player? Should they step back from the company and let professional management take it over completely? The answers to these questions decide the path that sometimes leads them to the beginning of their journey once again, i.e. to start another product company.
* Leveraging skills
* Speeding up time to market
* Global market expansion
* Superior Customer support
* Enhancing product development processes * Localization benefits

The emerging best practice for software development is to decouple product design and development (along with testing and support) elements in the value chain. The life cycle of product development is increasingly being divided into phases that require internal expertise (and value-adding), which is essentially in product definition and design phase; whereas steps that are highly commoditized include development, testing, and support.

The division of responsibilities between IT personnel and outsourcing staff is specifically a critical factor in the success of the project and generally in the outsourcing relationship. Moreover, outsourcing vendors have made tremendous advancements in the metrics for quality and investment that drive greater efficiency into the overall process.
Offshore is usually regarded as a tool for labor arbitrage. However, it has its hidden benefits like higher quality and development discipline of the 'right partners', which lead to greater efficiency and productivity levels that are sometimes superior to the in-house engineering organizations of ISVs. Moreover, in the coming years, outsourcing vendors will expand further into the value chain of product development. Additional expertises emerge to dominate emerging technologies (for example, Web2.0) and develop deep vertical expertise.

To conclude, today's nextgen software products are evolving with a distinct global flavor. The products are developed with the globalization model already deployed by large companies like Microsoft's and IBM's but are extending down to regional and specialty players - enabled by offshore outsourcing. Offshore vendors are increasingly being involved in architecture, development, and deployment of a wide range of products from embedded products to software and hardware design. Products that are not born out of the global sourcing model will lose their competitiveness in the coming years.
Previous  article
 
Write your comment now

Email    Password: 
Don't have SiliconIndia account? Sign up    Forgot your password? Reset
  Cancel
Reader's comments(3)
1: Great and Insightful article, Thanks for sharing wonderful article, and always looking like yours' Thanks
Posted by: Amit Kumar Dwivedi - Monday 02nd, February 2015
2: From: Mrs. Mary David

This mail may be a surprise to you because you did not give me the permission to do so and neither do you know me but before I tell you about myself I want you to please forgive me for sending this mail without your permission. I am writing this letter in confidence believing that if it is the will of God for you to help me and my family, God almighty will bless and reward you abundantly. I need an honest and trust worthy person like you to entrust this huge transfer project unto.

My name is Mrs. Mary David, The Branch Manager of a Financial Institution. I am a Ghanaian married with 3 kids. I am writing to solicit your assistance in the transfer of US$7,500,000.00 Dollars. This fund is the excess of what my branch in which I am the manager made as profit last year (i.e. 2010 financial year). I have already submitted an annual report for that year to my head office in Accra-Ghana as I have watched with keen interest as they will never know of this excess. I have since, placed this amount of US$7,500,000.00 Dollars on an Escrow Coded account without a beneficiary (Anonymous) to avoid trace.

As an officer of the bank, I cannot be directly connected to this money thus I am impelled to request for your assistance to receive this money into your bank account on my behalf. I agree that 40% of this money will be for you as a foreign partner, in respect to the provision of a foreign account, and 60% would be for me. I do need to stress that there are practically no risk involved in this. It's going to be a bank-to-bank transfer. All I need from you is to stand as the original depositor of this fund so that the fund can be transferred to your account.

If you accept this offer, I will appreciate your timely response to me. This is why and only reason why I contacted you, I am willing to go into partnership investment with you owing to your wealth of experience, So please if you are interested to assist on this venture kindly contact me back for a brief discussion on how to proceed.

All correspondence must be via my private E-mail (dmary4love1@yahoo.fr) for obvious security reasons.

Best regards,
Mrs. Mary David.
Posted by: mary lovely david - Monday 26th, September 2011
3: tataosah@yahoo.com
Hello.
My Name is Tata I was impressed when i saw your profile at ww.siliconindia.com and will like you to email me back to my inbox so that i can send you my picture for you to know who i am.i belive we can establishe a long lasting relation ship with you.In addition,i will like you to reply me through my private e mail box (tataosah@yahoo.com).
This is because i dont know the possibilities of
remainning in forum for a long time.
Thanks,waiting to hear from you soonest.
Tata.
Posted by: tata tatababy os - Friday 30th, October 2009
More articles
The retail industry is witnessing an increased migration of customers ... -By-Kaushal Mehta
by Kaushal Mehta - Founder & CEO, Motif Inc..
The retail industry is witnessing an increased migration of customers from traditional brick and mortar retail to E-commerce (online retail)...more>>
Its 1 AM. Do You Know What Your Offshore Team Is Doing? -By-Samir Shah
by Samir Shah - CEO, Zephyr .
You probably do because you are on the phone with them! For all of you working in some technical management capacity here in Silicon Valley,...more>>
Disconnect: The Root Of All Execution Evils -By-Raj Karamchedu
by Raj Karamchedu - Chief Operating Officer, Legend Silicon .
These days are a mixed bag for me. Of late I have been considering "doing something bigger and better," in my life, perhaps seriously though...more>>
IT Services Rise Of Tier II Companies -By-Madhavi Vuppalapati
by Madhavi Vuppalapati - CEO of Prithvi Information Solutions .
IT Services Rise of Tier II companies The Indian IT outsourcing industry is going through very exciting phase in its business life...more>>
DLP, Prevention Is Better Than A Cure -By-Bhaskar Bakthavatsalu
by Bhaskar Bakthavatsalu- Country Manager, India and SAARC of Check Point Software Technologies.
Data loss occurs every day through corporate email. In fact, given the sheer number of emails an organization sends every day, data loss inc...more>>