point

January - 2015 - issue > CXO View Point

The Changing face of Outsourced Product Development

Manjunatha Hebbar, Head- Product Realization, Cyient Limited
Monday, January 12, 2015
Manjunatha Hebbar, Head- Product Realization, Cyient Limited
Product companies around the world have been on the forefront of outsourcing development and maintenance work to competent partners irrespective of time, domain and geographic barriers. Consider multinational companies or local OEMs in any country-most of them have contributed to outsourcing in some way. Rarely is product development done in-house completely. An outsourcing model-offshore, near shore or onshore-ends up being employed. The magnitude of outsourcing may vary depending on the type of work or nature of the product or lifecycle stage/generation of the product itself.

Some of the key reasons for outsourcing have been around the following:
- internal bandwidth crunch
- lack of capability around a specific module or functional expertise
- risk transfer around return on capital employed.

But, traditionally, it is in the DNA of product companies to work with third parties. Over the last couple of decades this outsourcing has become a global phenomenon. This globalization has impacted significantly the entire lifecycle of product development and the associated outsourcing.

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