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Innovation and offshore

I’ve read some interesting articles lately regarding how to get your offshore partner to innovate. One in CIO magazine; covered the topic pretty well with regard to what you have to change to spark innovation. But I’d like to add some specific areas where a multi-shore arrangement can transcend the usual SLA / price model to an arrangement that in itself can be innovative.

In short, the SLA / price model is certainly important. But it can also be the source of constraining innovation. Think about your contracts with US (onshore) providers. While there are always (or at least should be ) performance measures in any relationship to deliver services, often they are loosely defined. Further, even when many providers do not specifically meet the original metrics, customers will report that they are happy with the services that were provided (as evidenced not by surveys, but by looking at repeat business with that supplier).

Probably the biggest reason for this seemingly contrary behavior, is the weight that customers apply to the relationship under which the services were performed. Good customer service is part delivering on your promises, but almost as important is managing expectations when things change, as well as introducing new methods or ideas into the organization with whom the supplier is working.

The definition of ‘innovation’ is just as described. The ideas don’t have to be new to the industry or the supplier. Innovation is not always dependent on creativity. But innovation is highly dependent on fostering a culture of ‘sharing’.

So the real question then becomes – what constrains ‘sharing’? Certainly it could be that the supplier has nothing ‘new’ to share with the customer.  But I would contend that suppliers are actually uniquely positioned to share ideas. Consulting firms (Suppliers) work with hundreds often thousands of customers through the years. They generally have strong Knowledge Management practices and tools in place, and these tools are fairly well populated and leveraged. Certainly that collective repository of ideas is far more extensive than any one IT organization has access to. And in fact, a supplier *depends* on that knowledge capital as a way to differentiate itself from competitors.  In short – the internal sharing of ideas is the cornerstone upon which most consulting firms are based.

So why doesn’t this ‘sharing’ (innovation) extend to all customers? Certainly (as the CIO article above points out) there are some customer practices that dampen that sharing. Innovation is all about risk and reward. There is risk in trying something new, even if that idea has worked in other environments. If an SLA is too restrictive, or doesn’t also measure what innovation comes to the table, then a supplier is unlikely to share. And believe me – part of what makes a successful consultant is being perfectly fine with keeping your ideas to yourself if someone doesn’t want to hear them.

Which brings me to a second point. Sometimes, the customer doesn’t actually *want* innovation, even if they ask for it. Change requires more than just a desire for the outcome of the change. It requires passion and commitment that gets you over the change ‘hump’ and into new territory. It requires tenacity and courage to push through the inevitable resistance. And that passion for change has to be injected throughout your organization. Telling your supplier you want ‘change’, but putting the responsibility to drive all levels of your organization through that change solely with your supplier has passive aggressive derailment written all over it.

So where are those specific areas of multi-shore innovation I spoke of earlier?

1. Write your ‘contracts’ from a partnership perspective rather than a supplier-consumer perspective. If you wan to tap into people’s innovation, then you have to treat your supplier as a collection of people rather than a collection of bodies and hours. ‘Offshore resources’ are people. Bright and creative people that have life experiences and ideas that can be very different from your current team members (and vice versa). Innovation is about extending your sphere of experiences through others.

2. Focus on the importance of retrospectives at all levels. At the end of an iteration, at the end of a release, quarterly at the PMO / exec level – don’t just report – reflect. Restructure your supplier meetings so that only 1/3 of the time is spent reviewing statistics. Make them ‘conversational’ and interactive. Ask questions of each other, and worry less if every answer is a ‘gem’ or perfectly worded.

3. Put ‘Innovate’ as a line item in each iteration plan, project plan, dependency list, etc.. Assign it to someone once per iteration with time allocated to it. Track to make sure it’s getting done. Want to know why some folks are better at networking with others? I’ll bet they have it on their calendars as a concrete activity. Want to know where some folks, with just as many priorities and responsibilities as you, find time to read, exercise, travel, complete home projects and engage in charity work? I’ll bet every one of them schedules it as a ‘meeting’ or ‘activity’ to block out their calendars on a weekly basis. And every one of them treats those time blocks as a high priority ‘meeting’. This is not new stuff. Apply it to innovation.

4. Stop thinking about onshore / offshore. Think ‘multi-shore’. Too often we let time zones and geographical separations define out interactions – rather than ‘re-defining’ those interactions simply taking those things into consideration. The difference is a point of view. By default – out of sight, out of mind. But just because people move out of your immediate sight, doesn’t mean you can’t boost interaction across other means. Good multi-shore providers actually have a long list of how to do this effectively.

5. Embrace running multi-shore projects using an Agile methodology. Seek out suppliers that have a demonstrated history of knowing how to do this. It’s hard to get right the first time, so don’t make it your first time. Find a partner that does it ALL THE TIME. Test their knowledge during evaluations because all the suppliers out there are glomming onto the ‘Agile’ buzzword. Ask experience based questions. Ask them for white-papers, webinars, blog posts, etc. Ask for a run-down of their history with Agile and multi-shoring.  Make sure they’ve done it – otherwise, disaster will loom.

This is just meant to be a starter. Lots of ideas floating around in my head on this subject of innovation. Would love to hear from you and be challenged around new ideas.

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Kevin Sheen, Vice President, Global Delivery

Kevin is responsible for Perficient's Global Delivery strategy and execution with teams distributed across the globe in the US, India, China and Mexico. With a background rooted in software development, he has been an Agile evangelist and practitioner for over 20+ years and has been advocating Agile as a way to make global teams successful since Perficient launched it's first global delivery center over 13 years ago. Scrum Certifications: CSP, CSM, CSPO

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