Growth Through Nearshore Delivery — Delivery Through Scalable Talent

Back in December 2015, I experimented with my first LinkedIn profile blog post. Given that I was in a bit of a nostalgic mood for golf and had a lot of travel to Central and Eastern Europe under my belt, it was time to crack the ice and author a piece on the infamous “nearshore delivery model,” which has been and will continue to be accepted as par for the course – despite my solid ability to maintain a bogey-level golf handicap!

I am now sitting on the train in December 2016, traveling from our founding office in Moscow to our historic office in St. Petersburg, so I think it’s prudent to reflect upon why this matters. I will start by offering you a very relevant quote from Sir Richard Burton, in which he said, “Of the gladdest moments in human life, methinks, is the departure upon a distant journey into unknown lands.” We all can agree that India has been looked at many times by the vast majority of firms studying IT services, but we can also agree that only a small fraction of them have taken a look at Central and Eastern Europe – until now.

Luxoft has taken the lead when it comes to introducing global analysts and advisors to our centers in Kiev, Odessa, Krakow, Wroclaw, Moscow, Bucharest, in addition to, Stuttgart, Sydney, Singapore, Guadalajara, and Ho Chi Minh City. This has been the largest contribution to our grand strategy of thought leadership – not just a focused white paper discussing emerging topics like Blockchain or Big Data, but a strategy that’s focused on bringing to light the phenomenal IT professionals and the “availability of scalability” in these countries as well as the experienced and knowledgeable delivery teams that set us apart from other countries supporting outsourcing delivery.

As most outsourcing professionals are aware, and some even currently engaged with their growing “business units” within the enterprise – across all verticals – have been, and increasingly are involving themselves within sourcing recommendations, and ultimately vendor and/or strategic decision-making for their respective units, and in some cases across the entire organization. Because of the need to satisfy business units in a shorter time frame and provide a faster return on investment, nearshore has become quite important for the overall delivery of resources.

Areas like this include less travel time between client and delivery locations and less time zone differentiation between client and delivery locations. Depending on the geographic region, there are cultural and historic similarities between both buyers and providers, which aid in areas from requirements elicitation to flexible delivery coordination. Most importantly, there are very strong Tier-1 and Tier-2/3 cities with a history of university education within relevant fields (computer science, mathematics, linguistics, etc.) that have created and continue to create very talented IT professionals who are ready to contribute to leading-edge technology work.

In line with the business unit expansion of purchasing services (which requires domain expertise), there is a growing demand for consulting. Consulting can have many different definitions and styles of execution. Let’s assume it’s an aspect of the overall implementation of outsourcing services in two areas – technology and business. In cases where the client’s business unit has very little to no understanding of technology, the technical advisory role is important to help a client map and construct a strategy that will ultimately drive delivery execution. This is quite difficult to do when many of the aforementioned benefits of nearshore are not applicable. In some cases, consulting requires a much more detailed involvement with clients before the execution actually begins.

It’s easy to argue that the same model applies on the business consulting side, but in this case, it’s not the absence of knowledge that matters but rather the verification and gaining of objective opinions on the strategy. In combination with the growth of business-unit purchasing and important consulting services, the question centers around what kind of services are primarily focused on in nearshore discussions.

In many cases, the work is very Agile intensive as well as middle and front-office-dominated, and dependent on digital and customer experience as well as ERP integration and Mode-1 transformative efforts – in other words, the work should not be viewed in classic “black and white” modes. There is a great deal of interconnectedness between each mode, which can benefit greatly from nearshore adoption. As the business grows and demands increased collaboration from its central IT organization, this will continue to be a large part of the growth in nearshore, consulting, and the adoption of Mode-2-like services.

Our growth as a provider has been fueled by delivery, built upon exceptional IT talent and personal passion in the technology and business worlds. Our door is always open, and the transparency of who we are will continue to drive our success. Do not fret readers, we can scale, too!

by Patrick Corcoran, Global Director of Analyst and Advisor Relations at Luxoft and is also one of the Co-Chairman of the IAOP NY Chapter. Prior to joining Luxoft, Patrick worked as a Global Account Executive for the International Institute for Learning; Consultant with the Public Affairs Council; Teaching Assistant and Research Associate at The Catholic University of America; and was a Visiting Researcher with former ZA President F.W. de Klerk at his foundation. He holds an MA of International Relations from The New School and has an extensive publication, interview, and podcast track record. He also enjoys travel, golf, and cooking. On a side note, Patrick also worked for about nine years at King Kullen (still family owned) and recognized by the Smithsonian Institute as “America’s First Supermarket.”