This article reflects information as of 2020. For the latest details, please contact us.
Placing work with lower-cost regions inside your own country is called nearshoring.
Going further afield in search of even cheaper labor and outsourcing overseas is called offshoring. But offshoring causes so much trouble that some people have been so badly burned they say, "Never again!"
Almost all offshore trouble comes down to miscommunication that stems from [cultural differences].
When considering offshore work, you'll often be placing orders with countries like China, Vietnam, or India. Keep this lens of cultural difference in mind as you read points 1 through 3 below.
1. Put everything into words! "Reading between the lines"? What's that, is it tasty?
There's a tendency among Japanese people to prize the ability to "hear one and understand ten," but in production and development it's nothing but harmful.
Sadly, documents often get produced with that ability to infer baked in.
"This part is the same as the previous page, so I don't need to spell out the details."
"The structure is the same, so they'll surely turn it into a template."
"I don't need to specify the colors—they'll handle it nicely."
The writer means no harm, but they end up producing something that omits a few "unimportant" details while imagining the reader's ability to fill in the gaps.
Fundamentally this is a serious problem, but when Japanese people work together, that problem gets papered over by the ability to infer—which only makes it more deeply rooted.
When someone who has grown accustomed to relying on that ability to infer runs an offshore project, they cause trouble 100% of the time. That's not an exaggeration—it's literally 100%.
When you ask people overseas to do work for you, you need to document everything.
Anything not documented is, from their point of view, work that "doesn't need to be done." In fact, I get the sense they even expect to be scolded for making judgment calls on their own.
For example, if you write on a product description page, "This description text is a sample. Please delete it before going live," the page will come back with exactly that text still in it. Even if the person doing the work understands Japanese.
I believe this is not a matter of ability but a matter of culture, so it's not something they should be scolded or re-educated over.
The only way to prevent it is for the client side to create documentation that spells out everything, so when you offshore, prevent trouble before it happens by building solid documentation.
2. The ultimate bottleneck! Is your local PM's workload okay?
When you run an offshore project, the person your staff communicates with most is the local PM (project manager).
Many of them can speak Japanese, and it's a crucial position that relays instructions from the Japanese side to the local members.
But when a project catches fire, this local PM visibly burns out.
The cause is that, in parallel with the job of relaying instructions from the Japanese side to the team, they're also performing QC (quality control)—checking the deliverables coming up from the team.
The ability to infer I described in point 1 can be managed to some degree by anyone who has learned Japanese, and that only adds to the local PM's exhaustion.
The only person on the ground who can check for gaps and omissions in things not written in the documentation, or verify whether the client's intent has been grasped, is that local PM.
The local PM becomes a bottleneck because they single-handedly absorb every bit of communication loss, so having the client-side PM travel to the vendor's country to help out here can suddenly solve the problem.
Creating and giving solid documentation as in point 1 is important, but by taking over the checking of deliverables coming up from the team on the client side, you can lighten the local PM's load and, as a result, raise both speed and precision.
"If you're going to do all that, I'll just do it domestically."
I understand that feeling.
But if you understand from the very start the basic premise that offshoring simply cannot be run the same way as domestic work, you can avoid many problems.
For example, when calculating costs, you need to factor in costs that don't arise in domestic development—such as taking over the local PM's work.
By firmly recognizing that premise, you can calculate costs appropriately and make risk management easier.
3. The cultural differences within the cultural differences
This is the most important point, so I'm pulling out the cultural differences on their own.
It's easy to forget when you're talking with a local PM who speaks Japanese, but the team on the ground is a different culture.
Cultural and religious holidays, attitudes toward overtime, and so on are completely different.
This actually happened on a global project: over the year-end period,
The American client: We take Christmas leave early, so we can't review or approve anything.
The Japanese agency: We absolutely do not work over the New Year holidays.
The Chinese development company: We definitely don't move around the Lunar New Year!
—and the project ground to a halt to an astonishing degree, from mid-December all the way to February.
This is a cultural matter that simply can't be helped, so you have to proceed treating it as just how things are.
It's impossible to understand every one of these cultural differences, but to align at least a little, communicate thoroughly with the on-site members through regular meetings.
Talking about the actual work is very important in these regular meetings, but what I'd especially recommend this time is small talk.
Small talk deepens mutual understanding, and as the on-site people get to know you, the project's cohesion grows.
Cohesion is a magic spice that prevents projects from catching fire.
By always being aware of cultural differences, taking what looks like wasted time to understand the other side, and building cohesion, you create fertile ground where people can casually ask small questions.
Being able to ask those small questions prevents things from getting misaligned, fills communication gaps, and as a result stops projects from catching fire before it happens.
There are still many more things to watch out for in offshoring, but just being mindful of these three points dramatically lowers a project's risk.
We handle many offshore projects ourselves, so if anything comes up, please don't hesitate to get in touch.