Offshore development center (ODC)

Offshore development center (ODC) is one of the business models by which a provision of offshore programming is undertaken. An ODC is made up of a dedicated team of programmers and developers who have been hand picked to complement the customer's skill set and culture. This customized team works exclusively on behalf of the customer at the service provider's site or their own captive site in a secure environment. The infrastructure and security can be designed to meet the customer's specific standards and specifications, and may include co-branding. Indeed, the closer the synergy between an ODC and an organization's own IT/development department the better.

Why an Offshore Development Center (ODC) model is beneficial

An offshore development center or ODC is a dedicated development center located in locations such as India, for carrying out software development, testing or related support and maintenance activities. Organizations can choose from setting up an ODC on their own, or give the mandate to setup an ODC to an experienced offshore service provider. The latter model is far more beneficial as offshore providers share infrastructure components among many clients – and hence the total cost incurred per client comes down drastically. In a project-based model, a new team is formed for every project. Hence, knowledge retention and the benefits of reusability cannot be availed. This issue is effectively tackled by the ODC model, where the responsibility of staffing and quality is on the vendor. As the vendor has an incentive to improve productivity on a year to year basis, it deploys the best frameworks and methodologies to achieve the best possible efficiencies. To further the productivity gains, vendor also starts focusing on the interface points with the client organization, propagating best practices onto these interface points. This results in the standardized processes percolating through to the client side of organization, a desirable value-add from outsourcing perspective. Additionally, once a basic foundation for an ODC is established, the model is flexible and easily scalable. This can enable a quicker launch of new projects for a particular client, as processes are standardized and customized, and past knowledge is captured for reuse. For example, a database of known errors for say, an SAP application in North America, can be used in another project of the same nature in say, Europe. This enables faster resolution, and allows maximization of savings. Moreover, experienced service providers have the benefit of working with hundreds of clients, which helps them in fine tuning the technical, functional, and governance skills required in managing an ODC.