Offshore Information System Development Process in India: How Practitioners Respond to the Challenges

Abstract

Offshore information systems development (ISD) has been an important practice for the last fifteen or more years, and it will likely continue to be. The potential benefits derived from lower operational costs and complementary time schedules are extremely attractive. Many organizations have successfully realized these benefits; however, others encountered unexpected challenges in the process and decided to move their operational capabilities back onshore. Current research addresses many challenges in the process and describes tools and methods for managing those challenges. However, more work needs to be done to investigate why offshoring works for some organizations but not others. This study investigates the system of offshore ISD through the eyes of practitioners by using grounded theory methods to inductively build theory to understand how they respond to the challenges that they encounter. We present an emergent theoretical model from the analysis of interviews performed with 29 respondents across 10 organizations in the U.S. and India. One portion of this model suggests that Indian organizations differ with respect to the way they respond to the challenge of solving problems that require critical thinking and creative problem-solving. While some organizations respond with an overemphasis on processes, others invest in the training and development of employees to teach them higher-level skills in consulting. This model suggests that organizations can improve performance in offshore ISD by focusing more resources toward hiring the right employees, giving them the necessary training and development, and retaining them for many years.

Key Words:

• outsourcing
• offshoring
• information systems development
• HR practices
• practitioners
• grounded theory
• unstructured problem solving
• critical thinking

Additional information

Notes on contributors

Jeremy C. Bellah

Jeremy C. Bellah received his PhD from Texas Tech University. His work experience includes functioning as the Director of Operations for a US software development company with a development office in India. He conducts research in the areas of offshore ISD and RFID technology utilization.

James R. Burns

James R. Burns is currently a Professor of Information Technology and Operations Management in the Rawls College of Business Administration at Texas Tech University. He received his MS and PhD from Purdue University. He is the author/co-author of 100 journal papers and publications on subjects as diverse as knowledge management to design of decision support systems. He is also the author of four textbooks on such subjects as information technology and management science.

Christopher M. Cassidy

Christopher M. Cassidy is an assistant professor of management at Sam Houston State University teaching courses in strategic management. He has published in the Journal of Information System Management, the American Journal of Business Education, and the Southeast Case Research Journal. He conducts research in the areas of strategic management, governance and ethics, experiential learning, and assessment. He is active in the North American Case Research Association (NACRA), the Association of Business Simulation and Experiential Learning (ABSEL), and the Southeast Case Research Association (SECRA).