Does it matter what country my vendor operates in?

Our CEO, Yousef Awad, published an article in InfoQ about country options when outsourcing. What’s the right choice? Does country matter? And if so, how do you know your outsource provider has chosen the right one? A good outsource vendor will consider factors that go well beyond just tapping into an available and/or inexpensive talent pool, such as:

  • Real cost
  • Government stability
  • Code/IP security and crime
  • Infrastructure
  • Cultural compatibility
  • Time zone overlap
  • Education
  • Retention
  • Recruiting

In consideration of the factors above, we chose to establish development centers in Jordan and Egypt. Both locations allow us to work within a “real” cost per hour that is competitive with other vendors, and both rank in the top 20 of most attractive outsourcing destinations for IT. But what made them the right choice for our clients and us? The decision-making process wasn’t easy and it shouldn’t have been. Read Yousef’s article for details. In the meantime, here are answers to some questions you may have:

How do you address cultural compatibility?

Cultural compatibility matters and there are definitive differences. The real question is how does your outsource provider deal with this? We recruit, hire, train, and mentor with eyes wide open about differences that can affect communication, cost, or quality.

For Integrant, more than anything, culture is about sharing the same work ethic, quality, and customer service values. It’s incumbent upon us to hire and train not only for technical prowess, but just as importantly for personality characteristics.

We provide cultural mentoring for our coders.

  • Go beyond the stated task. Always map back to the goals of the project.
  • Address the immediate need while considering relationships, looking back, and planning for the future.
  • Anticipate what else is needed. Ask yourself what may have I forgotten?
  • Communicate your understanding of the ideas, plus add your own.
  • Build trust with your client. Show them you can make decisions on their behalf.

So, if Integrant hires a brilliant coder who is timid, we train them to speak out. If we hire a brilliant coder who sees trees and no forest, we pair them with a team member who is all about the forest. The onus is on us to hire and train the right people for you.

Our project leads and senior staff travel back and forth between our dev/test centers and the client site on a regular basis. We narrow the cultural divide and enhance our staff’s ability to relate with our clients.

 

Are U.S. relations with your overseas locations stable?

Egypt and Jordan are two of the U.S.’s three biggest allies and trading partners, along with Israel, within the region. The U.S. spends over $2.5 billion in economic aid to Egypt and Jordan. This close relationship with the U.S. means an important degree of stability.

I’m concerned about security and protecting my IP. Does it matter where your dev centers are located?

Yes. We are headquartered in the U.S. with dev centers in Egypt and Jordan. In terms of overall crime, Egypt and Jordan are safer than other major outsourcing geographies such as Russia, China, India, and the Philippines.

More specifically, in terms of country rankings with respect to software and piracy, countries such as China, Russia, Ukraine, and Taiwan are ranked among the worst 20 whereas Egypt and Jordan are not on the list.

More importantly, your outsource provider is responsible for managing code and IP security independent of any country rankings. This should include IP rights, network security, physical security, information protection, personnel security, customer privacy, disaster recovery, and business continuity. For Integrant, this is a function of whom we hire, our own policies and procedures, and our ability to establish development centers in countries where we can work efficiently within that country’s legal, structural, and procedural boundaries. Here is more info on how we tackle security.

In 20 years of offshore operations, we’ve maintained 100% uptime and 100% business continuity for our customers.

IP Law

Both Egypt and Jordan have IP security laws in place that meet World Intellectual Property Organization (WIPO) requirements. In Egypt Law No. 82, passed in 2002 addresses the Protection of Intellectual Property Rights. Law 82/2002 reflects the major provisions of the Trade Related Aspects of Intellectual Property Rights (TRIPs) Agreement and was supported by the U.S. government and the U.S. private sector. In Jordanian law there are 62 texts surrounding IP law. Jordan’s accession to the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement and the country’s level of IP protection have brought many new opportunities to the country.

Integrant has in place an internal Compliance Department headed by our VP of International Business. This department monitors labor laws, tax laws, security and IP laws specific to Egypt and Jordan.

Why U.S. Headquarters Matter to Security and IP Protection

If you’re working with Integrant, you have the additional security that we are accountable to U.S. laws and standards. Integrant was founded in San Diego, CA in 1992 and opened its first development center in Amman, Jordan in 1997. Eleven years later we opened a second development center in Cairo, Egypt. Both offices are wholly owned by Integrant. Having multiple offices in different countries adds to our disaster recovery plans and ensures business continuity.

If you’re working with a vendor whose headquarters are overseas and the security and IP laws in that country are either not strict or not enforced or both, your ability to prosecute may be limited. If a U.S. company signs a software development agreement with a foreign vendor or a company with offices in the U.S. but headquarters overseas they may not have any recourse if there is a problem and the vendor fails. This gets compounded if the outsourcer has multiple headquarters or is servicing multiple clients in multiple countries as they can shift responsibility around.

Our headquarters and executive management team are located in the Sorrento Valley area of San Diego, CA. All three offices are liable and accountable under U.S. laws, protecting our clients. All our employees are full-time staff; we do not subcontract any of our work.

 

How strong is the labor pool in your overseas locations?

The first step at looking at whether there is a strong talent pool from which to recruit in a particular country is to look at what other companies are successfully recruiting within that country. Are other companies finding the caliber of talent and the skillsets we’re seeking? We found that for both Egypt and Jordan the answer was yes. Members of the U.S.-Egypt Business Council include Microsoft, Oracle, GE, Google, GM, FedEx, Visa, Xerox, Merck, and MetLife. U.S.-based companies in Jordan include Google, Microsoft, Yahoo, and Cisco, American Express, General Electric, and others.

Understanding the local talent pool available in any geography includes evaluation of the level of education provided. Both countries are big supporters of education and the advancement of technology, and both specifically invest in students pursuing a technical education. The Egyptian and Jordanian government highly subsidizes higher education for its most promising students. Egypt and Jordan host four of the top universities for computer science in the region. In addition, many in the region have lived or studied abroad in the United States and Europe, which adds additional levels to both their education and understanding of U.S. culture.

How can I be sure you know how to operate an overseas dev center?

It’s very different running an office in another country. Even the basics are different. We have to ask ourselves:

  • What does Internet access look like in various parts of the country?
  • How can we ensure continuous Internet access and support utilities?
  • How do people get to work? Where should I open an office to attract top talent?
  • Can people work remotely if they have to? Is it easy for clients to reach our people during off hours?

Client success requires our understanding of the infrastructure, politics, administration, paperwork, red tape, tax and banking systems. This if often the biggest hurdle to overcome for any outsource provider headquartered in the U.S. and looking to open an office in another country.

To meet this challenge we have dedicated resources whose responsibility is to manage and navigate country-specific legal and structural landscapes. We have a full-time on-site VP of International Business, Rami Awad.

Rami, in fact, helped establish the Jordan dev center in 1998 and applied that knowledge in evaluating and then opening the Egypt dev center in 2008. By choosing two similar locations we have taken advantage of similarities in infrastructures, enabling us to apply knowledge of one country’s operations to the other. Additionally, with only an hour’s flight between countries we are able to leverage both locations for disaster recovery and co-lo purposes.

The presence of our on-site VP of international business coupled with both Egypt’s and Jordan’s close relationship as allies of the U.S. means that our staff has no issues with work visas, travel restrictions, or any other logistical challenges making it easy for us to travel to you.