Yet, working with boutiques has challenges. Time found that the promoters of SipTech wanted to sell out and exit the business. This would have brought Time back to square one. Fortunately, the onshore project manager handling the Time account pulled in the finances and bought out the owners.

Finding a boutique provider is fraught with difficulties as they come with non-standardized processes. “The best way to select one is by working on small projects, tuning them to your needs before handing over a chunk of your business,” says Bass.

This entails investing significant amount of time with the service provider and communicating your needs effectively. “But make no mistake, working with Tier 1 providers has its advantages,” Bass clarifies. “They can offer manpower with cutting-edge competencies and provide you the ability to scale up and down. For instance, after the slowdown hit the economy, Time decided to scale down its manpower from 40 people to 15 people. However, by 2004 we scaled back and the Tatas could easily step up operations with specialized people. Recently, when we wanted Java specialists, the Tatas could provide us with the manpower.”

Spending Time at the Supplier

An oft-neglected aspect of offshoring is spending adequate time with the service provider at its location. Not only does this provide insights into the way the provider’s business works, it also helps you to negotiate from a position of strength. This is especially true when offshoring complex applications development. The Time execution stands out compared to many other offshoring programs because of the time and resources dedicated to managing it. Although it is a comparatively small project with only 35 dedicated offshore resources, it calls for a high degree of involvement because of the customized nature of the company’s requirements.

Bass goes to India about three time in a year and spends a lot of time with his service providers and their customers there. “This is to exploit the successes that vendors have with other clients,” he says. Most recently, Bass visited Time’s AOL center in Bangalore. AOL has revamped its strategy, making subscriptions free for its subscribers. This has made a lot of positions redundant at the AOL center, throwing up opportunities that Time Customer can leverage. Spending so much time in India, Bass is in a position to know of these changes as they happen, and hence strategize about the deployment of his company’s offshore resources.

Spending time in an alien country calls for a brave heart, but as Bass says, it is worth all the trouble. “We all grew to like India and for a long time India was home to my kids who were aged 6, 7 and 8 at that time,” he says. “Even a long time after we moved back to Florida, my kids would often ask when we were retuning home to Chennai.”

Of course it helped that Bass and his wife had spent many years outside the U.S. as kids. Bass’ wife, daughter of an oil executive grew up in North Africa, while Bass’ father who was in the military was born in Germany.

Offshoring Through Growth and Attrition

Despite growing concern about offshoring in the U.S., Time Customer never encountered any problems primarily because its offshore strategy was to expand through attrition and growth. Time took care to ensure that its existing staff never felt threatened, and communicated its strategy to the in-house team.

Time’s strategy with regards to TCS was to augment its staff for support. “So the onshore team was never really affected. Whenever there was attrition we would not hire locally, and fill that position offshore.” Besides offshoring was a necessity as certain mundane jobs, like documentation and coding, could not excite onshore workers.

Time’s strategy was to push commoditized work offshore while retaining cutting-edge technology onshore. Onshore attrition being negligible, the attempt was to position the retained team as business analysts and architects and build their communications skills to work effectively with the offshore teams. This meant the onshore team had to keep ahead of the learning curve with new technologies. Time spends about five percent of its offshoring budget to train internal employees in emerging technologies.

Measuring Productivity

Although ADM is one of the most common things being offshored, there is varying degree of satisfaction as it is difficult to measure productivity. For instance, while TCS was at CMM level 5, Time had initiated CMM levels 2 and 3. This was not so much to align with TCS’ maturity as much as it was to streamline internal processes to leverage the relationship further. In fact, Bass says TCS was operating at whatever maturity level Time had, and this could have had a negative impact on efficiency. This was because Time always looked at the relationship as staff augmentation and never outsourced completely.

Recently, Time launched a process-management initiative to measure the effectiveness of its offshore and onshore teams, identify gaps in productivity and document process to enhance productivity. It also started an initiative to institutionalize offshore knowledge within the company by setting up the Time Warner Offshore Advisory Office to define and manage implementation, processes, define data security issues and work on its in-sourcing strategy.