Building agile teams in India: Pt 4: 20/20 Hindsight

 I was asked recently: "If you were asked to set up a new office for an Australian company (similar to Aconex), would you choose Bangalore?" this was in conversation with my colleagues, Mike Melia and Craig Brown, here at Aconex. Here's an edited version of the ensuing discussion:

Me: "Its a good question, and actually one that I have been asked by 2 other companies since. The answer, as always, is ‘it depends’, what are the primary drivers for doing so, such as, timeframes, cost, etc.

"I think, on the surface, Bangalore seems a good place to target, there are a lot of IT companies in Bangalore, ergo it is a safe place to set up an operation, which, is possibly the best reason NOT to. Aconex' experience has been positive, but it took a lot longer, and cost more than we expected. We still have a number of unanswered questions, and challenges, especially around hiring senior 'hands-on' techies.

"Would I suggest Bangalore as the ‘primary’ location to set up an agile development centre given what I know now, hmm.. It’s a tough question. It appears a lot of organisations trying to offshore development into India face similar challenges.

"Company A (name hidden to protect my sources) are currently looking to build offshore capability in a different way, they've bought into a company here in Bangalore and one in KL and there plan is to use a well known agile consultancy to build the capability onto an existing team. It will certainly be interesting to see whether this is succesful.

"Outside of Bangalore, countries I would explore would be Vietnam,  The Phillipines, or even, other cities in India, but, these are if priority for business are, in order: Cost and Access to talent. Vietnam and the Phillipines are still emerging as software development centres, so depth of talent may be the issue. Cost is definitely on par, or lower than India."

Mike: "I might have considered London or some other European site with low interest rates, low(ish) salaries, and large pool of workers."

Me: "Interesting, there is a lot of buzz around Poland at the moment. London I would have thought, would have been v.expensive, it does, as I said, depend on a lot of factors, like: English language skills, which might rule out a lot of places, Money, Talent, Availability, Brazil is another hotbed, but Language is a barrier there, if English is a must for you.

Mike: "London would have been significantly cheaper than Melbourne. Portugal would be a good place too. Example salaries from payscale.com for software engineers: Australia- $AUD 72800, UK, $AUD 55,000. Portugal would also give you access to those Brazilians"

Me: "Wow, that is quite a difference isnt it. Yes, Portugal was mentioned, also possible to lure expats from the UK too. For agile experienced engineers we also know Melbourne and London would be significantly higher than the country average."

"We’ve done pretty well to secure the quality of engineer we have, it just has taken longer then those first involved would have expected, given the ‘shake a tree, engineer falls out’ promises"

In Bangalore, companies find it hard to stand out, especially relative unknown Australian product companies. Theres a lot of competition and most of the big players are here, Google, Microsoft, Amazon are household names, which is a huge draw"

Mike: "But, if you were going to do another startup in India then (as we have discussed) why not Goa?"

Me: "Well, I think in hindsight, and if I was doing it, yeah, that might be a good idea. I'd be happy because I love Goa. As an alternative location it could be a real draw for young techies in India. India has taken to beach holidays late, but, wow, we're taking to it with a vengeance now! Goa is a real lifestyle destination now, without the traffic and chaos of the big cities, but with the added attractions of sand and surf"

Finally, Craig chipped in: "MBAs are taught a standard model for offshoring thinking. It includes basic things like:

- IT/Network Infrastructure

- Size of talent pool

- Public transport and liveability

- Political stability, levels of corruption

All these simplistic evaluations will end up with all the MBA analysts heading in the same direction. What you should be doing is zigging while they all zag. That way you get the cream of the crop in the other locations; London, Lisbon, etc... AND you miss out on the heated competition, you can be a special premium brand etc."

Do we look back with regret here at Aconex, no, definitely not. We've been through the early stress of slow hiring, but developed an understanding of the market and applied liberal does of patience. With this we've built a great team and are gaining a foothold in this market.
Would I recommend Bangalore to another Australian company, as Mike asked earlier, OK, I'll finally answer, Yes, I would,  however  I recommend they go through my checklist and also assess other more 'left of centre options, besides, all the best talent is now at Aconex!

Note: Those of you late to the game, for context, you're going to have to go back and read parts 1-3, go on off you go, we can wait for you. Part 1, Part 2 and Part 3 are here for your reading pleasure.