GLOBAL SOFTWARE DEVELOPMENTBy Logan Thiem

Global Software Development• What is it? (GSD)• Work done across national

boundaries• Involves:

• Communication• Coordination• Control• Infrastructure

Why Global Software Development?• Most Common Reason:

• Cost Saving• Insufficient resource available

• Recent Reasons:• Remain Focused on Core

Competencies• Gain access to world-class

capabilities

History• “If a foreign country can supply us with a commodity

cheaper than we ourselves can make it, better buy it off them with some part of the produce of our own industry employed in a way in which we have some advantage.”• Adam Smith’s “The Wealth of Nations’ in 1776

History: Phase 1• Phase 1:

• Texas Instruments R&D center in 1985• First multinational captive center in India

• Captive Center: An operation that is owned by an offshore company. The activities are performed offshore but are not outsourced to a third party.

• Deutsche Bank and Citigroup in 1992 in India• IT and business process services

• Samsung in 1993 in Moscow

• 21 captive centers in 12 years• Vast majority in India

History: Phase 2• “Came to India for costs, stayed for quality.”

• Head of operations for Dell India

• Range of offshore services expanded • Due to “General Electric Effect” in India

• HP, IBM, Verizon, LG• 66 captive centers in 5 years• Rise of R&D in China

History: Phase 3• “It has been said that arguing against globalization is like

arguing against the laws of gravity.- Kofi Annan, Statement of the former Secretary General of the

United Nations

- Shell, JP Morgan, Royal Bank of Scotland- Outsourcing is now mainstream- 137 captive centers in 3 years

Benefits

Mechanisms used in GSD• Centralized Structure• Early Identification of Dependencies• Documentation• Periodic Commits• Daily Builds• Periodic Meetings

Issues

Issues• Strategy• Communication• Coordination• Managing Cross-Culture• Etc.

Strategy• When?• To Whom?• How?• What?

• IT Support• Application Development

• Where?

Communication• Distance

• Power Distance Index

• Click me!

Communication• Time Zone Difference• Infrastructure Support

Communication• Type

• Informal• Formal

• Synchronous• Phone, Video Conference, etc.

• Asynchronous• Email, Voice-mail, etc.

Communication• Group Awareness

• Explicit• Consequential• Feed Through

Coordination• Lack of Flexibility & Integration• Poor Role Support• Lack of Informal Communication

Culture• High Context vs. Low Context• Poly-chronic vs. Mono-Chronic• Must be understood and Respected

Managing Cross-Culture• Reduce Cultural Distance• Reduce “Virtual Distance” Via Communication• Recognize Limits

Risks• Global Software Development taken too far:

Risks

Risks• Hidden Costs

• Additional Charges• Decreased Flexibility

Statistics

Questions?