Length: 15 pages  
Sudin Apte August 3, 2006
Offshore Product Development Has Arrived
by Sudin Apte
with John C. McCarthy, Ronald J. Furstoss


This is a document excerptEXECUTIVE SUMMARY

Product development — though small in size — is one of the fastest-growing segments of the offshore services market. As companies across a range of verticals, from aerospace to medical instruments, grapple to add more value-added software to their product while cutting their overall research and development (R&D) costs, this offshore segment will expand dramatically. Its unique requirements mean that it will develop separately from traditional outsourced IT work. The overall offshore product development market will consist of three different segments: 1) R&D and embedded, 2) classic engineering, and 3) software. However, taking product development offshore is not a quick fix for firms. The organizational resistance, the hurdles to running a successful captive, and the process investment needed to manage third-party work half a world away dictate that firms plan a three-plus-year migration.

TABLE OF CONTENTS

NOTES & RESOURCES

itemTaking Product Development Offshore Gains Momentum

itemProduct Development Is A Specialized Field Separate From IT Services

itemOffshore Product Development Has Three Separate Segments

itemVendor Landscape Reflects Segmentation And Specialization

itemHow Users Should Approach Offshore Product Development

itemCaptive R&D Centers Are Not The Universal Answer

itemFirms Will Adapt Hybrid Captive And Third-Party Strategies

recommendations

itemFirms Must Get Their Internal House In Order Before Going Offshore

alternative view

itemIndia May Face Acute Skill Shortage

Forrester interviewed more than 20 vendor and user companies, including Bosch, Cisco Systems, HCL Technologies, Infosys Technologies, KPIT Cummins, Larsen & Toubro Infotech, Motorola, Ness Technologies, Patni Computer Systems, Persistent Systems, Sasken Technologies, Siemens AG, Symphony Services, Tata Consultancy Services, and Wipro Technologies.

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itemNear-Term Growth Of Offshore Accelerating

May 14, 2004, Trends

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Analyst: Sudin Apte
Technology: IT Services, Packaged Applications, Product Life-Cycle Management, Systems Integration
Geography: Asia Pacific, Europe, North America

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