Build Operate Transfer

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The world of IT outsourcing is constantly evolving. Multinational corporations undergo many challenges in navigating through disruptive market forces and rapidly changing needs of their enterprise infrastructure. They need to explore innovative outsourcing models that strike a balance between in-house developments of capabilities and leveraging of external expertise of an offshore vendor.

In traditional outsourcing, a dedicated team model is well-recognized for reducing costs and increasing service levels while enabling a company to focus on its core functions. Offshore developers work exclusively on your project, and once your association with the offshore service provider comes to an end for whatever reasons, all of the expertise and gained by the resources is at a risk of being lost. Rebuilding such expertise again takes a lot of time and is cost-intensive.
However, there is a hybrid service delivery alternative—the Build-Operate-Transfer (BOT) model. In BOT, a company takes advantage of a local partner with a proven track record and experience to stand up, stabilize, transform, and eventually transition over the captive center of self.
The BOT approach can bring market-leading expertise and allow an organization to acquire new capabilities. The organization retains control over the resources and their expertise, and own the assets after transferring over the team.
What Is A BOT In Software Outsourcing?
  • According to Gartner IT Glossary, Build Operate Transfer (BOT) is a contractual relationship in which an organization hires a service provider to set up, optimize and run an IT or business process service delivery operation with the contractually stipulated intent of transferring the operation to the organization.
  • BOT, as a hybrid model, combines elements of the “build” option (that is, “insourcing” or captive center) and the “buy” option (that is, outsourcing; see also “captive centers”).
  • The company enters the Build Operate Transfer (BOT) engagement model, as it aims to accelerate the time required to develop and scale up an offshore software delivery center in a new geographic location at a time when up-front costs would be difficult for executive management to prioritize while leveraging the expertise of a delivery partner operating in that particular geographical location.
  • Companies that are engaged in outsourcing but now striving to achieve a higher level of control over operations, implement a BOT model with a focus on installing a management layer of internal employees to enforce effective controls and compliance over the offshore delivery center as per their own policies.

Phases Of The BOT Model

The build-operate-transfer (BOT) model in offshore software development follows three main phases: build, operate, and transfer. These phases are done as the unit grows, evolves, and prepares for the organization to take over.
Phase 1: Build
  • Requirement Gathering and Business Analysis : The build phase starts with analysis of the Client’s requirements, vision, sourcing goals, technical requirements, and company culture.
  • Contractual Relationship : The offshore service provider sets up BOT contractually. Designs the operating model, finalize a service catalog, and determine the captive center’s technology and workplace needs.
  • Building Exclusive Office & Infrastructure : Assigning clients exclusive office space as needed with robust technology architecture, handling payroll and other local administrative tasks, helping clients build everything from the ground up.
  • Dedicated Offshore Development Team : Fast-track hiring by selecting from pool of carefully-screened talent pipelines; to build a team of highly-skilled offshore developers that match the requirements.
  • Confidentiality : NDAs at a company and each team member level.
Phase 2: Operate
  • Leveraging years of experience, offshore service provider focuses on completely managing the offshore development team.
  • During this phase service provider’s main objective is to achieve a steady state of operations, standardizing operating procedures and continuously improving processes to meet service-level agreements and ensure timely deliverables.
  • Manage faster knowledge transfer to the offshore development team, to ensure it is well integrated and aligned with client’s processes and culture.
  • Accelerate the attainment of modernized capabilities and help enable a more scalable, flexible, and digital enterprise.
Phase 3: Transfer
  • During this phase, the fully operational new offshore development center is ready to be legally transferred.
  • The entire offshore center is transferred over to the client’s india subsidiary (including resources, intellectual property, if any, assets, infrastructure, etc.)
  • Optionally Set-up Client’s Indian subsidiary. QualEx also helps the client to set up a fully-owned Indian subsidiary and complete all necessary registrations or approvals.
  • The success of the BOT model is largely determined by the success of the transition; ensuring the service provider has a proven track record is critical.

Why Consider A Build-Operate-Transfer (BOT)?

Organizations consider the BOT model as it offers the ability to acquire essential business capabilities and the advantages of outsourcing without sacrificing control, time, and resources to build on your own.

Local Knowledge

It is helpful for companies building an international business to acquire an offshore partner’s knowledge of a foreign market to navigate foreign government obstacles and cultural barriers.

Talent Acquisition

Use Offshore vendors’ brand recognition as a preferred employer and mature hiring process capabilities that attracts and retains excellent talent in a region.

Transformation Experience

Leveraging years of experience as an offshore service provider, which can accelerate both jump-start transition plans and optimize specific processes to the attainment of modernized capabilities.

Transparency With The Delivery Center

Transparency

BOT helps to maintain transparency over operations, and security while benefiting from the innovation and intellectual property acquired with the help of an offshore partner.

Sourcing Strategy & Culture

Find the best sourcing strategy between in-house and outsourcing. Get a development team that has a greater understanding of your business and culture, and aligns with corporate and existing talent. And preserve the perception of in-house through best practices, values, and communication frameworks by personalization and branding right from the start.

Hassle-free Transfer

BOT is a contractual relationship with an offshore partner entered into at the start of the project. It ensures complete hassle-free transfer of the captive center and other operational responsibilities to the organization.

Shift The Risk, Uncertainty & Costs

Lower Risk

BOT shifts the up-front foreign government regulatory & cultural barrier of developing a captive center on your own and it contractually guarantees transformation benefits.

Lower Cost

Building a subsidiary in a foreign country is time and capital-consuming. BOT model outsources this work to an offshore partner and then transfer the center to own subsidiary once it is ready.

Time & Effort

The BOT model enables flexibility to quickly scale up or down, within a contractually agreed-upon time frame to meet aggressive time-to-maturity and cost-of-transformation goals.

What do clients say about QualEx Systems?

“QualEx Systems played an important role in the setup of the offshore development center in Pune. Our engagement was a Build-Operate-Transfer (BOT) model. Also assisted us in a smooth transition after the CloudSimple acquisition by Google.”

Maurilio Cometto Director of Engineering, Google

“I have had a number of experiences with offshoring in India, the engagement with QualEx and Viru stands out as a highly successful, very professional, and productive relationship. Build a team of extremely capable offshore software engineers from zero to nearly 60.”

Stephen Haworth Software Development (Director), Seagate Technology

“QualEx was instrumental in the initial success of Courion's operation in Pune, India. Viru provided the space, recruiting, IT, and back office support that we needed while we bootstrapped our technical team and helped us establish local connections when we required our own space and support services.”

Tim McAlice VP of Development, Courion Corporation
    Frequently Asked Questions (FAQs)
    At A Glance: How We Setup your ODC
    • If your company is planning to open a subsidiary / an offshore development center in a foreign country, instead of outsourcing the work and want to quickly build but don’t have any local exposure/experience. Leveraging an offshore partner’s knowledge to help navigate foreign government obstacles or cultural barriers.
    • If you do want to open a subsidiary in future, but are not sure how it exactly works and need time, this is a best stepping stone towards it
    • Whether offshore vendors have brand recognition and mature hiring engine & flexibility to quickly scale up or down.
    • Whether the offshore service provider has infrastructure, facilities and other abilities to start and host a new offshore development center
    • Whether offshore vendor has a track record of previous successful BOT engagements, preferably with renowned corporations.
    • Whether the management have experience of the BOT and is keenly involved in the betterment of the client’s relationships
    • Individual phase pricing: Each phase of the BOT is priced separately. The client can be offered a fixed or time-and-materials based for the initial phase, until the transfer of assets. The remaining phase price is decided after an initial operating model is laid out depending on a client’s business objectives.
    • Outcome-based pricing: To mitigate risk for the client, financial responsibility cab be aligned with the achievement of milestones.
    • Ease of Transfer: Having a clear clause describing terms and conditions of the Transfer phase helps a lot.
    • At the project commencement client is assigned an exclusive facility at offshore vendor’s premises till the client moves out to their facility at a later date.
    • Location facilities selection can be done as per the Client’s preference
      • Does the client have an existing building?
      • Is there a need or preference to be in a particular Special Economic Zone (SEZ)?
      • Is there a need to lease or improve existing space?
    During the BOT project, QualEx helps the client to set up a fully-owned Indian subsidiary by completing all necessary Government registrations or approvals. QualEx also manages the completion of Payroll, Accounting, Recruitment, and operational responsibilities. And ensures a complete hassle-free transfer/handover of the offshore team to the new Indian subsidiary of the client.
    Why Qualex Systems?
    QualEx Systems has been in offshore software product development since January 2000. It is led by highly experienced management who have experience in USA and India.
    QualEx Systems is a bankable offshore partner for multinational companies to set up and manage a dedicated Offshore Development Center (ODC), Build Operate Transfer (BOT) projects, custom software development services, and technology startups as a business incubator in Pune, India.
    QualEx Systems have handled Offshore Development Centers (ODC), and Build Operate Transfer (BOT) for many leading US and UK Corporations. We set up, build an offshore team for you, manage/operate it, and hassle-free transfer it, partially or entirely, after a specific duration, based on the initial agreement.
    We are the best company for BOT engagement models having done this multiple times for world-leading corporations like EMC, Google, Seagate, VMware, and Courion to name a few.
    Leverage the latest technologies and our strategic expertise to build products that redefine innovation and intelligence with QualEx.

    Our offshore software development teams always connected dots across ecosystems.

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    Do you have any questions about the Build Operate Transfer (BOT) model? Get in touch with us. We have experience in setting up offshore captive centers in India for multinational corporations and will be happy to help you.