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How to Successfully Outsource Product Localization to China

Jacob Hsu - Symbio

Intended Audience: Managers, Marketers, Site Coordinators
Session Level: Intermediate


China is becoming a large hub for technical localization. However, language barriers, cultural differences, legal issues, time-zone differences, and distributed team management issues can still make it challenging for US and European companies to take advantage of China's highly skilled, cost-effective workforce. This session will provide attendees with tips on how to successfully outsource product localization to China, including how to work within a phase- based distributed development project model.

This article will address:

  • Why China?: An IT giant awakens
  • Possible stumbling blocks to working within China
  • Managing a phase-based distributed development team and tracking their success
  • Re-tooling your corporate culture to ensure success


Why outsource localization to China? Because China is emerging as the largest talent pool of qualified and experienced engineers in one of the most rapidly growing technology environments in the world. China has an abundant supply of talented engineers, with almost as many engineering degrees granted in China in 2002 as in the United States. Additionally, over 1/3 of the Chinese nationals that received degrees overseas are returning home, bringing with them not only education, but also Western business experience. Salaries in China are, on average, below that of other major offshore outsourcing centers. And, unlike those in India or Europe, Chinese engineers natively program in double-byte, which can be of critical importance to companies localizing software for deployment in the large (and growing) CCJK market. English language skills are burgeoning in China, with national competitions being held and primary schools holding classes in English. Also, the Chinese government has made amazing improvements in communications and transportation infrastructure, making it easier to do business. They are improving the business environment by reforming taxes, FOREX, copyright and pirating regulations, and banking. They have put incentives in place for foreign companies doing business there.

However, launching a successful outsourcing project in China is not without its challenges. Although China has come a long way politically and improved its technology and infrastructure, it is still a relatively closed society when compared to the United States and Western Europe. China is still largely controlled by government organizations and political alliances. The government has put incentive-based enforcement policies in place, but it remains to be seen how effective the enforcement of trademark and copy write laws will be. To successfully do business in China, it is essential to learn the laws and regulations for trade and commerce. The most effective approach for this market may be to work with a partner/client that is already established in China. If your goal is to leverage offshore labs to lower costs and/or decrease project delivery time, partnering with an IT firm may make the most sense.

If your company has not outsourced localization offshore before, you must first determine if the model works for you. Setting up a phase-based distributed development model (the traditional model for leveraging offshore capabilities) wherein the design/development work is completed onshore and the localization is completed offshore, takes some planning. You might assume that managing distributed projects requires substantially more work than traditional co- located projects. And the reality is that a distributed model is less tolerant of a non-optimized setup that a co-located model might be able to accommodate (typically by employing ad-hoc workarounds). However, by architecting a work model to accommodate a distributed model, you ensure a rigorous approach that will assist the successful execution of projects according to a well-defined set of "best practices," regardless of the execution model employed. The physical separation that is typically perceived as a disadvantage can actually compel teams to clearly define entry/exit criteria for each phase, and actually improve the quality of information available for transfer between teams. In addition, this model takes advantage of the face time of the on-shore team and the cost effectiveness of the offshore team while maintaining quality and decreasing delivery time, since the working "day" is expanded to 18-24 hours.

Once methodological and technical frameworks are in place, the bulk of the remaining management challenges with phase-based models are related to "soft issues", including cultural incompatibility, leadership problems, trust issues and negative competitiveness. These are actually the major obstacles to successful completion of distributed projects. However, there are concrete ways to alleviate these problems, including re-defining your corporate culture, improving project planning, and adjusting project staffing and technical infrastructure.

The major lesson to be learned is that China is becoming a tier-1 source for outsourced software localization. Companies that do their homework will be able to reap the ROI benefits of working in this low-cost market. Companies that ignore China and all it has to offer may find themselves outpaced when their competitors are utilizing Chinese resources to deliver a higher quality product at a lower cost and faster time to market.

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30 May 2003, Webmaster