"Hierarchy is important," says Botticelli, VP of engineering in the mobile solutions division at Trimble, which makes software for devices used by delivery people and other mobile workers. "The project manager needs to go home and tell his wife he has 14 people working for him."
Trimble eased its way through these cultural challenges three years ago by hiring Chinese outsourcer Suzsoft to provide engineering services. This is a path more U.S. companies are likely to follow, making companies like Suzsoft--now DarwinSuzsoft since being acquired by Darwin Partners last year--increasingly popular.
Some of ArrAy's 200 engineers in Guangzhou
It's not just the small services providers gearing up: IBM, Tata Consultancy Services, and others have plans to hire thousands more engineers in China. Oracle late last month set up a second Chinese development center to support software partners and integrators, and introduced a computer science program for vocational schools in a deal with the Chinese government.
Companies doing offshore development in China say they're paying salaries that are 25% to 40% lower than what they'd pay in India, without the high staff turnover rates in that country. Chet Gapinski,VP of engineering at Crossbeam Systems, a maker of security systems, steered his company to China last year after facing some of those problems in India. Crossbeam hired ArrAy for a "hybrid" approach that keeps project managers in the United States and engineers in China, with both sides making regular visits to the other country.
Crossbeam initially had difficulty getting U.S. visitors' visas for Chinese engineers, a problem ArrAy smoothed over, Gapinski says. It also found that Chinese engineers can't work on some security technologies deemed sensitive by the U.S. government. In China, experienced service providers also can prevent problems dealing with government, which is closely involved in business.
Trimble, which employs 30 of DarwinSuzsoft's Chinese engineers, has expanded its relationship beyond developing custom apps for a Hong Kong customer to include maintenance for U.S. and Chinese customers and development work on Trimble products.
Botticelli initially was concerned about lax intellectual property protection in China but found Suzsoft's security measures more than adequate. English skills aren't nearly as good as in India, so Trimble requires its Chinese engineers to attend weekly English classes. One sign of success in China: Trimble plans to ramp up its team there to handle new products coming out next year.