Advantages of the Build, Operate, Transfer model
You might not be aware but, Build, Operate, Transfer (BOT) is a model used to settle a contractual relationship, as Gartner says, where a company hires a service provider to optimize and run an IT or business operation for a specific period to transfer the operation at the final stage once the company gets constituted.
Although this model is becoming more popular in the tech industry, it is important to keep in mind that it’s not as simple as it seems. This process requires full transparency, flexibility, and open communication at every stage. They must completely inform the client about the performance. As well as all the steps taken by the provider: recruitment, legal formalities, timing, projects, location, etc.
In today’s blog, we’re going to talk about what are those factors that make this model so appealing to companies desiring to constitute a new market.
- Scaling up teams
- Tapping into new talent pools
- Gain nearshore development operations in an agreed timeframe
- Transparent communication
- Reducing risks and cost control
Scaling up teams
Every project is specific and needs a team composed according to the special requirements. As a result, with the BOT model, you can scale up a team of professionals specialized exactly for your needs. The service provider ensures finding the best of the best in a known environment.
Tapping into new talent pools
Not knowing how to enter a new market is a common feeling for companies wanting to expand operations. But not doing extensive research on the market due to cost arising is one of the most common errors. Bureau Labor Statistics show that approximately 20% of new businesses fail during the first two years of being open, 45% during the first five years, and 65% during the first 10 years.
Therefore, having a local partner with entirely local knowledge of a market is going to pitchfork your business abroad. The opportunity of not having to worry about local laws, cultural miscommunication, and the management of regulatory consent in some countries will make a difference.
Gain nearshore development operations in an agreed timeframe
BOT guarantees you’ll recover the operations management in a specific time. Meanwhile, the assets are being controlled by an external company, you still can start preparing to take responsibility for the IT operations when the agreed period expires. It could be three months, six months, or three years according to the established terms of service. It´s time defined by the client.
This outsourcing engagement model enables you to gain flexibility in your operations. This means having the advantage to adapt easily to a customer’s needs or even recruiting resources faster than having an in-house operation. Also, nowadays, everything changes fast. That’s why its appliance permits you to be ready and open to change at any moment. Aren´t the advantages of the Build, Operate, Transfer amazing?
Another reason to choose it is the level of transparency. It ensures open communication at every stage of the process and maximum operation control over your nearshore team. Thus, to ensure the teams and projects are taken with the same process as they are in the headquarters. It allows you to make rules to ensure alignment at the transfer phase.
Every salary, cost, and even position offered is informed to the main company. Since the local provider explains everything that’s happening in the nearshore location. For example, feedbacking the salary structure and legal particularities to the service acquirer. They communicate everything each month to secure success in the new location. So that when the transfer phase begins, the corporate culture, costs, and many other aspects pair with the one from the principal offices.
Reduced risks and cost control
As mentioned before, having a local partner to run the IT operation reduces the risk of failing in a brand new market. And of course, minimizes your initial costs of recruitment and setting up the office. As well as, considering that nearshore outsourcing in Latin America, the prices are lower than in other regions. Because the workforce has strong language skills, full studies and their work costs less than it would be in other parts doing the exact task.
To conclude, the Build, Operate, Transfer model is one of the best options if expanding abroad with low-costs (related to the facilities establishment) and experience makes part of your goals. This type of outsourcing model is also perfect for companies wanting to establish a nearshore software development team with the assistance of a partner to constitute the company while it enters a new market or while it gets prepared to manage the operation on its own. If you´d like to learn more about the advantages of the Build, Operate, Transfer, contact us.
Read more about BOT
BOT: Access new talent pools
IT Staff Augmentation market
Nearshore outsourcing advantages