ABSTRACT
The core reason for running an offshore center is to lower company costs, by offshoring projects to the low-cost location of the offshore center. However, some companies make all their decisions for the offshore center driven only by the cost-reduction factor. This chapter suggests that companies should strike a fine balance between the cost reduction expected from the offshore center and the need to invest in strengthening the offshore center teams to maximize their contributions to the companies' revenues and profits. Companies should never try to reduce costs at the expense of compromising the delivery capabilities of the offshore center. The offshore center management should be given the flexibility to exceed the mandatory constraints on the cost savings expected from the offshore center to make higher investments in capacity building its staff. Such investments result in much higher revenue generation and cost savings from the offshore center in the long run.
