US And Global Turmoil : Cost Cutting Will Be Top Priority In Every Sector

Venture Capitalists backing off from investments, many start-ups closing doors as stock market taking a free fall, no one really has answers to where this economic crisis is headed. The problem is even worse for bigger companies as they have a middle management layer that is highly paid and not very productive. The culture of long meetings and slow decision making is going to bring more pressure on top management to ensure that the company stays profitable.

Today everyone is trying to see how best one can improve productivity and at the same time control costs. Obviously, lot of middle level managers and sales people will lose jobs as companies have started cutting back on lot of expenses.

These are indeed challenging times and will even push more jobs overseas as companies try to get the best value for their buck.

My company works in Drupal Content Management System. We provide very cost effective services to global customers. Our clients are spread across US, UK, Canada, Australia, Germany as well as India.

We got indications of the slowdown as early as 6 months back when our financial advisors cautioned us of worse things that can happen because of the credit crisis in US. We quickly adjusted at that time and came up with a low cost incubation business model where we provide qualified dedicated drupal developer at $25/hr. For this we floated 100% owned subsidiary – OpenKick Technologies. OpenKick is our training/incubation division that provides training services in open source technologies to students as well as professionals and also takes up turn key web development projects. We moved 2 Senior resources from Gloscon to OpenKick to help junior resources work on client projects. These resources before working on client projects were put through a rigorous training program and have worked on 1 to 2 internal projects. The advantage of this approach was that we were able to bring down the labor costs and hence offer services at $25/hr rather than $85/hr+ at Gloscon.

If you are running a Drupal site or looking to start a new project in Drupal, you may have to make few choices

– Do I pay $50+/hr (or $100/hr) hourly rates?

– Is or will my hired developer be very productive?

– Does the resources I have got sufficient experience?

– Will I get support when the project phase is complete?

– Who will apply security patches and do upgrades?

– Who is regularly testing my server access logs for security breaches?

– Are there random tests done on my backups to see if the restores work properly?

– Can I get someone as retainer to advise me?

– Shall I focus on being on my business or be in my business?

– I have run into cost overruns, are there better offshore options in India/China?

– Am I prepared to work couple of days a week for late hours to co-ordinate with offshore team?

– Can I start my Company ‘XYZ’ in India/China and put my own team and manage them rather than work with a partner? Can someone help me in Build and Operate the operations and later transfer it to me?

– Can I live with language issues?

Some may not want to outsource while those who are looking at reducing the cost as much as 50 to 70% will seriously be looking at other options.
In times where we are at, everyone has to stretch bit more to keep floating. Cost cutting should be top priority because cash can run out very very quickly.