Typical Percentage Breakdown of Offshore Cost

Estimating offshoring is always interesting, especially when we have seen the the stronger dollar buy about 26% more in Indian currency over the past few months.  But what do we get for the dollar.  Offshoring is an important source of IT talent for the US.

I thought  Don O’Neill‘s breakdown of the cost of offshoring was interesting since is showed a similar distribution of costs from offshoring and organic development.

• Wage Rate    42%
• Communication System     5%
• Physical Infrastructure and Support   17%
• Transition and Governance     8%
• Resource Redeployment     3%
• Resource Redundancy     2%
• Training and Productivity     10%
• Disaster Recovery & Business Continuity   5%
• Advisory Services     2%
• Travel costs      3%
• Exchange Rate Changes     2%  
  

Related posts:

1. New SEER Labor Rate Calculator: A Leap Forward in “Should Cost” & “Will Cost” I saw a demo today of our new labor rate calculator.  It takes in various labor rate drivers and computes...
2. Cost To Recover from an IT Business Interruption Aberdeen group published some interesting information regarding the time and cost to recover from business interruptions.  This is the time...

Comments

One Response to “Typical Percentage Breakdown of Offshore Cost”

1. Totok on February 3rd, 2009 11:53 pm

   Anybody have reference about the typical cost breakdown for entire project from Feasibility Study until Construction Cost.
   How much % the F/S Cost or Engineering Cost compare with Total Construction Cost?
   Thanks

Leave a Reply

Name (required)

Email Address(required)

Website

• Subscribe to this Blog

  Enter your email address:

• Twitter

  Follow Dan Galorath on Twitter.

• Galorath Library

  Galorath maintains a rich library of webinars, presentations, whitepapers, and demos. Register to read our entire library.

• Recent Posts

  • Galorath / Reifer Team To Provide Large Project Success Via Risk Assessments
  • The 6 Characteristics of Effective Metrics
  • FPGA Sticker Shock
  • 2012 Defense Strategic Guidance Summary
  • Cost Readiness Level (CRL) Establishing Cost Risk Based On Engineering Decisions
  • APMP Cost Task Force Industry / Government Questions & Responses
  • New SEER Labor Rate Calculator: A Leap Forward in “Should Cost” & “Will Cost”
  • Frank Vogelezang Pricing Vs Costing & Proof That IT Systems Can Be Estimated
  • APMP Cost Taskforce November 2011: Helping Calm the Storm of Budget Cuts Via Cost Analysis
  • CMMI and SEER Applicability: Estimation, Planning & Control Processes and SEER Integration

• Categories

  • APMP
  • business value
  • CEO
  • Conferences
  • Cost Estimating
  • costiq
  • Design for Manufacturing Estimating
  • earned value
  • Estimating
  • Estimation Process
  • General
  • Hardware Electronics Systems Estimating
  • IC Estimating
  • IT Estimating
  • Lists
  • measurement
  • Presentations
  • Project Management
  • Risk
  • Software Estimating
  • Software Sizing
  • Systems Estimating
  • Systems of Systems Estimating
  • Ten Step Project Estimation Process
  • Thoughts

• Recent Comments

  • Real Estate Agent on Evaluating the Benefits of Service Oriented Architecture: SEER in support of SOA Implementation Decisions
  • Henry H on Software Project Failure Costs Billions.. Better Estimation & Planning Can Help
  • Dean on Packaged Applications – The Hidden Cost of Snake Oil
  • Lee Fischman on FPGA Sticker Shock
  • Implementing ERP more effectively – Part 3 « The Manticore blog on Software Project Failure Costs Billions.. Better Estimation & Planning Can Help

• Galorath Company

  • Galorath International
  • Galorath.com

• SEER sites

  • SEER for Hardware, Electronics & Systems Project Management
  • SEER for IT – IT Project Cost Estimation
  • SEER for Manufacturing – Project Estimation
  • SEER for Software – Software Estimation

• Project Prediction Infographic

  > click to view <

• Meta

  • Log in
  • Entries RSS
  • Comments RSS
  • WordPress.org