August 17, 2022
What is the BOT Model? Build-Operate-Transfer
When you start fresh or expand your business in a new country, every part of it will be tedious and requires undivided attention. To keep the company from exhausting due to the overwhelming tasks they have to accomplish to have their business successfully run, many choose to use the BOT model, especially in Software Development.
What is the BOT model?
BOT stands for Build-Operate-Transfer. Just as the name suggests, in this model, the offshore provider will build a department, operate the team remotely for a predefined time, and then transfer all of it to you. In Software Development specifically, the IT department will be established, optimized, and operated before it is transferred to you. So essentially, what you receive is a department with trained professionals ready to start contributing to boosting productivity, promoting collaboration, and many more benefits that come with a strong IT department.
Stages of the BOT model
There are three main stages in the BOT model. The process can take up to a few years before it is completely transferred to you, but high quality often comes with a long wait. Let’s dive into the stages to better understand what goes on and what to expect.
At this stage, the offshore partner will deeply analyze your business needs to understand your goals, technical requirements, as well as company culture. After that, your offshore service provider will begin working to find and secure talents, construct a dedicated working space, and install infrastructures such as IT devices, the Internet, computers, and so on. At the same time, they will be working to put together an administration with legal frameworks to make sure you can operate legally in this country. Generally, this stage can be completed in a few months.
This is when the managing stage begins. Your outsourcing partner will take care of all daily activities, develop any project depending on your project requirements and goals, as well as handle the development of products, management, enhancements, maintenance, and product support. Your future team will grow together in a work environment and company culture similar to yours to easily integrate during the next stage. It usually takes 1 to 2 years to establish a fully functioning development team.
During the transfer stage, the outsourcing partner will legally transfer the team as the subsidiary of your organization, and any project ownership, operations, intellectual property, knowledge base, and other assets that follow. The transfer phase can come earlier if the client decides they are ready, which is when they buy the whole operations and complete the contract. There are also cases where this phase occurs later due to several possibilities.
Why Outsource Build-Operate-Transfer
It may be tempting to just do everything on your own and not rely on the outsourcing partner, however, there can be a lot of reasons to outsource the BOT model, and here are a few.
Saves money and time
After you’ve chosen your destination country, the next thing you worry about is learning geography, understanding the market, and all the other things. If you take your time to do this, and then learn to build a talent base in that country will take up so much of your time. Taking on the alternative, you can put that time and energy into other aspects of expanding your business to ensure all of the input translates into promising profit in the future. In the long run, it will be more cost-efficient to outsource.
Lower stress level
There is no doubt this process will become overwhelming and in turn, will demotivate and slow down or even destroy the process. Carrying everything by yourself can be heavy on your shoulders. By smartsourcing to an experienced partner and gaining an extra helping hand, you can now meet business targets with ease on time and often within your budget. Outsourcing can still be stressful for a bit at first, but once the rhythm flows, you finally get to catch a break.
One of the biggest advantages of outsourcing a BOT model is usually because of their professionality and expertise. They have managed, set up, and administered operations countless times, so choosing to partner with them can minimize your risks and find growth directions that you may have not thought of, especially when venturing into a completely new market.
Benefits of the BOT model
You’ve read what the benefits of outsourcing are, but what are the benefits for the model itself? There are so many to name such as putting products on the market faster, cost saving and profitability, minimized risks, logistics, ready resources, rapid scaling, and new technologies. You’ve heard it! You can procure all of the business activities and operations within the agreed time frame so rest assured that your business will have everything in place at the right time that you need it. BOT also allows you to flexibly convert offshore teams to different projects or tasks as needed. Plus, you will get the local knowledge as a bonus!
Keep in mind, that not every project and outsourcing initiative works well with the BOT model. Our consultants at Dirox will gladly receive your call and answer any questions or let you know if this model is right for you or if there is a more common way to approach it.
But if you are sure you want to proceed congrats! We hope that you will reap the benefits from this model and get your business to run as smoothly as any long-standing corporations in the target country.
If your offshore country happens to be Vietnam, one of the fastest growing economies in the world, Dirox can be a great solutions partner for you. Our expertise in development and years of experience working with clients from various countries and fields has given us the confidence to guarantee you delivery on time, on budget, and on quality.
Consult with us to learn more about smartsourcing your project to Dirox!