How global sourcing helped GN Otometrics improve capability, flexibility and capacity of R&D.

About GN Otometrics A/S:
GN Otometrics is the world's leading manufacturer of hearing and balance instrumentation and software - innovative concepts designed to help healthcare professionals make the best possible decisions.

In 2004, GN Otometrics initiated a strategic move of setting up their own Development and Test group in Ukraine in close collaboration with KRING Technologies. This decision has helped GN Otometrics achieve its goal of significantly improved capability, flexibility and capacity.

GN Otometrics’ main reason for turning to offshore development was the lack of Danish software developers with the appropriate level of qualifications and motivation:

“One specific software platform of our portfolio was based on the 4GL GUPTA/Centura development tools, which seemed to become increasingly difficult to recruit developers for - especially since we faced a pure maintenance situation. However, KRING managed to identify a core team of experienced developers in Ukraine who possessed the required competencies and motivation for the job.”
- Uffe Bjerg, VP R&D at GN Otometrics.

The Danish development and test team working on this specific software platform was replaced within six months. Remarkably, the new offshore team - consisting of ten developers and five testers, a local offshore project manager and a product architect - delivered the first release after a mere seven months, and the desired quality level was achieved at the second release only four months later.

“After a dedicated effort during the first eight months, we managed to establish a highly competent team in Ukraine, and the high level of qualification within the team brought us even further in terms of capability maturity.”
- Uffe Bjerg, VP R&D at GN Otometrics.

The positive outcome of the initial experiences led to decisions to increase the capacity of the onshore QA Test Group.

“With the success of the established development and test team, it was clear to us how to increase the flexibility and capacity of the GN Otometrics QA Test Group, and thereby fulfil the increasing need for highly qualified software testers at a low cost. We hired two additional testers to participate in the testing activities of an onshore development project.”
- Uffe Bjerg, VP R&D at GN Otometrics

Furthermore, the success of the project also provided inspiration and confidence to reorganise onshore projects. Experienced onshore audiology developers were reallocated to strategic development projects, whilst offshore developers and testers were made responsible for maintenance projects.

“With the kick-off of a new development and test team of four people, we managed, within three months, to have a highly qualified team running – now with onshore remote project management. Once again, we realised that we improved our ability to predict and plan projects, now even with an increased level of quality of the software. The main challenge we have faced was in terms of transferring our specific audiology domain knowledge to our new developers, but with KRING’s assistance we are equipped to address such problems. 
- Uffe Bjerg, VP R&D facilitator at GN Otometrics

KRING Technologies are happy to be part of GN Otometrics’ offshore initiative, and the success it has brought about.

“At KRING we pride ourselves on being 100% dedicated to each client, and our tailor-made solutions reflect this. We realise that different businesses have different needs, and it is those specific needs that we identify and work towards fulfilling. Through our close cooperation with GN Otometrics, we were able to offer them an offshore solution that has proven to be very successful. We use the term Integrated Sourcing for teams that are seamlessly integrated into our client’s organisation, and who perform under a global delivery model”
- Mikael Munck, CEO, KRING Technologies A/S.

The continuing success of the offshore initiative has made the organization very confident of the approach:

“Looking ahead it is clear that our Kiev people have become important resources, not only on maintenance projects, but we also see them engaging adeptly in strategic development projects.”
- Achim Kitschmann, Vice President GN Otometrics, Product Centre.

Many Danish businesses currently face the challenge of recruiting onshore developers, and the offshore team is a way of reducing the risk of lacking resources. Because GN Otometrics has learned to operate with an offshore development and test team, the company has increased the flexibility of software project planning, but at the same time improved its ability to operate in the dynamic world of software development.

From start to finish
The two major hurdles, which many outsourcing projects face, are establishing a proper infrastructure offshore without actually being present in the country, and managing across language and culture barriers. KRING Technologies provides an experienced consultant with bilingual and multicultural skills to be responsible for communication, management, travel plans, troubleshooting etc.

Relationship management
During and after the transition to the offshore teams, relationship management has been a key element in the success. From the very beginning it was emphasized that new people coming on board the GN Otometrics team should feel that they became important components of the business. Several kick-off visits by the Danish team to Ukraine were arranged, and more than 50% of the offshore team members have travelled to the GN Otometrics headquarters in Denmark on visits varying from a few days to four weeks.

During these visits it has been a priority to arrange activities to establish good personal relationships, e.g. 1:1 meetings and social events. As part of the team activities, company and personal value exercises have been performed to establish a better understanding between the teams. This has proved to be important in order to minimise the effects of potential cultural differences and misunderstandings. KRING Technologies has played a crucial role in organising the visits and assisting throughout the process.

Communication as the key
During the recruitment phase, good written and spoken English was an important criterion, and has proven to be of essential value to the process. A well-organised daily and weekly communication arrangement between the Ukrainian developers and testers and the GN Otometrics office in Taastrup ensures that the objectives laid out by the management are adhered to. Furthermore, the good English skills of the team enable flexible and easy communication between all members of the teams.

“Today KRING Technologies is reaching out to our ambition of becoming the ‘pound-to-pound’ best and most efficient offshore software provider around.  Our commitment to our clients is to work on individual, integrated sourcing solutions, while continuously enhancing our - and our clients’ - operational efficiency and quality in all aspects of the development and delivery process.
- Mikael Munck CEO KRING Technologies.