There are a range of offshore IT development options for healthcare vendors and organizations seeking to develop new products and services.
On one end, outsourcing to a third-party service provider offers solutions for project-based development. This option requires the company to commit the least amount of resources. It also minimizes the amount of control the company can place on processes. The model can be ideal for non-core projects.
On the other end of the spectrum, companies can develop captive centers—offshore subsidiaries of their IT operations. This allows for maximum control of processes, but requires the most resources and patience in establishing the operations that enable a long-term presence.
For healthcare companies, there is a third offshoring option ideally suited to their needs. For situations where a company needs to rapidly address market opportunities or regulatory obstacles, the virtual captive model combines the key advantages of the other two options: a blend of control and flexibility. In many cases, virtual captive leads to a transfer of ownership—a captive center owned by the client—after an established period of time.
The growth of healthcare IT outsourcing is gaining momentum. TechNavio predicts an 8.6 percent compound annual growth rate in this trend through 2019, and the Everest Group sees it as a $68 billion market by 2020.
How do you get the most out of virtual captive? Set up is more intensive than a traditional third-party service provider relationship. There are shared risks and shared accountability for outcomes with virtual captive. Two of the key factors for success in a virtual captive model include the involvement of senior management and exceptional communication with the virtual captive provider.
If you’re looking for an offshore solution, virtual captive may be for you if you have needs for:
- Eventual ownership and significant control
- Access to capital
- Rapid time to market
- Access to high-quality skills and healthcare IT knowledge
Benefits you can expect to accrue from a virtual captive solution include:
- Tight alignment with your organization’s processes and culture
- Intellectual property protection
- Accelerated start-up time and return on investment
- Reduced risk from greater operational control
- Flexibility in the level of involvement and shared responsibility with provider