Should resellers outsource or offshore migrations?

Do you use offshore support to run your business? If not you should consider it, if only to help with implementations. A trend among software companies to provide free or subsidised data conversion services from competitors’ products hints at the potential for offshoring in IT resellers.

Entrepreneurial accountants launched data conversion services from MYOB and Reckon to Xero several years ago. Click2Convert was one of the first and relied on accountants in India to manually re-enter data from one program to another.

Intuit followed suit last year with free conversions from Xero through a Vietnam services company called Odyssey Resources. Odyssey was already converting MYOB (Enterprise and Premier v.19 and earlier) to QuickBooks Online. Odyssey is Australian owned and describes itself as a “mid-tier firm in the provision of outsourced accounting, tax and bookkeeping services to Australia”. 

Last month, MYOB was the latest to join the data conversion club. Convert2MYOB is a spin-off from a Philippines-based business, run by an Australian accountant, which provides back-office services to Australian businesses.

The number of Filipinos and Vietnamese with good English and experience with Australian companies is rising quickly. Telstra alone employs 10,000 Filipinos, mainly to answer billing and other inquiries in its call centres. This is creating a pool of freelancers and outsourcing groups who can take over a range of back-office tasks. 

We are in a time of abundance when it comes to new business software. Software-as-a-service, created with the latest user experience and interface design, is a big step up from desktop software with a 20-year-old interface. Customers’ expectations of their software is also rising quickly.

Another factor is driving the desire to upgrade. It is now possible to sell your software to overseas companies as easily as to Australian customers thanks to the direct delivery model for SaaS. This makes it attractive to create applications for niche industries previously too small to target.

Business owners can take advantage of these applications to improve the efficiency of their companies with off-the-shelf apps designed to fit their niche. However, they still need someone to tell them what is available, show them how it works and help them set it up.

The hassle of data migration can be a major point of resistance for clients with large amounts of data siloed in an older application. Outsourcers give a reseller the ability to offer at-cost or ‘free’ data migration for business application upgrades.   

The great advantage to outsourcing the migration is that a reseller can focus on reaching a return on investment for their customer as quickly as possible. This might be through training staff, mapping software to processes, or helping devise new services based on the technology.

One of the by-products of the consumerisation of technology is that business people also expect software to be easy to use, that it can prove its usefulness within a 30-day trial and be adopted quickly and easily by employees. It’s almost like the virality of smartphone apps has jumped across to the on-premise world.

Database translation will always be with us but hopefully it will become less of an issue. One of the measures of quality for a SaaS program is the flexibility of its API (application programming interface). An app that can share and receive large amounts of data through its API is ultimately more useful than a better-featured program that stands alone.

Cloud software typically places more emphasis on connectability than desktop software for this reason. 

It’s reasonable to conclude that we will spend the next 10 years or so migrating data from desktop and on-premise applications to cloud programs oriented towards sharing. Of course there are plenty of cloud apps that don’t share data, but the expectation is that they do. 

If you are selling business software and are running into hurdles with archaic platforms, outsourcing could be a great way to defuse another objection.

Sholto Macpherson is a journalist and commentator who covers emerging technology in cloud.