FEATURE: JOB TURNOVER AND ITS CONSEQUENCES 54 IEEE SOFTWARE | PUBLISHED BY THE IEEE COMPUTER SOCIETY 0740-7459/20©2020IEEE ALTHOUGH OFFSHORING PROJ- ECTS are challenging, they promise the benefits of competitiveness, gaining access to large labor pools, and lower- ing development costs. As a result, glo- balization of software companies and their partnerships continues to grow. 1 The success rate of distributed offshor- ing projects, however, remains low, and the realization of expected benefits is often debated. 2–7 Previous empirical studies report that quality and perfor- mance problems are usually caused by the underestimated complexity of the work, gaps in competences, the large amount of time required for acquiring the necessary knowledge at a newly es- tablished site, and high employee turn- over. 5–7 Turnover and its consequences in offshoring collaborations is the focus of this article. Based on two recent in- dustrial cases of offshoring to India, we empirically demonstrate that turnover, especially the retention of engineers in the first two years of employment, is a real challenge and share practical rec- ommendations for addressing it. Turnover in the Indian Software Industry India has become an oasis for software engineering since the early years of mil- lennium. 8 India has attracted numerous contracts from large 9 and small 4 cus- tomers worldwide. However, the Asian job market is recognized for its high em- ployee turnover rates 9,10 due to abun- dant job opportunities 2,3 (see “Measures for Capturing Staff Changes” for defini- tions). The average yearly turnover in In- dia ranges between 20–40%. 1,9,10 Turnover is not only an India- specific challenge, it is one of the big- gest challenges to global software development in general. 1 Although some studies report that Europe has lower turnover rates than developing nations, 1 market monitoring reports suggest that turnover is a burning issue The Offshoring Elephant in the Room: Turnover Darja Šmite, Blekinge Institute of Technology Rini van Solingen, Delft University of Technology Panagiota Chatzipetrou, Örebro University // Staffing software projects with engineers from inexpensive locations has become commonplace. However, distributed development remains practically challenging because of recurring problems, e.g., decreased productivity, low quality, and high, unforeseen costs. Although it is often overlooked, one of the main underlying reasons for these challenges is high employee turnover. This might be especially noticeable in developing countries with strong economic growth such as India. This article examines turnover of Indian software engineers and introduces strategies to address it. // Digital Object Identifier 10.1109/MS.2018.2886179 Date of current version: 16 April 2020 Authorized licensed use limited to: TU Delft Library. Downloaded on May 18,2021 at 19:47:50 UTC from IEEE Xplore. Restrictions apply.