When asked about any reference for Objectiva as a successful outsourcer in the United States, Tao Ye will tell you about how his company was acquired by a US-based software company that was Objectiva's customer then became its parent company.

Objectiva Software Solutions a software outsourcing company, was founded in 1999 by four enterpreneurs, including two Chinese, all with impressive education and work experience in the United States. It has become one of the few Chinese companies to penetrate into the US software-outsourcing market.

And the company has its own "secret sauce" to enable success.

"Indeed, we are unique, quite different from many Chinese outsourcers," Ye, president of Objectiva, tells China Business Weekly.

While many Chinese companies are concentrating on the Japanese market, "we have exclusively focused on the US market for several years, and now we are expanding into Europe. We have no strategic plans for expanding into Japan," says Ye.

By focusing on the US market, which is the world's most competitive software market, Objectiva has developed excellent capabilties and an impressive record in providing high-end outsourcing solutions consulting, software design and architecture, system deployment, testing and integration rather than just coding and testing, Ye adds.

Official statistics indicate the Japanese market accounted for an estimated 60 per cent of Chinese outsourcers' total revenues last year. Often, the deals Chinese software outsourcers reach with Japanese clients are for lower-end programming, largely due to China's lack of experience in comprehensive project management.

Among the remaining, outsourcing to local Chinese companies contributed approximately 30 per cent. The US and European markets commanded about 10 per cent.

Many Chinese software outsourcers say their absence from the US market is due to limited labour scale, compared with Indian firms, which have between 30,000 and 50,000 engineers. To Ye, however, size is not that important for an initial move.

"We are not a big company. Actually, we are still small," Ye says. "But we have outstanding profitability." He says Objectiva has the highest annual revenues per capita of staff in China's market, which usually ranges between US$40,000 and US$50,000.

"That is because we can hire top talents and keep them, by creating a corporate culture tailored to the business," says Ye. "It's also how we distinguish ourselves from most Chinese outsourcers."

Objectiva's senior engineers, apart from having excellent technical skills, are proficient in English. Moreover, the have Western business-savvy, and they are qualified leaders in managing complex outsourcing projects, Ye says.

"I am highly driven to build the best outsourcing company in China, with the best people. And with these talents, we can conduct high-end outsourcing projects, in which our personnel are trained for the long-term."

In turn, high profitability and top-class people are propelling Objectiva's rapid expansion.

There were just a handful of employees including Ye and his three co-founders when Objectiva was founded.

They were undaunted. The firm had 75 employees in China and 10 in the United States by last June, when Objectiva was acquired by Document Sciences, a NASDAQ-listed software company offering document solutions. Since then, the number of employees has jumped to 189 in China, and nearly 30 in the United States.

The company has maintained a nearly 100-per-cent annual growth rate over the past few years. Annual revenues, which reached US$4 million last year, are expected to hit US$8 million this year, Ye says. "It is very significant growth, compared with that before the acquisition," he notes.

Objectiva is benefiting significantly from the acquisition, both financially and culturally. Moreover, Document Sciences, as a public company, ensures Objectiva's credibility and security, especially regarding intellectual property rights issues, Ye says.

To Jack McGannon, chief executive officer of Document Sciences, the acquisition is "a terrific reference" for (Objectiva's) competency. Objectiva was working on a small, single project for Document Sciences.

"We were so impressed... at that time, we were about to enter software-outsourcing business, so we made a strategic move to acquire 100 per cent of Objectiva," says McGannon.

And the integration has worked well. The parent company's revenues increased 32 per cent, year-on-year, during the last quarter. "There was no collision or conflict in our corporate cultures," McGannon says. "Instead, we shared similar core values with Objectiva."

Despite some comparisons with Chinese counterparts, Ye insists the company, set up in Beijing and headquartered in California, is "globally- oriented."

(China Daily 07/04/2005 page7)