Outsourcing IT Development: Keys to Success

In a past life, we represented an offshore IT Product Development company - and our differentiation was in our processes and methodology. We lost deals due to cost - because for many, cost IS the differentiator. We say this is wrong;  as they say, you get what you pay for. We recall attending a trade show where a competing vendor proudly displayed their cost ($12/hour) right on their booth banner.Would you trust them with your investment capital?

Copying is said to be a form of flattery, ok maybe it's plagiarism. Therefore, please take a look at the Six Ninja's blog article entitled: "Outsourcing software development, managing the risk" for an excellent list of suggestions when considering an outsourcing partner. A few of their points:

"If the price seems ridiculously cheap then somewhere in the chain, compromises will have been made, either in the quality, the testing or the support."

Ensure that your contract provides for schedule payments, and that you have tested and verifying your application to that point before payments are made. In addition, make sure your contract covers each point in this chain - the more detail in writing the better. Lastly, sometimes it is better to pay a premium price for a credible vendor than to save money with an unknown offshore company.

Points 5-7 are all very similar regarding release management, version control, and bug tracking.

It is critical that the offshore partner has the right logistical tools and procedures to manage the development cycle in coordination with your team. This means formal and scheduled code releases (often aligned to a payment schedule), online bug tracking and other non-email means of communication (of specs, changes, material...). A credible partner has the communications and process methodology ready to go - and well documented.

"Find out whether your outsource provider provides local project management, this is especially important if the team is located offshore.  If it is not provided as standard, ensure you have the necessary skills in-house."

The very best offshore partners can offer a local presence that can be available within the same or near timezone. We coined the phrase "Best Shoring", which provides the client with optional local services. However, even without local representation, a partner that has strong communication skills and technologies can help alleviate this offshore concern. And do note their suggestion on having the right skills in-house or the willingness to pay for a maintenance contract (their 4th point).

Cross Sea Strategy Advisors represents offshore company's that have a highly motivated and disciplined team, strong methodology and process and excellent skills - at a fair and reasonable price. For Cross Sea, presenting a partner as highly credible makes the best business sense for all parties involved.

Comments

[Aliena]

Great thoughts, I agree about enrichment of IT business with software outsourcing.