Outsourcing Your IT Software Project
Outsourcing all or part of software development is common practice.
There are many different reasons for outsourcing, including:
- Specialised expertise
- Cheaper development costs
- Obtaining 24 hour support knowledge across different time zones
Your outsourced project needs to be monitored carefully to ensure not only cost effectiveness but also quality and customer satisfaction.
See Monitoring Your Outsourced Project for more details.
Suggestion
Once a decision is made on the measures for the outsourcing, provide incentives for annual improvements.
Set targets for your external service provider. For example, a 10% productivity improvement for the first 12 months will earn them a payment bonus. This target could reduce to a 5% improvement per year for the next 5 year period.
However, if targets are not met, impose a financial penalty. The penalty could increase depending on how far from the target the service provider is.
How ISBSG Can Help
Resources that can assist you with monitoring your outsourced projects are:
- ISBSG data (for benchmarking)
- The following ISBSG reports:
- Managing your Maintenance and Support Environment
- Outsourcing , Offshoring and In-house. How to they compare?
- Software Development Performance by Country
If you are considering outsourcing and need help, contact ISBSG so we can direct you to independent consultants that can work with you to ensure a successful outsourcing arrangement.
