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Outsourcing

Outsourcing

Review ISBSG’s resources on outsourcing

The IT industry is struggling with the move from traditional ‘waterfall’ projects to agile teams. As the scope of a project or product to be developed is not fixed any longer, external suppliers can’t bid for fixed prices and fixed date contracts. So, many organizations that moved to an agile way of working are now contracting external vendors using a Time & Materials contracting method.

Time and Materials contracting means hourly rates. However, this is an industry bad practice, as there is no internal pressure for a supplier to become more productive or to take ownership for quality. In fact, lower productivity and quality cause higher costs for the customer, and higher incident volumes result in unhappy customers and higher maintenance costs.

In Time & Materials contracts it is necessary to include certain output-based KPI’s. ISBSG recommends Project Delivery Rate (Productivity), Cost Efficiency, Delivery Speed, Project Quality and Product Quality. This concept is explained in the short paper, Output Based Contracting. Also, visit ISBSG Data Subscriptions web page.

Improve your knowledge of outsourcing

Read articles on outsourcing, by leading software metrics experts.

Inhouse versus Outsourced Applications

20 February 2024

Many organizations employ software development experts to develop applications that are used inhouse or sold to customers. Other organizations outsource application development to specialized, external companies. In this short paper, we examine the differences in productivity and delivery speed between in-house and outsourced application development.

Outsourcing Measurement

18 September 2020

Outsourcing Productivity

22 August 2014

Based on the speaker’s experience negotiating and managing many outsourcing contracts using Function Points as a Key Performance Indicator, this presentation describes the pitfalls that can be experienced if one takes too simplistic a view of the meaning and use of Function Point data and suggests ways in which they may be avoided.