IT Governance is about defining what decisions need to be made, who should make them and how they should be made. One of the biggest decision areas that business and IT providers should exercise strong governance over is outsourcing.
Many books and articles have been written about IT outsourcing. The business and social impact of outsourcing and, particularly, offshoring have been huge in the 21st century. It seems that for every success story, there is a story of a painful transition. In 2008, when we published “The Business Value of IT”, we believed that there was no turning back and that the future masters of IT would necessarily be masters of outsourcing. Six years later, we still believe that there is no turning back although we would modify that stark assertion today with the observation that companies including some of our clients have recognized “Total Outsourcing” of software development represents a significant corporate risk to some business.
This report reviews the most significant risks of outsourcing software development and offers up some mitigation strategies.