Software Outsourcing Reduces Cost but Requires Vigilance

Software outsourcing is a proven mechanism to reduce software development and maintenance costs, improve responsiveness and leverage specialized skillsets. However the software development outsourcing process requires vigilance before and after the transaction that transfers development and maintenance responsibilities over to a third party.

Software projects outsourcing is multi-layered relationship between the client and vendor(s). These layers include economic needs, engineering concerns and cultural synchronization. Outsourcing software development projects required balancing these are key to reach an equitable agreement.

Mistakes in outsourcing where the client-vendor relationship is not as mutually beneficial are common and include:

1. Failing to speak with one voice

2. Skipping the homework

3. Fixating on price

4. Using too few suppliers

5. Only dealing with large vendors

6. Signing and forgetting

An analysis of these mistakes is available in Six Rookie Mistakes in Vendor Management.

Our Software Outsourcing Offerings Include:

Common Outsourcing Use Case Scenarios

Usage of Outsourcing services is seen in these use cases:

  • Outsourcing Software Maintenance – Organizations find economic benefit in outsourcing maintenance of legacy application to third parties. Prior to the transfer, a baseline of cost and engineering performance can establish a negotiating starting point for both parties to understand their mutual responsibilities.
  • Software Re-platforming – Enterprise architecture needs often require the migration or platforming of applications to new environments. Assessing an application or portfolio of applications prior to the migration provides insight and visibility to potential compatibility and integration issues.
  • Manage outsource vendor delivery of software value – Clients outsourcing millions of dollars of software development to vendor partners in exchange for enhancements to existing systems or custom development of new features and functions in existing systems or new systems. Defining and maintaining value centric economic metrics for the cost of unit of work establishes as a currency of exchange. Clients receive quantifiable value for the price paid to vendors.
Learn More:

Report - This report considers best practices in software development outsourcing and what the future may hold.

Report - This report reviews the outsourcing risks and mitigation of outsourcing software development.

Article:  Solutions for measuring software development outsourcing.

Article - Learn how to use Function Point Analysis in an outsourcing arrangement.

Case Study -This case study examines DCG's role in an outcome-based outsourcing arrangement, validating the vendor's function point counts.

Article - How to address automated function point counting in software ADM contracts.

The Insights section of our website features additional reference materials. Visit it to find more information on this topic. 

Consulting Services:

The outsourcing services featured above are packaged, standard offerings developed from years of practical experience working with industrial and commercial clients within multiple industries. These services are effective and proven but we understand you may have specific needs. We often get requests to develop customized offerings based on the fundamentals of our software outsourcing service(s), and we’d be delighted to discuss your particular situation.

Please contact Tony Timbol at 904-614-0931 to discuss your software outsourcing options.

"It's frustrating that there are so many failed software projects when I know from personal experience that it's possible to do so much better - and we can help." 
- Mike Harris, DCG President

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