Hidden costs of software outsourcing
April 25, 2010 5 Comments
In my software product management career, I have worked with remote software development teams in India, China, Australia, Ukraine and the UK. In many of these cases, we were working with outsourcing partners. I have been wanting to write a post reflecting on what actions ensured success and what resulted in failures. It has been on my to do list for a while – like a year.
Software outsourcing is always pitched as easy to do. Common benefits that are advertised include 24-hour development day (they are coding while you are sleeping!) and the large cost benefits through hiring cheap but good talent off-shore. While there is an element of truth in this, it is also a double edged sword. The 24-hour development day can be advantageous or disastrous because a lot of bad decisions can be made by your partner team while you are sleeping. The time it takes to discover these and then rectify them is at least 48 hours. Developers overseas are also typically cheap to hire because of the favorable currency exchange rates, but if you don’t set up the right infrastructure, you could lose precious time and money because of bad architectural decisions, poor code quality, major integration issues etc.
Last week, I was forwarded a slide deck on outsourcing and its common pitfalls. This deck captures the valuable lessons I have learnt over the years working with software outsourcing partners. It in fact captures it better than I could possibly have.
This is a must read for anyone who is doing outsourcing, who has been burnt by it or who is looking to explore an outsourcing model for software development. Consider this a good 5-10 minute primer.
As full disclosure, Sitrus who has put this presentation together is the outsourcing partner in Ukraine that I had worked with and are one of the better ones I have worked with. I am not paid anything to pitch their name or to do this blog post.
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