Fearless IT Outsourcing


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This "IT Outsourcing 101" eBook is a concise summary from the bestselling book on the subject, "Software without Borders" and provides you the essential steps required in initiating and organizing the process to find and evaluate offshore software development options

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Fearless IT Outsourcing

  1. 1. outsourcing application development anywhere on planet earth by Steve Mezak by Author Name
  2. 2. Does outsourcing your software developmentmake sense? Is it the right fit? If so, how should go about doing it? What are the first steps?The valuable information in this new e-book fromAccelerance CEO, Steve Mezak,puts you on the right path.
  3. 3. Fearless Software Outsourcing by Steve Mezak is licensed under aCreative Commons Attribution-ShareAlike 3.0 Unported License.Based on a work at www.accelerance.com.Permissions beyond the scope of this license may be available athttp://www.accelerance.com/Fearless-Software-Outsourcing-Ebook/.Published by Accelerance, Inc.January 27, 2011e-book design lianne@flydesignmedia.com
  4. 4. Who should read this Ebook 1What is Software Outsourcing 3Chapter 1: Why Outsource 9Chapter 2: When You Should NOT Outsource 17Chapter 3: How to Select a Software Outsourcing Vendor 33Chapter 4: Conclusion 56
  5. 5. Who Should read this Ebook So, who is this Ebook, Fearless Software Outsourcing: So if you happen to be a CIO or Director of Application Application Development Anywhere on Planet Earth Development in an IT department, you should read for exactly? Who can benefit the most? The answer is this Ebook. If you are a CTO or VP of Engineering in a practically anyone at any company that understands software company, there is something for you in this the advantages of outsourcing or is planning for an report. No matter what your role or function within your outsourced software project. The reality is that very company, if you are developing custom Software for the few professionals know every- web, mobile devices or internal use, this Ebook will be thing there is to know about the of tremendous value. topic. There is always more to learn and new developments in If you happen to be a CIO or Director of the offshore software outsourc- Application Development in an IT ing industry. As more and more department, you should read this developing countries embrace Ebook. technology and education, (much like India and Costa Rica have in the past few decades), the further along we’ll be as a global economy in producing goods and services more efficiently.Fearless Software Outsourcing by Steve Mezak
  6. 6. Chatper Who Should read this Ebook One of the most important trends in business today is even Costa Rica? It’s true. And the application develop- the practice of outsourcing those functions or projects ment outsourcing phenomenon continues to grow with that can be done more efficiently and more affordably every passing year. overseas.In our truly international business environ- ment, we are all interdependent on each other. Having all your business functions performed in the country Software development gets done in where your corporate headquarters is located can be Russia, India, Ukraine, Argentina and very shortsighted. With outsourcing, your company can even Costa Rica? significantly reduce costs and enter new foreign mar- kets, all at the same time. And where’s the downside there? In fact, it’s very normal to have a company from Europe serving clients in the U.S. and utilizing partnerships with manufacturers in Asia. Also very likely is a multi-national company in the U.S. that performs marketing, selling and distribution in America but outsources all the rest to places all over the globe. Most of us know that Nike manufacturers shoes in China. Some of us have heard that Volkswagen assembles cars in Mexico. But how many of us realize just how much software develop- ment gets done in Russia, India, Ukraine, Argentina andFearless Software Outsourcing by Steve Mezak
  7. 7. What is Software Outsourcing Software outsourcing is the strategic use of external resources to perform application development services that your company either doesn’t want to do or cannot do. Developed according to your exact requirements, your software application could be up and running in record time and way below what you could produce it for in house. Have limited or no internal development capabilities? Can’t handle the project in the required timeframe? Lack the relevant technological expertise required for the project? Outsourcing can address these issues and give you a serious competitive edge . Whether it’s a simple iPhone application your company needs, an enterprise wide IT initiative that has limited budget or a massive cloud-based, software-as-a-service product that you need to bring to market in the next 18 months, the benefits of outsourcing overseas are signifi- cant. IT projects and software development outsourcing enables companies everywhere the opportunity to cre- ate highly competitive solutions in shortened time tables with considerable cost reduction.Fearless Software Outsourcing by Steve Mezak
  8. 8. What is Software Outsourcing Of course, developing software requires expert knowl- But, an established and reputable overseas, outsourced edge and a strong commitment to project completion provider can reduce these risks dramatically by address- in order to be called “successful”. The more reliable ing potential problem issues at an early stage. The re- overseas companies have teams of professionals trained sult? Your project is completed on time and on budget. to work as a team on software development projects, And you have an unprecedented opportunity to grow sometimes around the clock. And lets face it - develop- sales and market share and beat your competitor at ing software can be well out of your company’s core their own game. Not a bad deal. competence. The outsourcing process allows you to transfer this demanding business activity to an offshore You’ll learn the best five situations for outsourcing, the provider, which helps you to remain focused on your times when you should definitely not outsource, details core business. And that’s important. about how to select a software outsourcing vendor and much more. If you have ever tried to educate your self One third of all software development on the topic by doing a Google search, you would have discovered that it’s very hard to find good, comprehen- projects started are never completed sive, non-biased information out there. In this special, one of a kind Ebook, we attempted to put together the Research shows that one third of all software develop- best, most accurate and timely advice on the topic and ment projects started are never completed, and over to communicate it effectively so you can get through half of projects will exceed their budgets by over 75%. the entire Ebook in less than an hour. I think we So, no project, whether performed in house or not, is accomplished that. without risk.Fearless Software Outsourcing by Steve Mezak
  9. 9. Chapter 3 1When you shouldOutsource? Why not outsource
  10. 10. Why Outsource? Why should your company outsource your software Of course, many business owners are less than enthusi- development? Well, we alluded to some very important astic about outsourcing certain aspects of their IT oper- reasons in the introduction of this report. But, in the ations, especially their software development function. pages that follow, we’ll take a deeper dive into the spe- Nightmare stories about failed outsourcing software cifics so you can gain a solid understanding. Once you development projects can be found everywhere. The are finished reading, you’ll be 1000% more confident as truth is that many of those failures were caused by not you move forward with making a software outsourcing appreciating the differences in time zones, work ethic, decision. And informed decision making is the best kind culture, and language. If you do your due diligence and of decision making. Plus, when it comes to something take these important elements into consideration, you’ll as important as software products and services for your have a much different outcome. Lining up your project with the right combination of these attributes can make Why should your company out- all the difference in the world. source your software development? It’s important to understand that outsourcing your soft- ware development to a good vendor is not only much company, it is absolutely critical to get it right the first less risky but it can be quite advantageous. As a matter time. Anything less than that could actually cause you of fact, there are a several scenarios where outsourcing to spend more time and money than if you had assem- may be the best approach for your business. bled a team and developed the software in house. Not good!Fearless Software Outsourcing by Steve Mezak
  11. 11. WhenYou ShouldWhy Outsource? Limited Budget In addition, you can control project costs. Because it’s One of the most common is agreed upon up front, it’s less likely that there will be when you have a limited budget. surprises regarding the project budget. The product If you’re struggling with that is- specifications, conditions, and deliverables will always sue or if you want to save more be specified in the project contract. money, it’s worthwhile to con- sider outsourcing your software development. For one, you’ll be converting a permanent fixed cost (monthly salaries) into a variable cost (project fees or retainer fees). Usually, the cost of outsourcing soft- ware development is less than the cost of maintaining an internal development team. Why? There’s no training or infrastructure for one. The outsourced partner needs to have the necessary hardware, software, and training for their team. The best outsourced software providers in the world have made large investments in their com- panies and many times, have benefitted from govern- ment support. You get to leverage these investments at zero cost.Fearless Software Outsourcing by Steve Mezak
  12. 12. WhenYou ShouldWhy Outsource? Technical Skills Needed Another issue is one that many businesses face, espe- cially new or smaller firms: Your company may not have the technical skills. If your recruitment process is stalled for lack of quality candidates or, if your project requires specialized skills, which you don’t have in-house, then it’s time to seriously consider outsourcing. Keep in mind; however, that using an outsourced software develop- ment company doesn’t mean that their resources will automatically be better than yours would be. That’s the goal of course, but it takes homework to figure it out. Of course, you need to be diligent when it comes to selecting your provider. You’ll definitely want to check client references and analyze their previous projects to determine their skill and expertise level. And if you’re getting dedicated resources, don’t forget to ask for specific resumes as well as a skill’s report for each candidate.Fearless Software Outsourcing by Steve Mezak
  13. 13. WhenYou ShouldWhy Outsource? Can’t Find Enough Good Programmers Other companies have another issue altogether when it comes to deciding to outsource software development: they are too busy and are already running at full-capaci- ty. Oftentimes, there are situations where it makes sense to outsource while still maintaining your own software development capability. If your in-house team is over- loaded with projects and busy with a backlog of devel- opment requests, you should consider outsourcing your less critical jobs. This will allow your internal developers to stay focused on the jobs at hand that will most likely have the biggest impact on your bottom line. You could have the outsourced team handle the less important, day to day projects and keep the high profile ones in house. Or vice versa, whatever works for you. An out- source provider can typically handle less complex proj- ects in a shorter timeframe as they generally will have more hands on deck.Fearless Software Outsourcing by Steve Mezak
  14. 14. WhenYou ShouldWhy Outsource? What are Some Other Benefits of Software • Improve the efficiency of your in-house staff. Outsourcing? Scheduling of your resources is more efficient since in-house personnel can be assigned to current, critical, • Access to an experienced team. or ongoing projects. Finding time for a new project can A software development company has already put be difficult when current in-house resources are being together the team you need. You wont have to recruit utilized to their maximum capabilities. new talent, train them and bring them up to speed on your project, therefore the lead-time is reduced. Plus, • Having a team dedicated to the project eliminates the your ability to claim success in the project is increased need to pull staff when more urgent or daily issues when you can rely on an experienced team of profes- arise. When the project is outsourced to an experienced sionals who use the technology you require as part of and professional software developer, in-house work can their everyday business. be better managed. In addition, the completion date of your project will not be affected by things out of your • Reduce human resources costs. control. The other related issue is internal staff turnover. Hiring new staff for a short-term project can be very An in house project that lasts a year or longer could expensive, particularly if it’s a one time or short-term be jeopardized by key technical personnel leaving the project. When outsourcing, employee costs are limited company, which puts the project at serious risk. to the project duration.Fearless Software Outsourcing by Steve Mezak
  15. 15. WhenYou ShouldWhy Outsource? There are also the saved costs for training and overhead expense. If you do the project in house, you’ll have costs for software, hardware, training manuals, training staff and more. Plus, you’ll have efficiency losses for the time required for in-house staff to recruit/acquire staff, ramp up and prepare for the project that’s being considered. Why should your company outsource These issues are all factored into the hourly rates of an your software development? outsourced software development team, and may be well below your internal costs. It will most likely take less time to complete the project using an outsourced developer as well. As a result you will see the cost ben- efits of the software applications much sooner.Fearless Software Outsourcing by Steve Mezak
  16. 16. Chapter 2When You Should Not Outsource
  17. 17. WhenYou ShouldWhenNot Outsource You Should WhenYou Should Not Outsource ammunition. But how do you get started? What are the first steps? And more importantly, how do you find a First, lets address the obvious: there are real, potential qualified, high quality foreign vendor when there are so risks in software outsourcing. This is best addressed many choices and so many countries that are getting in right up front. The good news, however, is that usually the software outsourcing industry? Never fear, we will it’s because of poor preparation or research into the address all of these questions. Keep reading! outsourcing process. Most companies do not perform adequate due diligence. This Ebook, of course, cuts Managing the outsourcing risks is fundamental to down the learning curve significantly. achieving success with your project. Whether it’s a short term, speedy, one time development project or Now that you know some of the key reasons why you an ongoing, multi-year engagement, you need to know should consider software outsourcing, what are the exactly what you’re getting into. Things aren’t the same outside the U.S. borders. Arming yourself with research and knowledge will go a long way in your outsourcing What should you know before pursuits. you get involved? inherent risks? What should you know before you get involved? Preparing yourself for what to expect and knowing the lay of the land will give you the bestFearless Software Outsourcing by Steve Mezak
  18. 18. WhenYou ShouldWhenNot Outsource You Should Some of the Software development outsourcing risks You many also run into foreign outsourcing firms that include: are simply unethical. Lets face it; there are bad com- panies everywhere you go, not just in Russia, China or Critical Intellectual Property Rights and/or India. You can alleviate some of this by performing your Privacy Issues due diligence and working with a consulting company that evaluates or perhaps even pre-qualifies only the Intellectual property is often the most valuable asset of best foreign firms. There are several U.S. companies that any product-based organization. If you don’t fully un- perform this task. The other thing, of course, is to have derstand IP, and the importance of IP rights, you could a solid agreement in place and use the services of an at- be in trouble. After a few weeks or months, the over- torney with international or foreign experience. seas outsourced firm may begin to understand your company’s technology as well as you do. And they may not feel they have loyalty to your organization, even if you are the ones paying them. Reduce your IP risk by firewalling key product or process areas, extracting and filing IP before outsourcing and establish jointly-devel- oped IP ownership and confidentiality requirements. Be sure your firm and your chosen software outsourcing company are on the same page with this.Fearless Software Outsourcing by Steve Mezak
  19. 19. WhenYou ShouldWhenNot Outsource You Should Technical Research & Discovery Needed Usually software outsourcing has a clear goal of creat- ing a specific software application. Software specifi- cations will vary in detail, but there should be a clear vision of the complete solution, or at least an idea of several milestones along the way when the software ap- plication will have expected value and functionality. But sometimes companies will have a tough technical challenge or critical question how, or if it is possible, to implement a software solution. You can attempt to outsource the research & discovery process to find an answer but open-ended problems like this can be dif- ficult to solve. An offshore vendor that is used to being handed complete specifications for a software applica- tion will have a tough time dealing with research and situations where the answer is not yet known.Fearless Software Outsourcing by Steve Mezak
  20. 20. WhenYou ShouldWhenNot Outsource You Should For example, an Accelerance client several years ago wanted a software application that could capture and save the contents of the screen of a call center employ- ee over time. They were already recording the audio and now they wanted to record the screens and synchronize them with the conversation. What is the best way to do that? That was the question they wanted answered and even gave some sugges- tions of technology solutions that might work. However, the programmers at the offshore vendor interpreted the assignment as a directive to implement the screen capture with the suggested technology, not as research to discover the best solution. Don’t try to use an outsourcing vendor for research when they are used to be told what to do. If you need to outsource research then make sure your vendor has the senior level people prepared to solve challenging prob- lems and apply critical thinking. Some will jump at the chance!Fearless Software Outsourcing by Steve Mezak
  21. 21. WhenYou ShouldWhenNot Outsource You Should You Have Only an Idea and a Small Budget If this scenario sounds like your situation, you probably should not try to hire an outsourced software develop- ment team. After all, you can find great individual pro- grammers and software developers on sites like Elance, oDesk or Rent a Coder. Providers on these sites special- ize in helping small or brand new companies who sim- ply have an idea and very little cash. Sometimes, you can even barter your services with someone like this. Simply having a great idea is not enough to consider software outsourcing. And regarding the money part: The typical budget for software outsourcing with a you can’t expect something for nothing. You definitely team of qualified programmers at an excellent vendor get what you pay for if you are paying pennies for the should be a minimum of about $25,000 for a pilot proj- time of a software developer. ect and is often several hundred thousand, and even over one million dollars per year for larger dedicated teams.Fearless Software Outsourcing by Steve Mezak
  22. 22. WhenYou ShouldWhenNot Outsource You Should Five Situations for Outsourcing 1. Creating Your First Software Product If you are starting a software company and have a great And a technical entrepreneur creating a new online idea that could add value to the market or even revolu- game or app for the iPhone, for example, will be prone tionize your industry, looking overseas for your applica- to experimenting and testing out different ideas. If this tion development may be the best thing you ever do. sounds like you, wait until you are finished inventing Outsourcing your version 1.0 will provide you with an and innovating in source code, before you step into instant development team and accelerate your time to the outsourcing arena. Outsourcing your version 1.0 market, or to the users of an internal application at your will require some amount of specification . But if you company. And it will reduce your costs. haven’t finished innovating how and what the product will do, you won’t be ready. Of course, outsourcing also One note of caution: If you’re a startup and plan on depends on the nature of your innovation. outsourcing the creation of your first software product, venture capitalists and angel investors may be skeptical. A more mainstream enterprise software application Outsourcing is not a viable strategy for every startup. that uses standard software technology and delivers a But you may be bootstrapping the operation anyway. business innovation in the way that the software is used All the more reason to outsource the software develop- would be an ideal candidate for outsourcing develop- ment to a lower cost overseas firm. ment. Why? It’s much easier to create a specification to get started. See the Accelerance webinar An Accidental Programmer’s Journey to Offshore Development about specification techniques that are proven to work when outsourcing.Fearless Software Outsourcing by Steve Mezak
  23. 23. WhenYou ShouldWhenNot Outsource You Should 2. Creating a New or an Additional Software Application One thing you can say about IT development teams: It is usually easy to specify an add-on product by mak- give them the space and resources to focus and do ing use of existing product documentation and other good work and truly great things can happen. Well “artifacts” from the development process of your main known as an independent culture within the corporate product. environment, there are certain things every Dev team needs to be successful. They also may be entirely too For example, you might use outsourcing to create a ver- busy to do all the work that needs to be completed. sion of your software product to address a new market In fact, that’s almost always the case, especially with at a low cost. The starting point can be the source code a growing company with a hot product that’s on the of your main product. Your existing product is then move. a major component of the “specification” for the new product. The only thing you need to do is add a short So, you can use outsourcing to avoid distracting your description of the changes required in the new user existing development team from other important work. interface. Perhaps your new product is an add-on or extension to your main product. You can keep your internal develop- ers working on your main product while the outsourced team completes the add-on.Fearless Software Outsourcing by Steve Mezak
  24. 24. WhenYou ShouldWhenNot Outsource You Should 3. Augmenting Your Existing Software Development Team Isn’t it true that in the business world, we never have In addition, you can get round-the-clock development enough people to get the assigned work completed? when the outsourced team is offshore and multiple In practically every organization, especially smaller time zones ahead, which will help you get your software software companies and companies in emerging tech- developed quickly. nology industries, the laundry list of tasks and planned projects can seem overwhelming. And then there is the In the past it was common to outsource to a U.S.-based issue of prioritization. What’s most important? How do company to acquire special technical expertise, and this you rate project A from project B, both of which need to is still true today. Face-to-face communication with such happen in order to get the product to market? a team is very valuable in the early product definition phase. You then have the choice of using your internal The answer to some of these issues is intelligent soft- team or the outsourced team to do the coding. ware outsourcing of course, you can use an outsourced team to augment the work of your existing develop- Testing and quality assurance (QA) of your software is ment team. This approach gives you the raw manpower a terrific way to get started with outsourcing and can required to develop your software, as well as needed provide a critical function that is often understaffed in technical expertise your internal team may not possess. many software development organizations. Final inte- gration testing that is manually intensive is a good fit for outsourcing.Fearless Software Outsourcing by Steve Mezak
  25. 25. WhenYou ShouldWhenNot Outsource You Should 4. Maintaining an Existing Software Application or Product Wouldn’t you agree that maintaining and/or support- At one of my software companies, we used an Indian ing software is a much easier task than product plan- operation to support version 1.0 after a new version 2.0 ning and development? It’s absolutely true. And a lot had been developed and had become the main prod- less costly as well. Of course, getting to the place in the uct. We still had a few customers who did not want to product development cycle is easier said than done, but pay to upgrade, and we were contractually committed once you have the product in the marketplace, have to support them with version 1.0. Outsourcing of this had some sales success and are in maintenance mode non-strategic activity made a lot of sense. (or even in a version 2 spec phase), you will be in a good place for bringing in outsiders. Some people believe that maintenance programming is the only “safe” use of outsourcing. This is not true. There Hence, maintenance programming for supporting an are outsourcing companies that will never aspire to do existing software application or product is a very popu- more than this type of programming. But there are also lar use of outsourcing. Some outsourcing teams even many outsourced teams of professional programmers specialize in this kind of programming. After an initial that are experts at creating brand new software applica- ramp-up period, it is easy for them to make incremental tions and products. changes to your existing code.Fearless Software Outsourcing by Steve Mezak
  26. 26. WhenYou ShouldWhenNot Outsource You Should 5. Cutting the Burn Rate to Enable Your Company to Survive Here’s the situation: you have a “game changing” soft- You need to outsource the project overseas, because ware idea that you think is a total win and so you decide otherwise, you’ll be out of business. Not good! to start a new company. You begin by putting together a great business plan and bringing in some investors. But using overseas outsourcing to replace employees You start hiring a full engineering team to create the can be challenging. You need to keep key employees software application. Everything looks great, things are as a core technical team capable of managing the new on track and plans are coming together. Your software outsourced programming team, and to do product project is moving along well and in your head, you can management if you are a software product company. start to see the customers lining up to buy it. Of course, a better approach is to use outsourcing to Not so fast. Days turn into weeks, which turn into minimize costs right from the start. months. The software development takes longer than expected. Cost overruns are happening. You had to Outsourcing has definitely matured beyond the early show a couple “bad apples” to the door. Or perhaps adopters and is now being embraced by the early ma- the target market was misjudged and it takes longer to jority of software companies. It has become an integral close business. Whatever happens, the use of outsourc- part of the product development process at American ing in this case can mean the difference between corpo- software companies. rate life and death.Fearless Software Outsourcing by Steve Mezak
  27. 27. WhenYou ShouldWhenNot Outsource You Should Using outsourcing is like a marriage. It takes commit- ment from both sides to make the relationship work. Good communication is required. Success factors like these are the lifeblood of thriving companies making effective use of outsourcing. The bottom line? The need to cut the rate at which you’re burning through capital can lead to difficult choices. Whether you have highly paid programmers that need to be let go or simply have way too many unexpected and unforeseen costs that have come up, outsourcing may save the day – and your company.Fearless Software Outsourcing by Steve Mezak
  28. 28. WhenYou ShouldWhenNot Outsource You Should AVendor Selection Nightmare The business community is littered with stories about Good luck with that one. software outsourcing gone wrong. The reason, unfor- tunately, is usually because the company takes it upon Think about it: You wouldn’t hire a new employee themselves to handle the project – from start to finish. without a robust background check would you? You And though some companies do their research, work wouldn’t bring on a new Executive without looking at hard and end up finding a great partner to work with, a couple hundred resumes and holding multiple inter- it’s a typically a rare event. It’s almost always a better views, right? So, why do companies make a decision idea to work with an overseas software development and sign an agreement with a foreign software develop- consulting firm here in the U.S. There is simply too much ment firm after they’ve only looked at a dozen or so and to know and too much unpredictability. After all, you barely checked references? Good question. It happens are dealing with foreigners from another country. Dif- quite a bit. ferent laws, different rules, different cultures. Unfortu- nately, it’s sometimes the American superiority complex And ask yourself this: Why would you ever bring on that can get in the way. You think, “I can figure this out” an overseas software development firm just because or “how hard can it be?” Others might say to themselves, they had a great looking website, were ranked high in “If anything goes wrong, I’ll take control and tell them Google for “Chinese software outsourcing” and the sales what needs to happen.” contact spoke good English?Fearless Software Outsourcing by Steve Mezak
  29. 29. WhenYou ShouldWhenNot Outsource You Should So, I’ll share with you a quick story of one software On his own, this VP carried out a careful search for an company that, unfortunately, had a “nightmare” of an outsourcing vendor in three places: India, China, and experience. It wasn’t pretty, but hopefully, it will make South America. His goal? A low price point to give him a you more aware of the potential issues in the outsourc- specific cost savings over hiring engineers in the U.S. ing market. The moral of the story? Even when you think you’re doing everything right, things can still go very He evaluated 22 vendors in these three countries. Then wrong. he made nine site visits. Site visits are not always neces- sary, but in his case the company was interested in a First, you need to know that this company tried to do it build, operate, and transfer (BOT) arrangement giving it all on their own. Call it their independent nature, their the option of transferring the team to its own desire to save more money or their lack of knowledge. subsidiary . However you see it, it was clearly a mistake, and prob- ably a combination of all three. Second, it took them So if I hadn’t set up the story as a cautionary tale, you’d five months to make the selection. So, they didn’t make probably think that so far, he was doing everything the decision in haste. They truly thought that they were right…right? rightfully performing their due diligence. Wrong. I found out about the happening from their VP of engi- neering, who was the lead on the project. And I’m glad Because guess what happened? he told me, most companies that experience what they did never tell a soul.Fearless Software Outsourcing by Steve Mezak
  30. 30. WhenYou ShouldWhenNot Outsource You Should After all this work, time, and money, he still got less than The nightmare then began. The English skills of the ju- satisfactory results. nior programmers were limited, making communication very difficult and inefficient. And their programming What happened? So, he selected a U.S.-owned out- skills seemed even worse. Their day-to-day activities sourcing vendor with an operation in China. The vendor had to be closely directed by the U.S.-based VP and his was in the process of acquiring a second team of pro- staff. The source code developed in China was reviewed grammers in China. The VP found this second Chinese every single day (actually, every night). team to be excellent, and they quickly sketched out an architecture and design for the software that was need- Because of the 16-hour time difference with China, ed. He then worked out the financial terms with the managers in the U.S. spent many late nights emailing U.S.-based vendor and signed the agreement. detailed instructions (even pseudocode) and answer- ing questions by phone when it was daytime in China. But the acquisition of the second Chinese team by the This led to severe morale problems within the U.S. staff, U.S. outsourcing vendor fell through. A junior team from made worse by the fact that the U.S. staff never thought the existing operation in China was assigned to the VP’s outsourcing was a good idea to begin with. Missed project instead. And that’s when all hell broke lose. Do deadlines and vociferous employee frustration eventu- you think he had any control over this development? ally elevated the issue to the board level. Absolutely not. See Chapter 4 of Software without Borders for more information on the pros and cons of BOTFearless Software Outsourcing by Steve Mezak
  31. 31. WhenYou ShouldWhenNot Outsource You Should But the damage was done. Within two months, the VP Will this outsourcing story be your story? Not necessar- was gone. The outsourcing engagement he so carefully ily. You certainly could spend five months of your own arranged went bad and caused such an awful ruckus time and come up with a good vendor. But if your soft- that he was forced to leave the company. Unbelievable ware development project is small or your time line is right? In the software outsourcing industry it unfor- short, it is hard to justify expending this kind of effort, tunately happens more than it should. And rightfully even if you end up finding the perfect team. because of the issues I pointed out earlier… Or you might get a lucky referral from a friend to a good • The right preparation and research doesn’t vendor and start outsourcing more quickly. But will it be guarantee anything the best vendor? Is there a better vendor out there that • Unexpected things can and will come up, you is more experienced, works faster, and costs less? You’ll just need to be ready for them probably never know. • It is a really good idea to get expert software outsourcing advice…it’s always worth the extra Is there a way to find a team quickly that will also give investment you reliable results? Yes, there is. But it is not a simple purchasing process. And of course, the last thing I want to do is scare you away from the idea of outsourcing. In many hundreds of cases, every year, it is quite simply the best thing that ever happened to a company.Fearless Software Outsourcing by Steve Mezak
  32. 32. Chapter 3How to Select a SoftwareOutsourcing Vendor
  33. 33. How to Select a SoftwareWhenYou ShouldOutsourcingVendor TheThree-Step Process One Accelerance client put it this way: “It’s like we are If you’ve ever looked online for software outsourcing walking down the shampoo aisle at Wal-Mart and we vendors, it’s pretty amazing what you find. There are don’t know what to buy. There are just too many hundreds, possibly thousands of companies all over the choices!” globe just waiting to work with you. Simply Googling the phrase gets you 4.6 million results…wow. Five years ago, it probably would have been less than a million. There has been, without a doubt, an explosion in over- seas software development. If you are overwhelmed with the sheer number of software outsourc- ing vendors, you are not alone. We all are, even those of us in the indus- try. It is stunning to see how many there are— and they all seem to have come out of the woodwork in just the last few years.Fearless Software Outsourcing by Steve Mezak
  34. 34. How to Select a SoftwareWhenYou ShouldOutsourcingVendor So, what’s driving this trend? First: The focus on educa- Of course, you want to take advantage of the real and tion in many foreign countries over the past 30 years, substantial savings of global software development, take India and Costa Rica for example. Their govern- ments put millions into higher education and the results but you don’t want to waste time and money learning have been spectacular. The next reason is the simple how to do it. This is really the crux of the issue and a big need for it. With the rise of the internet, software as a part of what this special report is all about. The bottom service, social media and all the rest, app development line is that there are far too many companies out there and software development and hardware development making this mistake. It’s my goal to change this. and everything tied to it is needed like never before. We gotta have it. And American software developers can’t keep up. But here’s the other thing: they also want too much money. I mean some companies spend three times the amount when they use an internal IT devel- opme nt team instead of outsourcing. If your project costs $3 million to do here and less than $1 million off- shore, (for the same quality work), it’s an easy decision, right?Fearless Software Outsourcing by Steve Mezak
  35. 35. How to Select a Software WhenYou Should OutsourcingVendor In today’s fast-paced and cost-constrained world of But how do you do it? There are so many vendors just software development, no one can afford a long learn- begging to develop your software. You could hire an ing curve and the expense, in both time and money, of outsourcing advisor to help you with the process, but making a mistake. After all, if you make the wrong deci- they charge a high hourly rate and are therefore moti- sion, you could lose a lot. Some, like in the story I told vated to take as long as possible using a “complete and earlier…have even lost their job. That’s a tough price to thorough” (and that means expensive!) process to evalu- pay. ate your outsourcing choices. Your goal: outsourced engineers who work together as Most of us cannot afford that luxury, and so you prob- a cohesive, professional software development team, ably feel left on your own to sort through your choices. following a well-defined software development pro- Well, the reality is that you are not on your own, not at cess. Not a bunch of programmers thrown together in all. Hundreds of companies find themselves in this spot a room, working on the cheap in some exotic foreign every year. The difference between those that claim suc- country. Your team needs to be expert in the technol- cess in the outsourcing game and those that don’t can ogy you need. You want to find a team that can quickly be summed up in three words: follow a process. execute your software development projects, not one that will be learning on the job and on your nickel.Fearless Software Outsourcing by Steve Mezak is licensed under a Creative Commons Attribution-ShareAlike 3.0 Unported License. Fearless Software Outsourcing by Steve Mezak
  36. 36. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Well, lucky for you, that’s exactly what I have for you. A Probably the biggest obstacle to selecting a vendor stripped down, no fluff, all substance methodology for is a lack of clarity about what the process should be. getting the software outsourcing thing down. Here is People often combine these three steps, and so they are a straightforward three-step process you can follow to unconsciously sourcing, screening, and selecting all at select the best outsourcing vendor for your software once. Let’s look at each step in more detail to see how development. The three basic steps you should follow you can choose your outsourcing vendor quickly and are: safely. 1. Source: Find vendors you want to consider. 2. Screen: Apply an objective set of criteria to narrow down your choices. 3. Select: Look in more detail at your finalists and select the best one. Pretty straightforward, right? So why don’t others just follow these simple steps and achieve success with outsourcing? Some do. But most get distracted by the details, especially if they are already running a company or software development organization.Fearless Software Outsourcing by Steve Mezak
  37. 37. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Step 1: Source — CreateYour List of OutsourcingVendors What’s the most common way for out- sourcing vendors to find new business? Sounds easy, right? You do some Internet research, talk to your business friends, maybe go through some of that having a relationship with you can increase their your industry associations, and jot down the names of chances and perhaps give you the confidence to pro- some firms. You next put together a long list of possible ceed. You may even overlook some of their deficiencies choices and then narrow it down to a short list. While it if you really hit it off. And how many times in business may sound easy, it never is. But you can make is easier has this story been told? You were great friends, but on yourself, that’s for sure. terrible business partners. It happens every day. The bottom line is you can’t let personal feelings cloud your It’s true, most people find their outsourcing vendor judgment. And definitely don’t get sold by a master in one of three ways—by personal reference, Internet salesman. search, or solicitation by the vendor. In fact, you may already have several vendors on your list but would like a few more choices. What’s the most common way for outsourcing vendors to find new business? Personal references. Selecting a vendor is an important decision. Smart vendors knowFearless Software Outsourcing by Steve Mezak
  38. 38. How to Select a SoftwareWhenYou ShouldOutsourcingVendor You have to make sure they have a quality team in system, a physical location move, or a software devel- place, that they have “the chops”. That they can do the opment team, you should never make a major decision job. Talk to some of their clients. Visit their facility. Do about outsourcing with a choice of only one vendor. whatever it takes when you are sourcing your talent. Never, ever, ever. Because it really is What You Know AND Who You Know in the game of software outsourcing. Let’s face it: relationships play a big role in hiring deci- sions. And though relationships are important, you can- And of course, without established relationships, it can not rely on them alone. When hiring both employees take months to find, evaluate, and select the best out- and your outsourcing team, you need to use a combi- sourced software team to meet your needs. nation of both what and who you know to make good decisions about who to hire to develop your software. How do you objectively select the best outsourcing team for you? How can you get beyond the strong influ- Its really is What You Know AND Who You ence of relationships, or lack thereof, to select the team Know in the game of software outsourcing. that will guide and travel with you on the road to suc- cess? You certainly don’t want to use a Russian outsourc- ing company simply because one of your angel inves- tors knows the firm and wants to conserve cash as you develop your product. Whether it’s a new accountingFearless Software Outsourcing by Steve Mezak
  39. 39. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Googling for GlobalVendors Most of your potential vendors will likely come from a reputable companies make up those coveted page 1 Google search. and page 2 spots of Google. But guess what? It’s hardly ever true. We’ll start this topic by bringing up something that some of you may have never heard of. It’s called SEO. The reason why some of these outsourcing vendors Or “Search Engine Optimization”. It is the process of are at the top of the list is very likely because they have improving the visibility of a website or a web page in paid thousands of dollars to search-engine optimization search engines via the “natural” or un-paid search re- experts to use whatever tricks are required to improve sults. In general, the more frequently a site appears in their ranking on the popular search engines. And many the search results list, the more visitors it will receive vendors spend thousands more on search-engine ads from the search engine. to lead you to their web sites. Ask yourself this: do you have the perception that the And meanwhile, the best vendor happens to be on top companies in any field are usually at the top of the page 6, but you didn’t go that far because only 10% of search engines when you search for something? (like us ever go past page 3 in a search and no good com- maybe “software outsourcing companies”) If you do, pany would ever be that far down would they? Oh, yes you are definitely in the majority. Most people DO be- they can. Especially if it’s a foreign company. lieve that the best and most respected and mostFearless Software Outsourcing by Steve Mezak
  40. 40. How to Select a SoftwareWhenYou ShouldOutsourcingVendor And then once you get to the site it is hard to judge objectively whether they are the right vendor for you. Here’s how a typical online vendor search goes: 1. You do a search using technical keywords like “.NET” and “outsourcing” and you get back a list of a few vendors. 2. Are they good at .NET or just at the search engine opti- mization that puts their URL high in the results? 3. It’s hard to tell, so you just add them to the list. 4. You could have just put a bad company on your short list..ugh! In summary, it is actually pretty easy to come up with a long list of outsourcing vendors. The trick is to use an objective process to quickly shorten the list, so that it contains only the candidates you should seriously con- sider. We cover that next in step 2.Fearless Software Outsourcing by Steve Mezak
  41. 41. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Step 2: Screen— So, in total, there are more than 12 criteria I recommend Use Key Criteria to ShortenYour List for screening your outsourcing vendors, and they are divided into two categories: technical and business. There is probably nothing more important in the pro- cess than screening. This is the step that will separate Technical criteria include expertise with the specific the good firms from the great ones, the bad from the technology “stack” you need for your product. Examples really bad. Your first pass at it should go quickly. Two are Java, Microsoft .NET, and PHP. Can the team adapt to stacks – good firms and bad firms. But then it comes your software development methodology, such as RUP, down to all the important attributes you need in an agile, and test-driven development? outsourcing partner. So, what are the important characteristics you want to look for in your outsourcing vendor? What’s worked for companies in the past? From my experience and ex- haustive research, here are the top three criteria I rec- ommend that you use to select your outsourced team: • Technical competence • Experience working on your size project • Overlap with your workdayFearless Software Outsourcing by Steve Mezak
  42. 42. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Business criteria include cost, of course, but also the And of course, there is something critically important number and size of projects performed for other clients. that if not totally appreciated and understood could Is this firm big enough (or small enough) to handle your have disastrous effects: The outsourced team must projects with the importance they deserve? To you, a show respect for your intellectual property by using project needing a team of 10 engineers may not be appropriate technical, legal, and personnel procedures. small, but try getting even the time of day from a large Ask if they have had situations in which a client’s intel- outsourcing company that has taken on your project lectual property was at risk, what actions they took, and but usually bags projects needing a hundred engineers what the final results were. This one may be difficult for or more. a vendor to come up with. And some may be offended. But that might be a red flag. It all comes down to re- spect. And the law. But remember, when you are work- ing with an overseas company in a foreign land, there are different rules, different laws and, of course, a differ- ent culture you are dealing with. You’ll also want to consider the time difference. This is one factor that many companies totally forget about. But it’s really important. After all, how are you going to work on a project together if the times when you’re From Software without Borders book: awake, they are sleeping?Fearless Software Outsourcing by Steve Mezak
  43. 43. How to Select a SoftwareWhenYou ShouldOutsourcingVendor From the West Coast of the U.S. to India it’s 13.5 hours. It is a little better for the East Coast, en- abling overlap between the East Coast morning and late afternoon in India (8 a.m. EDT is 5:30 p.m. in India). However, if you prefer an overlap with conventional workday hours, you may want to consider Central and South America. Coun- tries in Eastern Europe can have some overlap with the U.S. morning and significant overlap with the Western Europe workday. Definitely something to consider. Now back to the top three criteria… Let’s look at these vendor selection criteria in more detail. As you might expect, the highest priority is the technical ability of the outsourcing vendor.Fearless Software Outsourcing by Steve Mezak
  44. 44. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Checking forTechnical Competence You need to go deep into particular details to confirm Generally, the use of .NET and Java requires a more so- that the outsourcing vendor has the experience you phisticated engineering team. C# and Java can support need. Make sure they have successfully completed proj- the creation of complex programs developed by a team ects for other clients using your target technology. of engineers. The scripting languages used in the LAMP It is pretty easy to find outsourcing vendors that spe- stack can be used to create sophisticated programs too. cialize in one or more of the five common technology However, many projects using scripts written in PHP (or stacks—Microsoft .NET, Java, PHP, C/C++, and COBOL. Perl or Python) are relatively small and developed by individual engineers and freelancers. Programming in C and C++ is a relatively specialized skill reserved for device drivers and programs that run on specialized hardware. Software that supports mil- Some will specialize in just one of these, but it is also lions of users on a web site like Google or Yahoo is often common for vendors to have a track record with two or written in C++. This is a different environment than the three. older Microsoft Visual C++. Visual C++ was used to cre- ate smaller programs for use on individual PCs running Windows.Fearless Software Outsourcing by Steve Mezak
  45. 45. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Pattern Recognition With more than 25 engineers, the management and communication structure of the group becomes the Another useful technical ability is the use of design pat- dominant success factor. If you need only one or two terns to reduce programming time. Most professional engineers, consider using individual freelance program- software development teams now regularly take advan- mers, found on web sites like Elance, oDesk or RentA- tage of their experience with design patterns as they Coder. begin new projects. Following well-known patterns enables programmers to write code more quickly, while reducing the chance of errors when compared with cre- ating software completely from scratch. You will want your offshore vendor to be familiar with design patterns if you rely on them to make professional technical deci- sions about your software architecture. Keep in mind: Most software is developed by small, agile teams of between 5 and 25 engineers. Fewer than 5 and your success will depend heavily on the qualifica- tions, skill, and experience of the individual engineers.Fearless Software Outsourcing by Steve Mezak
  46. 46. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Remember, at the end of the day, you are really hiring Selecting an offshore software development vendor is employees here. Any company, especially in today’s not a simple purchasing exercise. It is an investment in business environment looks at over 500 resumes be- the future of your company. fore they even come up with a short list for filling a new position. They then select 20-30 candidates, do phone interviews with 15 of them and then bring 10 of them in for a series of personal interviews. And that’s just the first phase of the whole thing! Most software is developed by small, agile teams of between 5 and 25 engineers. The process of selecting an outsourcing vendor should be no different. Vigorous, comprehensive, and totally methodical. No stone left unturned. A year long process for many. And a very tiring one at that. But if you save $1-2 million dollars and ensure the long term viability and success of your suite of products and your compa- ny, it will all be well worth it. Very well worth it.Fearless Software Outsourcing by Steve Mezak
  47. 47. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Step 3: Select theVendor Selecting the vendor is the toughest part of the whole Vendors on the list should be able to satisfy your most process. You’ve done your research and have a great list important criteria for technical skill, team size, and abil- of companies staring you in the face. But how do you ity to work pull the trigger? How can you hedge your bets to insure and collaborate with you during acceptable hours in that the vendor you choose is the absolute best vendor your day. for your software project? Well, at the end of the day, there is always a risk, but because of everything you’ve This third step is making your final decision. It involves done up to this point, it will be a calculated one. And looking in detail at each vendor to discover which is the remember, what will ultimately determine success is right one for you. Each one will have their plusses and whether or not you build rapport with your outsourced minuses. One that has a phenomenal team in place may team and build a solid relationship based on trust, un- not be lined up with your working schedule. Another derstanding and mutual respect. That can really carry that has good, but not industry leading skills may be the day – in any business relationship. located in your same time zone. You have to weigh it all and ultimately, figure out what the “deal breaker” would By now, you have gotten down to a short list of vendors be. The key is to look at the three R’s of references, to consider further. resumés, and rates.Fearless Software Outsourcing by Steve Mezak
  48. 48. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Here are all the tasks, including two optional things you The questions you ask should confirm technical abil- can do to investigate further: ity. What creativity do they exhibit in finding solutions to problems? What is their ability to collaborate? What • Check references kind of specification and ongoing direction is needed? • Examine resumés Were there any problems or issues? Listen carefully to • Negotiate rates and terms their answers. Analyze what they are saying as much as • Visit them (optional) what they aren’t saying. That’s important. • Do a pilot project (optional) Want to find out how their English is? Schedule a phone What others say about your potential vendor speaks interview of the engineers that will be assigned to your volumes, literally. A vendor that has 30-40 clients out project. I have carried out “interviews” by instant mes- there that are raving about them says a lot. And be senger if the engineer does not speak fluent English but aware that you should select only an outsourcing ven- can read and write it. The purpose of the interview is dor that has positive references. The best references are to confirm the engineer’s technical skills and ability to with clients in your own country. But some outsourcing communicate, which clearly are important attributes in teams have done great work and have references only a potential vendor. in other parts of the world. They could still be a good choice.Fearless Software Outsourcing by Steve Mezak
  49. 49. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Time for Negotiation! Ah, the money. (and the terms) This is the time that can After all, this could be the start of a long and fruitful make or break a potential project. Of course, the whole relationship, one that pockets you millions of dollars for thing will be a bit easier than some of the negotiations many years. you’ve had with U.S. companies because the costs will be much lower. And that’s a big part of the contract. But, And of course, everyone wants a good deal, and many there’s so much more to negotiating than simply the outsourcing vendors will do their best to negotiate dollars you are paying. There’s the project length, who with you to win your business. However, there is a limit will be working on the project, intellectual property, to how deeply the good vendors will discount. After and much more. Note: Your goal is not to come out the all, they are in business to make a profit, and they have victor, but to have a fair, win-win negotiation. One that overhead of offices, salaries, and equipment to pay for. both parties are happy with and can move forward with These costs are much lower than what you would pay in confidently. So, don’t go into this phase with a “winner the U.S., and that is why offshore outsourcing rates are takes all” mentality. That will most certainly turn off the lower to begin with. vendor. Remember, you’ll be at your best in their eyes if you try to see things from their perspective too. I know, I know, it’s hard for Americans to do, but you must try. It will pay off big time.Fearless Software Outsourcing by Steve Mezak
  50. 50. How to Select a SoftwareWhenYou ShouldOutsourcingVendor And how about retaining ownership of all the source And remember, to employ the equivalent team in the code and intellectual property? Important: NEVER EVER U.S. will easily cost you $50 to $60 an hour or more per negotiate these items. They are yours, all yours. The engineer employee and much more for contractors. copyrights for the source should all be assigned to you Offshore outsourcing gives you significant savings even or your company. And the programming work should without negotiating. be completed under a nondisclosure agreement to protect your trade secrets. The significance of this point cannot be overstated. If you don’t cover your bases with this one, it could lead to a huge problem, one that could take years to resolve, if ever. Many cultures have a differ- ent opinion about these types of issues, it’s important The copyrights for the that you make it clear that these items are off the table. source code should all be assigned to your company. Also, don’t bring up the fact that you can get a program- mer in the Ukraine or China or any other place for $8 an hour. This is probably true and is absolutely fine if you just need one programmer for a non-critical project. But, it’s not a fair comparison. If you need an outsourced team, you will also need to pay for the infrastructure and management necessary to support them.Fearless Software Outsourcing by Steve Mezak
  51. 51. How to Select a SoftwareWhenYou ShouldOutsourcingVendor Contract Elements This last important step is sometimes a slam dunk, but If they have legal counsel, make no mistake about it, not always. It is the time when any “slight of hand” or their attorneys are writing lopsided agreements, con- discrepancies can come to light. Because even if you tracts that favor them. And they will sometimes do it in have agreed to everything over the phone and have a a very sly way. Of course you say, “they are attorneys!” mutual understanding on every important point, what Bingo. You can never be too cautious. And again, this comes back in writing – and hard to decipher “legalese” is not mentioned to scare you away from overseas out- – can be very different. It happens more frequently than sourcing. It’s really good advice for any agreement, with you might think. And of course, many of us sign con- any company, whether they are located half way around tracts without really even looking at them. Glancing over the world or down the street from you. an agreement doesn’t count. You need to read every word, every section and most importantly, understand it. And some agreements that you see will be shockingly With every section of the agreement, you need to ask one blatant. The worst ones yourself: “does this favor them or us?” Then go the next have so many one-sided section, “does this favor them or us?” Get the point? terms and conditions that any smart company would refuse to do business with a vendor like this immediately. Their so called “standard” agreement may be very “unstandard” indeed!Fearless Software Outsourcing by Steve Mezak
  52. 52. How to Select a SoftwareWhenYou ShouldOutsourcingVendor The Important Elements • Assignment of copyright. This is usually a separate part of the agreement that Your main or master services agreement or MSA should specifically assigns the copyrights of the software include these elements: source code to your company. • Independent contractor relationship. • Nondisclosure obligations. The outsourcing company is an independent contrac- These contain the definition of your proprietary and tor, and its engineers are not your employees. This dis- confidential information and an agreement not to tinction has important tax consequences in the U.S., disclose it. State the length of the agreement and the especially when you are hiring individual contractors. rights of each side to end it. Terms of one or two years Regarding intellectual property rights, you own all that with the ability for either side to terminate with 30 days’ is produced, including source code, inventions, etc. notice are common. And both sides agree not to enter into other agreements that conflict with this one. • Intellectual property rights. • Noninterference with business. You own all intellectual property that is produced, in- This clause specifies that neither party will interfere with cluding source code, inventions, etc. the sales and other business activities of the other’s company or hire away employees of the other for some period of time.Fearless Software Outsourcing by Steve Mezak
  53. 53. How to Select a SoftwareWhenYou ShouldOutsourcingVendor • Force majeure. This limits the liability of both parties if work is inter- rupted by major natural disasters, like fire, flood, and hurricane, or by man-made causes such as war, terror- ism, and government regulation or restriction. • Assignment. The outsourcing vendor should be restricted from contracting out (or outsourcing your work) to another vendor without your written permission. • Governing law, jurisdiction, and venue. You want to make sure that if there is an issue that the laws of your own state and country will apply.Fearless Software Outsourcing by Steve Mezak
  54. 54. How to Select a SoftwareWhenYou ShouldOutsourcingVendor An Exhibit withWork Details You will usually add at least one exhibit to your master services agreement to cover the details of your out- sourcing engagement. Additional exhibits are used for each separate project you outsource with the vendor. The exhibit will include as much detail as you need to describe the engagement or project. A statement of work, usually copied from the proposal, is included. If a specification or statement of requirements is available, it will also be included. The pricing and payment terms are also included in the exhibit, as is provision for expenses such as travel. In engagements where you have a dedicated team of pro- grammers, there can be a rate schedule for the kinds of engineers that will be assigned to your team. For exam- ple, there can be different rates for technical architects, project managers, junior and senior software develop- ers, test engineers, and so on.Fearless Software Outsourcing by Steve Mezak
  55. 55. Chapter 4 Conclusion
  56. 56. WhenYou ShouldConclusion So, what do you think about software outsourcing If you approach your outsourcing project with confi- now? A bit more knowledgeable? Maybe a little more dence and a comprehensive plan, that will make all the confident? I hope that’s the case. It’s my sincere goal to difference in the world. communicate everything there is to know about this complex topic and distill it down to the most impor- But I know your time is limited. You have lots of impor- tant elements. From initially making the decision to tant things to handle in your business. We all do. outsource, to understanding the situations when you should consider it to ultimately selecting a software So, let us help. vendor, hopefully I have provided you with the details you need so you are prepared to go to the next step. As CEO of Accelerance, I have made it my life’s work to You have mastered “Fearless Software Outsourcing” and help companies just like yours navigate the software now know how to partner for application development overseas vendor terrain and “cross the chasm” to out- “Anywhere on Planet Earth”. sourcing success. Software outsourcing should be simple. But, the reality Our company does one thing and one thing only: We is that it is not. There is lots to know and many vendors help U.S. companies locate the right offshore IT out there just waiting for your inquiry. The thing to development resources. know is that preparation and process will carry you far.Fearless Software Outsourcing by Steve Mezak
  57. 57. WhenYou ShouldConclusion With our network of deeply assessed and pre-qualified outsourced software development. That’s our guarantee programming teams and professional software devel- and that gives you the power to get the project done, opment services, we are positioned to help any compa- ahead of schedule and below budget, not the other way ny who needs immediate assistance for any IT project, around. large or small. Any Technology. Any Country. Accelerance provides hassle-free offshore software and Simple and reliable – that’s what it’s all about. Our Rapid IT outsourcing for companies everywhere. Referral program gives you hassle-free, high-quality off- shore software application development that takes ad- Cutting programming costs? Can’t hire great program- vantage of low-cost offshore outsourcing. And you can mers locally? If you’ve exhausted all your options and get started today. With our complimentary consultation, are not sure who to turn to – Accelerance can help. And partner scorecard and referral process and introductory if you’re frustrated by the large, impersonal software conference call, you can be well on your way. outsourcing vendors out there, we understand. At Ac- celerance, we’re different. Our Global Partner Network has the right size vendors you need, providers who will Accelerance guarantees our offshore soft- get the job done on time, on budget and to your total ware development partners will perform. satisfaction. But there’s more: Accelerance guarantees our offshore software development partners will perform. In some cases Accelerance takes complete responsibility for yourFearless Software Outsourcing by Steve Mezak
  58. 58. WhenYou ShouldConclusion Offshore Software Development Success Stories ChemSW is a small company developing software Dean Haritos, CEO of PushMX just couldn’t get his products for chemical industry. They are based in Cali- outsourcing vendor in China to add enough program- fornia but has a software develo pment team in update mers to get all features they needed in their software New York. It is difficult for the company to find enough product implemented in time. But to switch vendors he Microsoft .NET programmers in Ithaca and they decided expected it would take him 6 months of valuable time. to looking into offshore outsourcing. CEO Brian Stafford In stepped Accelerance and within a day was able to spoke to several vendors and got a wide range of an- recommend three partners in India, Nepal & Vietnam swers to questions about expertise, rates and locations. for Dean’s short list. After a quick evaluation, PushMX It was all very daunting. Luckily Brian found Accelerance ramped-up small team in India in 6 weeks. After com- and ChemSW was able to easily expand their software pletion of an initial pilot project, the PushMX dedicated development capabilities with an Accelerance partner offshore team ranged between 6 to 17 developers over in Costa Rica in a few weeks. 3 years. The full ChemSW story was written up in a Business Week SPECIAL REPORT on February 13, 2009Fearless Software Outsourcing by Steve Mezak
  59. 59. WhenYou ShouldConclusion Keith Hardwicke, co-founder of K&L Consulting had a Then Keith contacted Accelerance. We recommended new client that wanted to develop an online job inter- an Accelerance partner in Ukraine with an expert RoR view video system as a 24/7 way to connect people; team. They passed Keith’s test with flying colors and those looking for employees and those looking for a have exceeded his expectations every step of the way job. The new web application would be implemented for speed, quality and even deployment of the web app with Ruby on Rails and Keith new it was too big of a in the cloud .. programming job for just himself. And if he had to hire a team of programmers, he wanted to save money by going offshore. Keith put together a small programming test with a couple dynamic web pages that can easily be created in Ruby on Rails in a day or so of programming. He used it to determine the qualifications of each off- shore vendor he contacted. The first vendor failed the test – the software worked and it was written in Ruby but did not use the Rails framework. It was a major mis- step by the vendor. You can hear Keith’s full story of selecting a software outsourcing vendor and the best way to specify the software you need in the webinar An Accidental Programmer’s Journey to Offshore Development: & the Shortcuts He Learned Along the WayFearless Software Outsourcing by Steve Mezak
  60. 60. WhenYou ShouldConclusion Jackie Slovak is the Application Systems Analyst at A careful review of their needs for technology and an Easter Seals-Goodwill Northern Rocky Mountain, Inc. Agile software development methodology enabled (ESGW-NRM), a non-profit organization that is a chapter quick selection of an Accelerance partner in Argentina of both the Easter Seals Disability Services and Good- with workday time zone overlap for collaboration on will Industries national organizations. ESGW-NRM de- the inevitable changes required, despite that perfect velops software in their IT department office in Great spec they started with. Jackie also benefited from the Falls, Montana that gathers and organizes information technical expertise of the partner who recommended in multiple offices in the states of Idaho, Montana, Utah the relatively new MVC architecture rather than less and Wyoming. ESGW-NRM is using offshore outsourcing flexible ASP.NET implementation . to save money while building time-saving applications using Microsoft .NET technology. Jackie and her team created what they thought was the “perfect” specifica- tion for a new application needed for case management to comply with state regulations. But as a non-profit Hear Jackie’s story of transition from a fixed-price outsourcing project to full Agile in the ESGW-NRM could not afford to make mistakes or wrong webinar Over the Waterfall and into the Rapids: A Better Way to Manage the Risks of Outsourced Software Development turns in their outsourcing.Fearless Software Outsourcing by Steve Mezak
  61. 61. WhenYou ShouldConclusion Our Expertise isYour Benefit We are the industry leaders for good reason. We know We go to work on our own dime to get it done right and offshore IT outsourcing. With extensive experience inte- on schedule. grating in-house and global outsourced development teams, we have led dramatic cost and time savings for Want to read more? companies everywhere. With more than 25 years of soft- ware development experience, the entire Accelerance Be sure to go to our website at www.accelerance.com team is here for you. to review our webinars, whitepapers, articles and blog posts on important topics in the software outsourcing Only Accelerance has carefully evaluated hundreds of industry. vendors around the world and will recommend the best one for your outsourced software development. You’ll And when you are ready to talk, we are here. get your software completed – the right way - and have We look forward to helping you! the peace of mind you need so you can focus on your core business. Thanks for reading – And, as I mentioned, we stand behind our global part- ners. Should your experience be less than adequate, Accelerance will fix it. No fine print. No finger pointing. Schedule your free phone consultation today. . . No quibbling. Call 1-877-992-2235 x100 60Fearless Software Outsourcing by Steve Mezak