1. Department of General Management and Information Systems
Prof. Dr. Armin Heinzl
Software Outsourcing Decision Aid (SODA):
A Requirements based Decision Support Method and Tool
Authors: Tommi Kramer & Michael Eschweiler
CAISE - June 21, 2013

2. Outline
• Problem Domain & Motivation
• Research Design
• SODA – A Decision Support Method
– Model Creation Phase
– Model Clustering Phase
– Structural Analysis Phase
• Evaluation
• Summary
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3. Problem Domain
• SMEs are inexperienced in software development
outsourcing
Where / what / how to outsource?
(Klimpke et al. 2011)
• Behavior patterns:
– Decisions on a gut level
– Decisions are subjective in nature and people centric
• But, SMEs want to be successful in SDO
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4. Objective
Research objective:
Definition of a decision making
approach for selective software
development outsourcing
based on software requirements
delivering:
• Good clustering quality
• Good scalability (low setup costs)
• outsourcing success
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5. Research Domain
• Applying systems theory and graph theory to
existing approaches
• Facing multi-dimensional decision problem with
including decision rationales from SE principles
(Dibbern et al. 2004, Kramer et al. 2011)
• Focus on selective sourcing of
application systems by supporting
decision making on component level
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6. Research Methodology
• Design Science Research
(Hevner et al. 2004, Peffers et al. 2007)
– Graph theory and systems theory deliver
requirements for artifact design
– Definition and implementation of a new decision
making approach in IS outsourcing as artifact
development
– Software development projects with students used
for artifact evaluation
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7. SODA (1)
• SODA: Software Outsourcing Decision Aid - A
decision making method and tool supporting IT
project teams in selecting components suitable for
outsourcing
• Phase 1: Graph Model Creation
– Representing requirements
in a graph
– Nodes: Requirements
– Edge: „similar_to“ or
„requires“ relationships
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8. SODA (2)
• Phase 2: Graph Model Clustering
– Finding cohesive groups of requirements
– Neither the number of clusters nor the clusters‘ size
is known a priori
– Newman algorithm for
“community structure
detection”
(Newman 2006)
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9. SODA (3)
• Phase 3: Structural Analysis of requirements
– Modularity
– Coupling and Cohesion
– Requirements Centrality
– Rule-based recommendations
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10. SODA
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PHASE 2
PHASE 1
PHASE 3
Resulting
Decision Determinants:
• Modularity
• Cluster Coupling
and Cohesion
• Requirements
Centrality

11. Evaluation
• Simulation by using data from four master team projects
developing a software application
• Clustering quality: More interdependencies lead to more coarse-
grained partitioning of graph. But cluster quality remains stable!
• Scalability: Higher effort in interdependency definition is not
delivering better modularity or clustering quality!
• SDO success: ?
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Project Require
ments
Interdepen-
dencies
Achievable
Modularity
No. of Clusters in
Optimal Partition
Rand Index
A 45 61 0.71 10 0.80
B 45 43 0.67 8 0.84
C 45 181 0.54 6 0.77
D 46 49 0.65 8 0.82

12. Conclusion/Contribution
• We apply modularity, clustering & cohesion as well
as centrality techniques for requirements analysis to
support outsourcing decision making
• Design and development of an appropriate method
and tool (scalable and good clustering)
• Contribution to practice
– Facilitate decision making for managers in SMEs when
it comes to the question what to outsource and what
to realize in-house
– Provide a repeatable and precise method for SDO in
order to store decision information
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13. Thank you for your attention!
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Tommi Kramer
* kramer@uni-mannheim.de

14. References
• Dibbern, J., Goles, T., Hirschheim, R., & Jayatilaka, B. (2004). Information Systems Outsourcing: A
Survey and Analysis of the Literature. Communications of the ACM, 35(4), 6-102.
• Hevner, A. R., March, S. T., Park, J., & Sudha, R. (2004). Design Science in Information Systems
Research. Management Information Systems Quarterly 28 (1), 75 – 105.
• Klimpke, L., Kramer, T., Betz, S., & Nordheimer, K. Globally Distributed Software Development in
Small and Medium-Sized Enterprises in Germany: Reasons, Locations, and Obstacles. In
Proceedings of the 19th European Conference on Information Systems (ECIS2011), Helsinki,
Finland, 2011
• Kramer, T., Heinzl, A., & Spohrer, K. (2011). Should this Software Component be Developed Inside
or Outside our Firm? - A Design Science Perspective on the Sourcing of Application Systems. In J.
Kotlarsky, L. P. Willcocks, & O. Ilan (Eds.), New Studies in Global IT and Business Service
Outsourcing: 5th Global Scourcing Workshop 2011, Courchevel, France, March 14-17, 2011,
Revised Selected Papers (pp. 115-132). Heidelberg, Dordrecht, London, New York: Springer.
• Newman, M. E. J. Modularity and Community Structure in Networks. In Proceedings of the
National Academy of Sciences of the United States of America, 2006 (pp. 8577-8582)
• Peffers, K., Tuunanen, T., Rothenberger, M. A., & Chatterjee, S. (2007). A Design Science Research
Methodology for Information Systems Research. Journal of Management Information Systems,
24(3), 45 - 78.
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