trends in software outsourcing: best practices

Trends in Software OutsourcingBest Practices

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Table of Contents Selecting a vendor

critical factors business expectations relationship control success / failure

Applying effective outsourcing strategyfocusing on outcomes monitoring the development cycle

Managing risksrisk categories risks mitigations

Signing service level agreementsgoals & objectives performance measurement processes & practices

knowledge/data transfer technology & services evolution

client-vendor relationships

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Selecting a vendor Accounting for the most critical factors:

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finance technology process operations

people business

part of the project in the

vendor's portfolio

investing in training,

case studies, experience

quality control, development

cycle

management &

communication

selection criteria,

labor pool

flexibility to change

reflecting customers’

business needs and processes

Selecting a vendor Setting business expectations:

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goals

values

background

getting to know your partner

Selecting a vendor Setting business expectations:

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costs

risks

qualitylocation

experience dedication

Understanding the combination of:

Selecting a vendor Keeping control of the relationship:

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participate:knowledge transfer,

trainingmanage:

control

taking responsibility for the project

communicate:provide feedback,

deal with issues

Selecting a vendor Measuring success, handling failures:

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saved costs

new tools, functionality, performance

processes function without major involvement of the management team

decreased time for management/communication

customer satisfaction

Applying effective outsourcing strategy Focusing on outcomes:

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on the client side:

on the provider side:

on both sides:

• specifying business problem

• providing necessary explanations

• suggesting technology, architecture

• managing the development cycle

• feedback• quality assessment• process improvements

Applying effective outsourcing strategy Monitoring the development cycle:

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tracking the status via: reports reviews meetings

receiving end-user feedback

converting it into new requirements / bug reports

Managing risks

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Managing risks Risk categories:

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• IPR, contract• costs

• quality, performance

• core product knowledge

operationalstrategic

legalfinancial

Managing risks Risks mitigations:

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Utilize technology: tools for tracking communication automated tools for tracking task tools for measuring

progress/performance

Manage knowledgebase: technical documentation knowledge transfer within the

teams

Control the process: make sure the processes are integrated communicate regularly maintain formal specifications receive and analyze reports conduct reviews / provide feedback

Measure the deliverables: quality timeliness skills and capabilities

Adjust the contract: test possible scenarios introduce incentives and penalties share risks and rewards

utilizecontrol

risksadjust

managemeasure

Signing service level agreement Focusing on outsourcing goals and objectives:

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all vital terms and conditions should be reflected in the Service Level Agreement

take into account known issues

be clear on the assumptions you are making

Signing service level agreement Measuring performance:

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agree on a clear performance metrics choose pricing model which reflects

performance improvement introduce incentives for ideas and solutions

which result in performance improvements include penalties

Defining processes and practices:

make sure the processes and procedures are flexible enough business specific aspects should be taken into account when

defining processes

Signing service level agreement Knowledge and product data transfer aspect:

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the mitigation strategy in case the team member leaves should be in place the transition strategy in case of switching to another provider:

data relocation

procedures

code stored on

the client side

technology corresponds the project

tasks

documented code

security aspect: access to logs, backup policies modular access to the project data access levels defined for every team member

architecture addresses

functional and non-functional requirements

Signing service level agreement Evolution of technology and services:

new technologies on the market a need in newer equipment training on new technology trends reviewing the pricing model

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Signing service level agreement Client-vendor relationships:

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spread the responsibility

possible changes and improvements on both sides

additional costs : training meetings

effective collaboration model: onsite and offsite team structure

both parties should be responsible for risks within their control

onsite team

offsite team

equipment need in new services

Thank you!

2010 | Softheme Team | Kyiv, Ukraine | Software Outsourcing Solutions

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