October 29, 2007

The Seven Deadly Sins of Outsourcing

This article on The Seven Deadly Sins of Outsourcing covers some important areas you should be considering in any outsourcing relationship.

  • Feeble governance – It shouldn’t be any surprise that poor management is a guaranteed way to kill any project, whether it’s in-house or outsourced. Look for an outsourcing provider that can demonstrate a highly disciplined structure and process when working with their clients. Providers that excel at outsourced software development typically have the strongest abilities in this area.
  • Overblown expectations – A great reason to follow the walk first, run later philosophy. Your outsourcing goals must be built on a foundation of trust. Learn from your initial engagements and set expectations accordingly.
  • Blindly banishing projects – Choosing what work makes sense to outsource should be considered carefully. Don’t outsource problem projects, and look for a partner that will really complement your local skills in specific areas. We’ve found Eastern Europe to be an outstanding location for software development work.Dumbly disowning projects – You must understand what components of your business must be handled within the company, but I disagree about not sharing strategic information with your partners. Your outsourcing partner is much more than a vendor. They can help you achieve your goals, so work hard to treat them as one of your own.
  • Bad assumptions – Flexibility to adapt to changing business goals is a fact of life. If your outsourcing partner is locking you in at contract signing, they aren’t really your partner. Look for companies that are as nimble as you are.
  • Sloppy service levels – This flexibility extends to service levels as well. I don’t think punishing your partner is the right way to go, but make sure you’re both aligned and motivated to succeed together.
  • End-game myopia – Any partner you find should offer a transition path if needed. Look for someone to remain your partner even after the work is completed.