The Fundamentals of Outsourcing in Software Development [Part II]

June 23 8 min read
outsourcing the sky is the limit

While the first part of our Fundamentals of Outsourcing in Software Development guide addressed the principles one should follow when selecting an outsourcing provider, this week’s entry covers the critical phase of transitioning from in-house development to partial outsourcing. Continue reading to find out how to successfully enable change.

How to Ensure a Smooth Transition from Full In-house Development to Partial Outsourcing

Think ahead. You’ve done your homework and are now negotiating and signing a contract with that one company that favorably ticked all the boxes needed to fit in with your needs, wants, and business model. According to a Deloitte study cited by The Washington Post, “If the management team doesn’t have good continuity between negotiation and execution, or simply loses interest and turns its attention elsewhere, problems invariably arise, […] It happens time and time again. Management is so fatigued by the time they get to the signing point, they often want to declare victory and move on.”

A proper management of the transition period between in-house processes to outsourcing software development can be an even more challenging task than picking a vendor. At the very beginning of the relationship the `ground rules` are taken out of the theoretical context and gradually set in motion, thus birthing the natural obstacles occurring in the practice phase of any theory. Succeeding at implementing an outsourcing framework depends on the client’s and vendor’s ability to plan and execute an effective transition.

US consulting firm Perr&Knight made a thorough analysis of the migration process immediately following the singing of an outsourcing contract with a vendor. The experts delineated the most relevant steps to follow for a smooth transition. We narrowed down the points that fit best into the IT outsourcing ecosystem and completed the perspective with our own ideas and expertise as follows:

Documentation. A first step of the migration phase is gathering all the necessary documentation on the product or process to be developed and groomed within the outsourcing team. Operational procedures, indications, product documentation – all this can be make-it-or-break-it factors in preserving business continuity and proverbially starting off on the right foot on the part of the service vendor. Software licences and User Agreements can also be verified, aligned on both sides, and supplemented if need be.

Compliance checks. Both parties need to ensure that there are no (remaining) legal or compliance issues endangering the timeline and integrity of the outsourcing process or offshoring arrangement.

Governance, infrastructure and data transfers. This has more to do with the transparency and procedures coming from the outsourcing company, in making sure that it builds on its promises and delivers clean and transparent means of communication, reassuring the client of its availability and clear vision for the future implementation of their client’s projects. Might sound easier said than done, but, in short, the idea translates into making sure the development team is always available and has access to all the information it needs to set the wheels in motion

Disaster recovery. This boils down to thorough procedures and the perpetual existence of a contingency plan in case of an unexpected event that might damage service delivery or affect deadlines. Experts say that scenarios for such hypothesis need to go beyond keeping some liquidity on the back-burner or having good data protection in check. Regularly rehearsing fallout scenarios is not unheard of.

Project planning and resource allocation. Strategic resource allocation, task scheduling and deadlines are part of this phase. The client company must come to terms with the sudden impact that outsourcing may have on the level of fluency of its processes in the first transitional phase. However, this is the pivotal moment when the groundwork is laid out so that the benefits of this arrangement can be reaped in the future.

Training. Training and knowledge transfer is another critical part of the migration phase. The teams allocated to the client need to be fluent in the project’s details, goals, policies and procedures and the process needs to be one of integration as well as education. The principle that works the best in these cases is creating an interactive learning space where the outsourcing team becomes an extension of both business environments, capable of forwarding one set of goals to the benefit of both parties, essentially.

Conclusion and Key Takeaways

Deciding to opt for an outsourcing partner for your ICT needs will always be a cumbersome task, with a lot riding on it. However, the complexity of the decision-making process just speaks to the palpability of the beneficial outcome in quality products and services if the ’picking’ part is done right. When you will have found the perfect candidate for the job, they will surely provide for a good fit in the migration phase as well, and you will get to feel the burden being shared from day one.

To best conclude our analysis of properly outsourcing software development, we have put together a small cheat-sheet for you to scroll through, containing the key takeaways from this material and a way to instantly visualize the boxes you will have to tick to make this the best decision you will have made for the future of your company. Click here in order to access this essential resource.

Meanwhile, drop us a line if you are in need of further outsourcing assistance, and make sure to also review our piece on the benefits, challenges and opportunities of outsourcing to CEE.