Over the last few years, the growth of IT outsourcing is far-fetched and enterprises have been largely benefiting from this. Many companies are striving to accelerate their business and choose to outsource the project offshore to save cost and time. Whenever, there is an outsourcing decision, there is an inherent risk associated with it. There are chances that organizations have been hurt due to many of the hidden pitfalls in the outsourcing process. Let’s look closely the major business benefits and pitfalls associated with a software outsourcing.
Pitfalls
Vendor Selection: Selecting the right vendor is very challenging. The failure in choosing a service provider who is inexperienced in handling similar business situation will end up in inefficient project accomplishment.
Lack of strategic planning: Enterprise should decide what sort of outsourcing relationship will best meet its needs before beginning the outsourcing. Otherwise the organization may tend to spend more cost to its outsourcing provider.
Cultural differences: Cultural difference may cause trouble in mutual understanding and business ethic differences.
The low quality of the resource: Sometimes the outsourcing workforce may lack skills and expertise. IT outsourcing providers cannot resolve your problems without your involvement and willingness to change the way you do business.
The Operating model of the provider: Inadequate analysis of the providers operating model will end up in an inevitable disappointment. Before signing an agreement thoroughly evaluate providers IT maturity, IT architecture design, contract management and delivery of services.
Threat to security and confidentiality: Evaluate the outsourcing company carefully to make sure your data is protected and the contract has a penalty clause if an incident occurs.
Inflexibility in the IT landscape: IT technologies and services change rapidly over a short period of time, so it’s important to set contractual guidelines for managing unexpected contingencies.
Inefficient Communication: Inconsistent or insufficient communication with the providers as well as among the staffs is very important. Organizations should hold informal communication sessions frequently to update the management and the employees about the outsourced project. A healthy communication set up should be there with the vendors even after the transition period is completed.
These are the few outsourcing pitfalls were outsourcing customers get burned.
Benefits
Offshore outsourcing clearly outweigh any existing pitfalls. Below are the major benefits that make the organizations think about outsourcing their software requirements.
An outsourcing partner who is having a self-managed team with dedicated resources and the latest technology tools in hand will help you in achieving the right business goals.
Time-efficient project accomplishment.
An outsourcing system will be more flexible to respond quickly to changing demands and business environments.
It also proves to be a cost efficient solution, as you will not be investing in hiring new staff meeting your new business requirements. The outsourcing partner will be much more efficient at catering to your staff as well as your software business needs.
An outsourcing partner’s work will be mainly dependent on the suggestions and feed backs from the client. So you can expect a predictable outcome, higher degree of success, and higher quality and reliability
The latest trends reveal the undeniable long-term benefits and low risk make offshore development a proven model for success. Anyway the decision is up to you, if you decided to outsource your project plan well before initiating.