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Shall project to be outsourced or it is better to performs it themselves.

08.08.2009 While advertising Andersen services I often have to answer to potential customer the same question (by the way, one of the most important). "Why it is more profitable to order your services than to organize my own IT team that performs the project". Here I’ll try to give the answer. Also I would like to highlight your attention that I speak about software development projects as well as implementation of a pre-built solution of software suppliers, but not any kind of technical IT support, data center operations or application maintenance. The characteristics of the projects will help determine if they are a candidate for outsourcing or not. While there is no "ideal" development project suitable for outsourcing, a project that has one or more of these traits is worth considering. Generic functionality. Generic projects are perfect outsourcing candidates. Outsourcing options are plentiful, the pool of consultants familiar with the functionality is larger, solutions are well honed, and pre-built components are likely to abound. Examples of these projects are: Accounting, Warehouse, Budgeting and so on. Custom, but highly specified projects. The more precise the project specifications, the more amenable the project is to outsourcing. The outsourcer knows exactly what it must do to perform its work, the deliverables expected, the functionality needed, the timeframes required and expectations between the parties are tightly aligned. Routine projects. The customer invites outsourcer to implement a big but routine task. For example development of data interface between applications, improvement of reporting, QA tasks and so on. Sometime project-oriented type of work could be changed for time sheet labor. During the outsourcing project, it is highly recommended for the customer to organize its own project team that will be responsible for the future project maintenance; of course it’s more applicable for the complex projects. I do not recommend to outsource the following type of projects: Risky projects. In this kind of projects it is very important for company to manage development of process itself because of the high risk to lose an IT competence or unique technologies that project comprises. Examples of these projects are: a billing system of cellular operator, software of stock exchange. Specific projects. This class of projects is tightly tied with the science or some other complex calculations. In such projects staff is not always even pure programmers, but scientists that have knowledge to automate its own calculations. These principles of project splitting are very simple, but they give an idea how to act in situation when you are not completely sure what to prefer. Alexander Khomich

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