The use of offshore contract programming service providers is booming. But, according to a new report from AMR Research, IT organizations that look to contractors in India and other foreign places exclusively as a way to cut costs may be disappointed. (Go to www.eweek.com/links to see the report.)
Instead, according to report writers Colleen Niven, Laura Carrillo and Kathia Desronvil, most IT managers will get a bigger payoff from offshore outsourcing if they use it to accelerate time to market for key new applications, to supplement existing IT resources for a short time and to expand technical expertise.
Further, the success of offshore outsourcing engagements usually depends not on the tools and technologies used by the contractor but on the processes customers put in place to manage offshore projects, the report says.
According to the report, IT managers should focus on:
- laying out clear contract terms in advance (be specific, for example, about who should pay for Internet, telecom and other expenses);
- having senior executive management and active on-site management of the project; and
- putting in place a quality assurance program to improve deployment of the project.