Outsourcing IT Projects

[jlively]

There is another topic that had outsourcing mentioned and so as to not hijack that thread I thought I would start a new topic. I have been outsourcing projects to India for about a year now. In my experience the sucess of your project is determined by the project documentation provided, the experience of the programmer(s) in the vertical market, and the expectations regarding the project. My philosophy is if I can get a large percentage of the project complete at a VERY low cost then it will be cost effective for me to bring the remainder in house or to a local programmer.

On one project I provided mock screenshots of exactly how I wanted the program to look and provided ample documentation on how it should function. My expectation was to recieve a product that was 70% completed and could be finished locally under much more supervision. I recieved a product that was closer to 90% complete and was very happy with the work. The total cost for this software package was less than $1000, the commercial software that was used as the wish list would have cost close to $15000. No, we did not recreate a commercial package as that would be illegal. We found several commercial packages that had the features that were desired, made a combined feature list, and came up with ideas for look and feel of the screens and provided that info to the programmers.

On the other hand I do have horror stories of other projects that did not turn out as well.

Any thoughts?

[MikeH]

Let me start by saying that I live and breath IT... I am currently the IT Director for a company that consults to the financial services industry, within the next two months I will be the COO for a software development company. I sit on the National Board for the Network Professional Association, a founding member of the local chapter for the NPA, the current president of this chapter for the 2004 year, plus am an active member in other groups such as the NaSPA, TAG, IEEE. My wife is also in the industry, basicially she is a Sr. Developer/Sr Project Manager/Sr. Product Manager all roled into one position for one of the largest consulting firms in the world.

I will say that honestly, you should hear the horror stories that I hear from her in regards to the department she is in charge of having to review with a fine tooth comb the garbage sent from coders in her company's Brazil and India locations. Also, I hope you haven't had to live the fear that we both have lived over the last several years in regards to downsizing. As soon as I felt the rumbles of the downturn, we pushed and scrambled to save every penny for a "just in case" fund. Now I must admitt we have 6 months worth of operating capital equal to both of our incomes combined in the bank and that is a great feeling, but realistically, we could have been investing this capital into items like home improvements, increasing stock purchases before the upturn, having vacations, etc.

Personally, I have mixed feelings about Outsourcing. I don't mind outsourcing per say, but I would prefer to keep it in the states instead of overseas. Yes I agree that we (companies) need to control costs to the nth degree, that labor costs in the states have sky rocketed, and justifications exist for pushing it to cheaper labor markets. However, with the largest unemployment rate in the history of the US, finding someone or a small team of someones willing to do a one off application for you working straight 1099's should have been fairily easy given current market conditions. For example, the company where I am the IT Director, I just pushed and started the process to have our company website which was designed & implemented in 1999 for $550,000 to be completely re-engineered. The current site has a wide mix of technologies: VB, Javascript, Com, customer registry edits for intergrating multiple applications, and on and on and on... this re-engineering will move strictly to the .Net platform by a 3rd party (actually the original design team of the site) for only $12,500, while keeping all of the current feature sets of the existing site. I was able to get this site completely re-engineered onto one development platform, free us from being dependant on a development vendor, kept cost to a little over 2% of the original cost, while keeping the job in the US.

However, if I were you, I would call the outsourcing company to get the names of the actual team members who worked on the project. This way the next time you have a project that needs to be sent over there, you can request the same individuals, since you are familiar with their quality of work.

[ozzie]

When when you get outsourced lets see how happy you will be..
You can rant all you want about saving money but thats just like HMO talk it's not about the money its about saving jobs /families/lives..
Some will say Oh we are creating a new economy in India / wherever .. but the already rich will get richer the poor will still stay poor. Except now more poor will be in the US .....
Ask all the Dr. here how they would feel if anyone that called themselves Dr could practice..
What people forget is the laws of India / wherever are NOT the same as the laws of the US . Not enforced anywhere close to here. Intellectual properties rights laws are joke..
The quality of education especially in IT is far different.. Sure you have some bright folks but the average is just not the same as it's a culture difference.
Remember the cream of the crop leave India etc the milk and whey stay there..


Sure you can compare a custom package to the already developed package. But there are vast differences like support suitability etc.. So lets not compare apples to oranges..

When folks in the US lose jobs who pays in the end ???
YOU the TAXPAYER..
So corporate greed can shave off some money now,the profits can pay a higher bonus to the big shots and help fire someone ..
Great system huh..


The quicker people in the US wake up that local is good and service has value the better off the country will be .
Look at any non US community you can pick any country chinese for example.. Buy from the local folks FIRST then look to the outside. This why many ethnic communities become so strong as they live and spend locally .. Something "old america " had but losing fast.. Globalization is a great buzz word but only means something for a global resource. Means something to Dell, means squat to me.. The only globe I care about the the earth in general.
Think about when med claims get processed overseas how can the US enforce HIPAA.. Imagine YOUR med records being splattered across the Internet.. not pretty . Checks and balances in the US prevent this , no such checks and balances exist anywhere else in the world

But I have couple of things that outsourcing can't solve.
Onsite personal support by local people that understand the local market customs and more so the people. Making money is about building relationships not building profits.

Oh the software is free too..

So I should not care, but I do because I have seen the fallout from outsourcing and it's not pretty..
Charity still belongs at home FIRST.. and it my home that is getting beat up ..
Once you realise the US is your home you may whistle a different tune.
oz





There is another topic that had outsourcing mentioned and so as to not hijack that thread I thought I would start a new topic. I have been outsourcing projects to India for about a year now. In my experience the sucess of your project is determined by the project documentation provided, the experience of the programmer(s) in the vertical market, and the expectations regarding the project. My philosophy is if I can get a large percentage of the project complete at a VERY low cost then it will be cost effective for me to bring the remainder in house or to a local programmer. ?