Software Sweatshop

Maybe you're working with an offshore team, or maybe you're thinking about it. Or worse yet, you've been burned by an offshore "software sweatshop". We've all heard offshore outsourcing horror stories. There are obvious advantages (and disadvantages) to outsourcing. Here are 5 tips to help you choose the right offshore partner.

1). High Value, Not Low Cost – In most cases, when you send work offshore, you're saving quite a bit of money. With that in mind, when looking for an offshore team, don't look for the cheapest provider. Since you're saving money anyway, you might as well look for the most sophisticated partner you can find. In addition to technical skill, you should evaluate their responsiveness, the types of questions they ask, and their ability to manage complex projects.

2). What Kind of Firm Are You Looking For? - There are two kinds of (offshore) development shops. The first are low cost "software sweatshops" who take your specs and do development. This is fine if you have solid specs and are looking for a team to simply execute. The second kind are companies that have experience with highly complex projects in specific industries. They'll have the expertise to add value to your project by asking "what if" questions and challenge your assumptions. They will act as a partner and a peer rather than a vendor. These companies are few and far between. The way to find them is to ask what role they've played in the projects they've worked on.

This was said perfectly by Chris Lynch, VP of Engineering of eProject.com (now known as Daptiv)

"Our specs called for a partner that as technically competent and independent, [who] would tell us what they thought we were doing right or wrong, and who would function as an extended part of our team. We wanted a peer who had enough expertise of their own to recommend content and coding techniques as well"

2). Avoid 'Yes Men'  –  You'll find very good technical people all over the world, but finding people who are reliable is next to impossible. Our philosophy is that a sign of maturity is the ability to say 'no'. It's extremely rare to find a vendor that will tell you like it is. We've heard countless stories of offshore firms over-promising and under-delivering. You need to look for a partner that can be honest with you from day one, even if it means they might lose your business. A company that sets up realistic expectations is a company you can rely on, even if it's not the answer you wanted to hear.

3). Ask How They Hire and Retain – Attrition is a big problem, make sure you don't get bitten. Experienced developers are constantly looking for the next best offer. Rather then asking about the company, ask about their criteria for hiring people. This will indirectly tell you about the character of the company.

4).Quality, Quality, Quality – It's tempting to believe that sending work over seas will automatically save money. While the hourly rate is significantly less, we've seen many companies spend 3 times more than they expected because of constant rework.  Needless to say, you should ask your partner about their QA procedures. Reliable firms will always include a dedicated QA resource in every project. Experience shows that many software problems could be easily averted by implementing a strong QA methodology at the beginning of the project.

5). Go for the Long Haul – The real value of outsourcing is nurturing a team that can work with you long-term. Longer projects are better suited for outsourcing for a number of reasons. Assigning the right resources to the project, flushing out project specs, establishing clear communication channels, and knowledge transfer between your onsite and offshore teams all take time. Eventually, your offshore team will become an extension of your local team.