European Application Improvement Outsourcing Challenges 2010 Revealed


IT Sourcing Europe, a UK-primarily based nearshore IT outsourcing (ITO) research and advisory firm, has surveyed eight European countries amongst April and November 2010 for the objective of benchmarking the most crucial challenges of the outsourced software program improvement (SD). Overall, 1,557 organizations from the United Kingdom, Germany, Austria, Switzerland, the Netherlands, Denmark, Sweden and Norway participated in the study and anonymously shared their software development outsourcing challenges with a worldwide business neighborhood.

According to the study findings, delayed item deliveries and missed project milestones are reported to be the most vital SD outsourcing challenges by most of the UK, German, Swiss, Swedish and Danish businesses. Alternatively, a lot of the UK and Dutch organizations point to time and cultural distinction as the most vital troubles of their SD outsourcing. IT Sourcing Europe determined the leading three challenges for every single country surveyed (in a descending way from most to least faced): UK – delayed delivery, time/cultural distinction and poor client-vendor relationships Germany – delayed delivery, poor project management (PM) on vendor’s side and hidden agenda (actual fees far exceed the anticipated ones) Switzerland – delayed delivery, hidden agenda and poor client-vendor communication Austria – poor client-vendor communication, hidden agenda and delayed delivery Netherlands – time/cultural distinction, poor client-vendor communication and delayed delivery Sweden – delayed delivery, poor PM on vendor’s side and hidden agenda Denmark – delayed delivery, poor client-vendor communication and poor high quality of delivery and Norway – poor client-vendor communication, delayed delivery and time/cultural distinction. The less crucial challenges identified are: excessive vendor’s bureaucracy, insufficient data security, alter of management and inability to handle and reduce vendor’s staff turnover. The lack of suitable sources on vendor’s side is regarded to be a somewhat essential issue in the process of the effective outsourced improvement.

To respond to the most vital challenges, most of organizations from all of the surveyed nations increase face to face communication, revise their ITO engagements and dedicate far more managerial sources. They do it by hiring extra ITO and/or project managers, relocating them to work permanently on vendor’s website, improving the education function for the outsourced teams, changing SD methodology, process, interaction with group members and PMs, cancelling existing ITO contracts and looking for new partners. Another massive ratio of firms extends project deadlines and brings in outside help such as ITO consultancies. The least well-known actions incorporate: dedication of far more IT resources for the improvement of client-vendor relationships, vendor management redesign and SD outsourcing termination and back-sourcing (bringing development back to residence). It is interesting to note that Swedish and Norwegian outsourcers are most active in cancelling ITO engagement and back-sourcing, even though German ITO buyers are most reluctant to cancel their outsourced development.

These and other findings are presented in figures in the “European ITO Intelligence Report 2010: Western and Northern Europe”.