SW Outsourcing -- Key Success Factors

1. SW Outsourcing -- Key Success Factors

2. Outsourcing -- Critical Success Factors • Critical Success Factors and risk mitigation -- Bitsoft’s experience • Create a strong foundation for outsourcing • Establish multilevel relationship/management structure • Put enough emphasis on knowledge transfer • Set clear objectives/metrics • Manage the overall program to meet metrics • Establish robust communication processes • Be clear about the “outsourcers” role

3. Outsourcing -- Critical Success Factors • Create a strong foundation for outsourcing • Clearly identify, internalize and document reasons for outsourcing • Get clear internal buy-in • Communicate benefits of outsourcing to the organization – financial, technical, others such as job enrichment for engineering level people • Make a decision of “what” to outsource • Clearly defines roles and responsibilities – e.g. “doing” vs. “managing outsourcing” • Bitsoft/Agilent,Germany experience

4. Outsourcing -- Critical Success Factors • Establish multilevel relationship/management structure • Establish relationship management at three levels • Technical/Operational • Overall project management • Overall relationship management • Optimal workforce mix – on-site and off-site • Ensure good alignment of the business interests of both parties over the life of the engagement

5. Outsourcing -- Critical Success Factors • Put enough emphasis on knowledge transfer • Our experience – a few examples • DAI project: 3 to 4 man months (US) • Agilent Translators project: 2 man-months (US) • Agilent 93K project: 3 man-months (US/Germany) • Multiple levels from both sides engaged in knowledge transfer • On-going visits

6. Outsourcing -- Critical Success Factors • Set clear objectives/metrics • Settle on objective performance metrics for measuring results • Evaluate results based on this • Outsource in the absence of such metrics is a high risk proposition

7. Outsourcing -- Critical Success Factors • Manage the overall program to meet metrics • Performance-based payment/pricing (such as broadly proposed by us)

8. Outsourcing -- Critical Success Factors • Establish robust communication processes • Leverage electronic communications • Email, weekly telephone checkpoint, webex etc. • Bitsoft off-site/on-site communications • Bitsoft clued into outsourcer’s evolving business environment and changing development goals • Leverage Bitsoft’s on-site team for this • Periodic (quarterly?) meetings between both sides, alternating between US and Bangalore

9. Outsourcing -- Critical Success Factors • Be clear about the “outsourcers” role • Managing outsourced resources is different from managing internal development resources – managers must resist the temptation to “do” than “manage”