Friday, April 15, 2005

Evaluating The Cost Of Outsourcing

Before outsourcing the project development the cost of outsourcing should be evaluated. This should be done for better outcome from the bussiness processes.
Cost of Production
The main reason for the companies having an inclination towards the developing of the software by outsourcing is the cost. The companies are working hard every now and then to reduce the cost of the software. The cost is the main driver for the companies to be motivated for getting their work done from outside.

Getting the vendor’s Trained
Training the outsourcer about the business processes and the environment required to develop the application. The offshore companies must see to it if the cost of the developing the in house project outweighs the cost of getting the project developed by going overseas.

The CMM Levels
The quality in the software industry is measured by the CMM level. This level can be from 1 and go up to 5. The software companies are trying hard to increase the quality of the software developed in terms of production and efficiency. The software companies tend to increase their reputation by getting a higher CMM level.

Project Complexity and Business Processes
The project complexity and the scale of the project should be kept in mind while going for finding an offshore partner. The complexity can hamper the overall development of the application by an unorganized and inexperienced vendor. Also, it is critical to clearly map out relevant processes and rules and then reconcile differences between the vendor’s procedures and yours before beginning any project.

Maintenance Issues
The maintenance is the key factor which can affect the relationship in terms of its time period. If the company is going for a long term relation ship, it will try to find out a partener who can go for a less maintenance cost to him and also try to put efforts for an alliance where the management of the project is good.