A GSA report in 2018 shows that 70% of the companies surveyed are going to outsource more in the upcoming years. And research by Technavio<\/a> shows that ” the IT outsourcing market size will grow by $98 billion during 2020-2024 “.<\/p>\n\n\n\n But\ndespite its tremendous growth, global outsourcing has high failure rates.\nAccording to Dun & Bradstreet’s Barometer of Global Outsourcing, “20\nto 25% of all outsourcing relationships fail within two years, and 50% fail\nwithin five”. <\/p>\n\n\n\n Many establishments experience delays, budget overruns, low-quality services, and even contract termination. <\/p>\n\n\n\n But what exactly is the problem? How come almost half of the outsourcing companies cannot deliver the required value? <\/p>\n\n\n\n Why do they fail? <\/em><\/p>\n\n\n\n And most importantly, how can you avoid possible complications? <\/em><\/p>\n\n\n\n The blame doesn’t solely lay on the outsourcing companies. <\/p>\n\n\n\n A client’s unfamiliarity with software development and outsourcing processes, their unclear expectations, and their lack of proper project management and project estimation may all lead to disaster.<\/p>\n\n\n\n Now\nlet’s dive deeper into each of these complications:<\/p>\n\n\n\n Companies usually outsource their software development to escape the costly and stressful process of hiring permanent employees. <\/p>\n\n\n\n But they sometimes lack the required technical knowledge and expertise in software development and project estimation, and this may lead to the following complications with the outsourcing company:<\/p>\n\n\n\n Try getting help from\na third party in this situation. Many online platforms offer consulting\nservices and can help you resolve these problems. <\/p>\n\n\n\n Unfamiliarity with\nsoftware development is the initial cause of project failure. This factor is\nthe main problem that leads to some of the following setbacks.<\/p>\n\n\n\n Clients usually fail to delineate their project’s objective and desirable result; this affects both them and the outsourcing company’s perspective of the deliverable product and outcome. <\/p>\n\n\n\n Without a clear-cut understanding, clients change their orders frequently, and this causes delays and cost overruns.<\/p>\n\n\n\n Clearly\nunderstand the implications of the project and have clear and concise standards\nand preferences. Be as transparent and realistic as possible about your goals.\nThen, make sure your outsourcing company understands your outlook and is on the\nsame page with you.<\/p>\n\n\n\n Some outsourcing companies set unrealistic deadlines and estimations for software projects when bidding for a project and writing a proposal to win the clients over. <\/p>\n\n\n\n And some clients accept their conditions because they are unfamiliar with their software development process. They attempt to save time and costs, but they end up with an unsatisfactory product and spend more time and money on redoing the project.<\/p>\n\n\n\n For\ninstance, if two companies propose completing your project in five months and\none company offers the same services in three months, and you choose that one\ncompany, you’re not in for a bargain; you’re in for a fraud! <\/p>\n\n\n\n Be realistic in your timeline and budget estimates, and avoid any company that sets unattainable goals; you don’t want your outsourcing company to bail on you after one payment!<\/p>\n\n\n\n To avoid making ambitious and unrealistic estimates, it’s better to know about global outsourcing rates<\/a> before outsourcing your software project to another company.<\/p>\n\n\n\n Clients\nassume that by signing a contract with outsourcing companies, they hand their\nproject off to them entirely. But the truth is the project still needs\nmanagement and supervision, so it doesn’t deviate.<\/p>\n\n\n\n Set your priorities straight and plan your project thoroughly before announcing the release date of your product, this way you can build your project estimates afterward and let the outsourcing company know about them in detail.<\/p>\n\n\n\n Have a consistent methodology for planning and executing your project. Most companies use Agile Project Management methodologies and avoid setting everything in stone. <\/p>\n\n\n\n If you want to keep things flexible as well, you cannot plan every small detail; but try to specify the tasks for your nearest milestone. <\/p>\n\n\n\n Sometimes\nclients don’t share some information with outsourcing companies because they\nbelieve some things are apparent. But if the outsourcing company doesn’t\ncompletely understand what they’re supposed to accomplish, then the work will\nnot be completed as expected. <\/p>\n\n\n\n What is\napparent to you may not be as clear to the outsourced team, so don’t hesitate\nto share every detail of the project with them. In this case, it’s okay to\novershare to some extent. Try to use every opportunity to close the\ncommunication gap; be sure to hold regular video conferences and give and\nreceive feedback frequently.<\/p>\n\n\n\n In some\ncases, clients avoid sharing some information because they don’t trust the\noutsourcing company enough and don’t want to take a risk and have their idea\nstolen. <\/p>\n\n\n\n To avoid this conflict, have your outsourcing company sign a confidentiality agreement or an NDA (non-disclosure agreement) and delineate their security responsibilities; this creates a confidential relationship between both parties. Consequently, the outsourcing company is bound not to disclose any information covered by the agreement.<\/p>\n\n\n\n Being aware of these factors and resolving them will mitigate the risk of project failure in outsourcing your tech project.<\/p>\n\n\n\n Read our top 5 tips about successfully outsourcing software products<\/a>. <\/em><\/p>\n\n\n\n If you need help from a third party, we at WinATalent<\/a> offer technical advice and consultation so you can get your outsourcing strategy right. <\/p>\n\n\n\n We estimate your project’s scale and budget in different circumstances and provide you with the information you need, so you can successfully outsource your tech project. <\/p>\n\n\n\n We also have a network of vetted talents who are willing to help you develop your tech project, so you have the most desirable outcome. <\/p>\n\n\n\n Contact us, and we will get in touch with you within one working day.<\/p>\n\n\n\n Software development outsourcing is on the rise. More and more clients are entrusting their major and minor projects to outsourcing companies. And even though enterprises and other establishments were somewhat pessimistic towards the idea before, luckily, their views are being altered bit by bit. A GSA report in 2018 shows that 70% of the companies surveyed are […]<\/p>\n","protected":false},"author":3,"featured_media":791,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21,71,125],"tags":[18,57,56],"yoast_head":"\nInsufficient technical expertise<\/strong><\/h5>\n\n\n\n
Unclear expectations and objectives<\/strong><\/h5>\n\n\n\n
Ambitious project estimates<\/strong><\/strong><\/h5>\n\n\n\n
Improper planning<\/strong><\/h5>\n\n\n\n
![\"software](\"\/blog\/wp-content\/uploads\/2020\/12\/software-development-outsourcing-failure-1024x576.png\")
<\/figure>\n\n\n\nLack of communication <\/strong><\/h5>\n\n\n\n
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