Are you overwhelmed with the number of outsourcing vendors out there? It is amazing how many there are – and they all seem to have come out of the woodwork in just the last couple of years.
One prospective client put this way. "It's like we are walking down the shampoo isle at Wal-Mart and we don't know what to buy. There are just too many choices!"
So how do you find the right vendor? Here is a quick three step process you can follow to select the best outsourcing vendor for your software development:
1. Source – find vendors that you want to consider
2. Screen – apply an objective set of criteria to narrow down your choices
3. Select – look in more detail at your finalists and select the best one
Pretty straightforward, right? So why don't others just follow these simple steps and achieve success with outsourcing? Some do. But most get distracted by the details, especially if they are already running a company or software development organization.
Probably the biggest obstacle to selecting a vendor is a lack of focus. People often combine these three steps so they are unconsciously sourcing, screening and selecting all at once.
Let’s look at steps One and Two in more detail to see how you can choose your outsourcing vendor quickly and safely. Later I'll even provide you a link to a spreadsheet you can download to help you with the process.
Step 1: Source – Create Your List of Outsourcing Vendors
Most people find their outsourcing vendor in one of three ways – personal reference, Internet search or solicitation by the vendor. You may already have several vendors on your list but would like a few more choices.
Personal referrals are the most common way outsourcing vendors find new business. Vendors know that relationships give you the confidence to proceed and even overlook some of their deficiencies. It's like the old saying, "It's not what you know, it's who you know."
Searching on the Internet for an outsourcing vendor is also very popular. Outsourcing vendors pay thousands of dollars to search engine optimization experts to use whatever tricks are required to improve their ranking on the popular search engines. And many vendors spend thousands more on search engine ads to lead you to their web site home pages. Of course, once you get to the home page it is hard to judge objectively if they are the right vendor for you.
Finally, being contacted by an outsourcing vendor shows a level of ambition on their part which is a good thing. You can use your first impression of this contact to help you decide if the vendor should be placed on your list. Did they visit your web site and know about your business? Do they have other clients similar to you? Or is their first call a fascinating (to them) monologue covering every detail of their past achievements?
In summary, it is actually pretty easy to come up with a list of outsourcing vendors. The trick is to use an objective process to quickly shorten the list to only the candidates you should give serious consideration. We cover that next in Step 2.
Step 2: Screen – Use Key Criteria to Shorten Your List
Next you should think about the important characteristics you want to look for in your outsourcing vendor. Here are the top three criteria I recommend you use to select your outsourced team:
1. Technical competence
2. Experience working on your size project
3. Overlap with your workday
Actually, there are over twelve criteria I recommend to screen your outsourcing vendors. More about that later. First, let’s look at these top three in more detail. As you might expect, the highest priority is the technical ability of the outsourcing vendor.
Checking for Technical Competence
You should determine the top three most important technical skills that you want the outsourcing vendor to have. If you focus on more than three, you may get caught up in the minutia of technical detail that is just not as important as the soft skills of the team.
When you ask about technical competence, do not settle for “Yes, we can do that!” The vendor should describe projects completed for other clients where your required technical skills were actually used. They need to convince you that they really understand the technology and will not be learning on the job.
Too Big, Too Small or Are They Just The Right Size?
Consider the number of engineers you need to develop your software and whether the vendor has experience dealing with the same size project. Most software is developed by small agile teams of between 5 and 20 engineers. Less than 5 and your success will heavily depend on the qualifications, skill and experience of the individual engineers. With more than twenty engineers, the management and communication structure of the group becomes the dominant success factor.
Work Around The Clock
Many people that outsource think they want 24 hour development in India. Of course, India is an excellent outsourcing destination and a majority of outsourced software development from the United States is performed by Indian companies.
However, if you prefer an overlap with conventional workday hours, then you may favor another location. For example, countries in Central America and much of South America are on the US Eastern standard time zone. This provides complete overlap with the workday in most parts of the US.
Use a Complete Outsourcing Decision Matrix
We have looked at the top three criteria – expertise with your required specific technical skills, size of the team and workday overlap. There are a dozen criteria you should consider in the screening phase.
The best way to screen vendors is with a decision matrix. You first enter the specific technical skills you need along with the other screening criteria. You can download this Excel file containing a decision matrix along with the criteria used by Accelerance for screening vendors:
http://www.Accelerance.com/docs/AcceleranceVizResDecisionMatrix.xls
Use it as an example or a starting point to create your own decision matrix. If you have enough time and connections then you can use the decision matrix to evaluate the outsourcing teams you find on your own.
The Short Cut to Sourcing and Screening
In the next issue of Runtime, I will describe a short cut to Sourcing and Screening you can use if you don’t happen to have a list of outsourcing vendors to compare. We will also cover the details of Step 3 for making the final selection of your outsourcing vendor.
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But if you still find the outsourcing vendor selection process daunting, then give Accelerance a call. The Quick version of the Vision Resources service is free and helps you quickly select your outsourcing vendor from over 20 proven and expert Accelerance software development teams in over 14 countries around the world.
Until next time,
Steve Mezak
Accelerance, Inc.
Risk-Free Outsourcing
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