Case study on business risk management for software. What technology risks can cause software outsourcing to fail. This paper investigates the impact of software development outsourcing on the growth of the it sector in developing countries, especially nigeria. As part of a larger, comprehensive project plan, the risk management plan outlines the response that will be taken for each riskif it materializes. Oct 03, 2016 software development companies specialize in executing software projects and thats what they do after all. Wherein most of the clients are satisfied with their outsourcing contractors. Risks associated with any conversions of existing data required before implementation of a new system. Vendor lockin occurs when a company using a piece of software grows so reliant upon it that neither bad service nor price increases can convince it to switch to a competitor. The global software development is becoming so much complex and challengeable as the scope of the. The development partners sourcing of talent may be limited due to their location, company culture, providers. The aim of this paper is to examine the literature on outsourced software development in order to identify some risks that could occur during the precontract, contract and postcontract phases of.
When you write a research paper you build upon what you know about the subject and make a deliberate attempt to find out what experts know. Instead of primarily relying on inhouse resources to implement projects, an increasing number of software development companies are now outsourcing their projects to thirdparty suppliers that provide them with the expertise they need to successfully develop products that meet the clients expectations. Software development outsourcing has been around for many years. The qualified software outsourcing vendor carries out the programming services and related functions by using the inhouse talents and resources. Researchers have tried to investigate common risk factors and proposed the top ten lists of software risks. Thomas maricle february 23, 2011 abstract the purpose of this paper is to identify the. In this respect the risk management in gsd is also much complex than local software development. Check the cost of changing developers on a system, or hiring another outsourcing company to support the project after completion. However, a number of top ten lists were suggested in the literature. Outsourcing has sparked serious and growing debate. The very nature of agiles changing requirements, need for a high level of collaboration and selforganizing teams requires a.
It identifies major software outsourcing drivers and studies the relationship between them and the growth of the it industry. On assessment of risks in offshore outsourcing of information. Risks of outsourcing software development mobiledi. Software risks and spiral model software risks are first time introduced in the spiral model 5 by mr. According to computer economics research, more than 40% of companies that use outsourcing services are to increase the amount of outsourcing workload. These software outsourcing projects have long life cycle, largescale, broad scope and numerous risk factors. According to a recent survey by inc magazine 64% of small and medium sized businesses already outsource contrary to the popular belief outsourcing is a solution embraced by only large. We use a hypothetical software development project to explore the costs and risks for both onshore and offshore outsourcing. According to computer economics research, more than 40% of companies that. Changing outsourcer is easier than changing personnel.
This article describes how outsourcing and offshoring for software. Its a typical practice for the industry because software companies specialize in nuances and specificities of the projects development. Therefore, risks of offshore software development require to be managed as early as possible for a successful project. Thomas maricle february 23, 2011 abstract the purpose of this paper is to identify the possible risks to an organization in each of the following outsourcing situations. Jan guardian protect your business by discovering how to lower thirdparty risk when order custom software development. Few topics in it have garnered as much attention, press coverage and debate as the trend toward outsourcing of software development.
In our discussions with business and it leaders, we find that some companies have attempted to. The authors provide an analysis of current literature on it risks in outsourcing, software project development and offshoring in order to illustrate the many facets of it offshoring risks. Draft mitigating the risk of software vulnerabilities by. In the end, every software development risk comes up to take more time.
If you choose to outsource work via a wide range of specialist freelance websites and online services, youre often provided dynamic and intuitive platforms that will. Using outsourcing, a company significantly reduces its risks sharing them with outsourcer. Outsourcing is a major time savings you can buy readymade solutions, infrastructure. This was what the now liquidated software company appster attempted, when it outsourced its software development to india.
Empirical analysis of intellectual property risks in. Here are some of the key pros of outsourcing your software development. There are different models you can use to outsource the. From an economic perspective, mitigation of outsourcing project risk which includes software development risks, vendor reliability, etc.
Addressing risks in global software development and. The qualified software outsourcing vendor carries out the. Dec 11, 2016 software outsourcing is a practice in which a company delegates software development functions to a thirdparty vendor. In this way, the software outsourcing vendor saves the resources of the client. The largest group of risks was related to project management. The risks associated with offshoring software development. Top 5 risks in software development existek medium.
Download file to see previous pages companies generally opt for outsourcing to reduce production costs i. Its a typical practice for the industry because software companies specialize in nuances and. This paper examines how software development companies can manage their thirdparty. We address the issue of intellectual property ip rights in onshore and offshore software development outsourcing. Jan 18, 20 software development outsourcing has been around for many years. We extracted 85 risks and 77 risk mitigation advice items and categorized them under four major headings. Offshore, outsourcing, risks, software project management, mr. There are different models you can use to outsource the development, testing, or maintenance of a software product, but they are all based on the three primary approaches. The true costs and potential risks of outsourcing software. Outsourcing involves greater transparency result matters, not the process. A leading global outsourcing provider of offshore software development services, eu outsourcing euo has over eight years of experience developing software solutions to meet the it challenges facing us. Stop outsourcing your software development it outsourcing head points to risks and hidden expenses of outsourcing. Whether youre just starting out, wondering if your company will work, are in the process of expansion, or somewhere in between, the success of your business is deeply intertwined with risk and risk analysis. How to manage thirdparty risk when outsourcing your software.
The purpose of this prompt list is to provide project managers with a tool for identifying and planning for potential project risks. No matter what was the source of the problem the key member has left, the budget for the software license is over, etc. In the right context and deployed shrewdly, outsourcing can be a fantastic way for small business owners to improve efficiencies and bolster their companys bottom line. But that doesnt mean the practice isnt without its own disadvantages, too. Some risks are real, while others are only perceived. Mar 20, 2020 outsourcing agile software development is a different animal. This white paper recommends a core set of high 27 level secure software development practices, called secure software development a framework 28 ssdf, to be added to each sdlc implementation. Software and it outsourcing worldwide research paper. You may have desired outcomes in mind but lack a clear scope of work. Management of third party software development outsourcing.
Outsourcing service models in software development auriga. Software development outsourcing is a strategy known to all it departments and embraced by many. The case of offshore software development simulated using the fuzzy framework showed that. Speaking of the time risks in software development, it is fair to say all the risks are timeconsuming. Master service agreement in it outsourcing relevant. The global software development gsd 8, 9, 10 is becoming very difficult, complex and challenging in the context of software project management as the user problem is getting more and more challengeable. Instead of primarily relying on inhouse resources to implement projects, an increasing number of software development companies are now outsourcing their projects to thirdparty suppliers that. The paper proposes a systemic framework for assessment of information technology risks in offshore outsourcing projects based on the analytic hierarchy process. However, there may be a risk if your business grows rapidly and your partner is not able to adjust to your scaling needs. The impact of software development outsourcing on the. Outsourcing agile software development is a different animal.
Therefore, if milestones are being appropriately used. Software development risk management plan with examples. The very nature of agiles changing requirements, need for a high level of collaboration and selforganizing teams requires a different approach than was found in your parents outsourcing arrangements. Risks can be broadly categorized into control risks, security risks, organizational risks and performance risks. These software outsourcing projects have long life cycle, largescale, broad scope and numerous risk factors of various types, resulting in that various risks will be confronted in its entire life cycle. Arguably the greatest advantage of working with an external outsourcing partner is the ability to scale your team up or down. This article describes how outsourcing and offshoring for software development is a widely used business strategy implemented by many organizations worldwide. While offshore vendors often make claims suggesting they are 80% cheaper per hour, outsourcing software has many hidden and costly risks that can add up to a more costly bill than anticipated.
Supplychain risks for hardware procurement include manufacturing and delivery disruptions, supplychain risk management scrm is a discipline of risk management which attempts to. A research paper is an expanded essay that presents your own interpretation or evaluation or argument. Whether youre just starting out, wondering if your. Still, it is worth starting with the basicsservice models. Ip assets are generally intangible in nature and are easily misappropriated by the. Mobile application development is the most frequent type of software development outsourcing process. As outsourcing and expanded use of commercial offtheshelf cots products increase, supplychain risk becomes a growing concern for software acquisitions. Risks with the hardware and software the development platform chosen to perform project development. Project milestones for managing risk in software development. Risk analysis for outsourcing decisions linda duvall cmgt442 mr.
After cataloging risks according to type technical, project, process, organizational, the software development project manager crafts a plan to record and monitor these risks. The impact of software development outsourcing on the growth. When you write an essay, you use everything that you personally know and have thought about a subject. Risks and risk mitigation in global software development. This paper software and it outsourcing worldwide presents a detailed overview of its implementation to international it areas. How to manage thirdparty risk when outsourcing your. Berry boehm of his series of software development life cycle models in which the possible risks are analyzed i. Empirical analysis of intellectual property risks in software. A technology risk is a risk introduced into an outsourced software development project, which stems from tools, methods, and approaches that the it team must uniquely control.
36 1243 628 519 1006 154 407 481 1107 1382 613 127 365 581 272 783 987 330 1235 659 971 29 1178 1442 702 1198 787 248 994 367 508 605 286 1384 59 375 800 1326 728