Sourcing relationships that rely on distributed global software development teams have been increasing in every industry. Yet, according to many estimates, nearly half of these relationships sour, falling far short of expectations. How can a multi-billion dollar industry have such an abysmal rate of success? The answer lies in the brute force methods used to date to try to both estimate and measure the processes of distributed software development.
The primitive approaches used by many sourcing providers, and software developers in general, not only rely primarily on antiquated methods to scope out projects but also fail to put into place sophisticated real time metrics to assess the progress and productivity of future software development. SLAs (Service Level Agreements), post-mortems, and project management systems, as well as seat-ofthe- pants intuition had their place in the first generation of sourcing, but they are as out of place in today's software development environment as an 18th Century craftsman in a modern day manufacturing plant.
Moving to the next generation of software development and sourcing requires moving from art to science. Given how dependent we are on software as a foundation for every product and service, anything less creates a climate of risk, uncertainty, and unjustifiable costs that undermines our ability to compete in a global marketplace.
The Emergence of a New Model for Global Software Development
Although the idea of Marshall Mcluhan's global village goes back nearly fifty years, it is not until recently that we have started to realize the true potential of moving work electronically across the globe to have it done in whatever location and by whatever talent it is best suited for. This trend to move work to wherever it can be most economically accomplished is undoubtedly the single greatest innovation of our generation. Nowhere is this more keenly felt than the arena of software product development.
The advent of the Internet, opensource development environments, universally adopted programming languages and standardized computing platforms have almost overnight altered software development from a fairly contained and localized effort to one that crisscrosses the globe.
Software developers need a new playbook; one that recognizes the critical importance of global partnerships and redefines the terms of engagement. Offshore development was once reserved for tactical and discrete functions. No longer. Today many companies are looking to offshore service providers as strategic partners in the full software development lifecycle. For many companies today, it's not only about outsourcing so-called “non-core” functions-it's about outsourcing product innovation itself.
It's all about the Cost, isn't it?
At first the globalization of software development brought with it massive savings attributed to the dramatic differences in wages and shortened development cycles due to the availability of talented pro- grammers in India, Russia, Eastern Europe and the Pacific Rim.
That hasn't changed much throughout the growth of the software development offshoring phenomenon. Delphi's research shows that cost is still the single greatest factor in making a sourcing decision for software development.
However, while the immediate savings and the availability of developers continue to play a vital role in the attraction to global software development there is a growing realization that these benefits will be fleeting at best and an outright illusion at worst.
Global teams create levels of complexity in management, metrics, and productivity that come with a high price, sometimes offsetting the savings predicted. Recent studies show that these hidden expenses can eat up more than half of the cost savings in offshore development efforts.
At the same time there is mounting pressure to improve the predictability and productivity of software development overall, no matter where the development is taking place.
The challenge in both cases, offshore and onshore, lies in the growing complexity of software development. We have, in many ways, exceeded the capacity of the frameworks we use to manage the software development process at its current scale.
According to Peter Harrison, CEO of global sourcing provider GlobalLogic, “Traditional outsourcers deliver a “spec,” - a single point on a line. To be successful, it is critical for service firms to be a part of the entire line, the entire process.” The point he makes is at the heart of the problem in many sourcing relationships where the outsourcer is seen as a discrete piece of the solution rather than an integrated component of the development architecture.
