Skip to main content

Critical Success Factors for Offshore Software Development Outsourcing Vendors: An Empirical Study

  • Conference paper

Part of the book series: Lecture Notes in Computer Science ((LNPSE,volume 6156))

Abstract

CONTEXT – Offshore software development outsourcing is a contractual business of high quality software production with significant cost-saving.

OBJECTIVE – The objective of this research paper is to analyse the factors that influence software outsourcing clients in the selection of offshore software outsourcing vendors.

METHOD – We have performed questionnaire surveys with 53 experts. We asked the participants to rank each success factor on a five-point scale to determine the perceived importance of each success factor. Our survey included success factors identified in the previous findings of systematic literature review study.

RESULTS – Our study reveal both cost-saving and appropriate infrastructure as the most influential factors in the selection of outsourcing vendors. Our results also indicate that appropriate infrastructure, cost-saving and efficient project management are common success factors across different groups of practitioners.

CONCLUSIONS – Cost-saving and appropriate infrastructure should be considered as the prime factors in the selection process of software development outsourcing vendors.

This is a preview of subscription content, log in via an institution.

Buying options

Chapter
USD   29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD   39.99
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD   54.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Learn about institutional subscriptions

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Ali-Babar, M., Verner, J., Nguyen, P.: Establishing and maintaining trust in software outsourcing relationships: An empirical investigation. The Journal of Systems and Software 80(2007), 1438–1449 (2007)

    Article  Google Scholar 

  2. Op2i.com: Outsourcing Survey Report, 2008 (2008), http://www.op2i.com

  3. Bush, A.A., Tiwana, A., Tsuji, H.: An Empirical Investigation of the Drivers of Software Outsourcing Decisions in Japanese Organizations. Information and Software Technology Journal (2007) (in press for publication)

    Google Scholar 

  4. McLaughlin, L.: An eye on India: Outsourcing debate continues. IEEE Software 20(3), 114–117 (2003)

    Article  Google Scholar 

  5. Holmstrom, H., Conchúir, E.Ó., Ågerfalk, P., Fitzgerald, B.: Global Software Development Challenges: A Case Study on Temporal, Geographical and Socio-cultural Distance. In: International Conference on Global Software Engineering, pp. 3–11 (2006)

    Google Scholar 

  6. Damian, D., Izquierdo, L., Singer, J., Kwan, I.: Awareness in the Wild: Why Communication Breakdowns Occur. In: International Conference on Global Software Engineering, pp. 81–90 (2007)

    Google Scholar 

  7. Islam, S., Joarder, M.M.A., Houmb, S.H.: Goal and Risk Factors in Offshore Outsourced Software Development From Vendor’s Viewpoint. In: IEEE International Conference on Global Software Engineering, ICGSE 2009, Limerick, Ireland, pp. 347–352 (2009)

    Google Scholar 

  8. Nguyen, P., Ali-baber, M., Verner, J.: Trust in software outsourcing relationships: an analysis of Vietnamese practitioners’ views. In: EASE, pp. 10–19 (2006)

    Google Scholar 

  9. Oza, N.V., Hall, T., Rainer, A., Grey, S.G.: Trust in software outsourcing relationships: An empirical investigation of Indian software companies. Information & Software Technology 48(5), 345–354 (2006)

    Article  Google Scholar 

  10. United-Nations: World Investment Report. The shift towards services, New York and Geneva (2004)

    Google Scholar 

  11. Palvia, S.C.J.: Global Outsourcing of IT and IT Enabled Services: Impact on US and Global Economy. Journal of Information Technology Case and Applications 5(3), 1–8 (2003)

    Google Scholar 

  12. Global Services (2009), http://microsites.globalservicesmedia.com/research

  13. McCarthy, J.: 3.3 Million U.S. Services Jobs to Go Offshore, Forrester Research (2002)

    Google Scholar 

  14. Foote, D.: Recipe for offshore outsourcing failure: Ignore organization, people issues. ABA Banking Journal 96(9), 56–59 (2004)

    Google Scholar 

  15. Nam, K., Chaudhury, A., Rao, H.R., Rajagopalan, S.: A Two-Level Investigation of Information Systems Outsourcing. Communications of ACM 39(7), 36–44 (1996)

    Article  Google Scholar 

  16. King, W.: Outsourcing becomes more complex. IT Strategy and Innovation - ISM Journal, 89–90 (2005)

    Google Scholar 

  17. Aubert, B., Dussault, S., Patry, M., Rivard, S.: Managing the risks of IT outsourcing (1998)

    Google Scholar 

  18. Blackley, J., Leach, J.: Security considerations in outsourcing IT services. Information Security Technical Report 1(3), 11–17 (1996)

    Article  Google Scholar 

  19. Pyysiainen, J.: Building trust in global inter-organizational software development projects: problems and practices. In: International Conference on Software Engineering: Global Software Development Workshop (2001)

    Google Scholar 

  20. Gonzalez, R., Gasco, J., Llopis, J.: Information systems outsourcing risks: a study of large firms. Industrial management and data systems 105(1), 45–62 (2005)

    Article  Google Scholar 

  21. Kobitzsch, W., Rombach, D., Feldmann, R.L.: Outsourcing in India. IEEE Software, 78–86 (March-April 2001)

    Google Scholar 

  22. Barthelemy, J.: The hidden cost of IT outsourcing. Sloan Management Review 42(3), 60–69 (2001)

    MathSciNet  Google Scholar 

  23. Beaumont, N., Khan, Z.: A taxonomy of refereed outsourcing literature. Business and Economics. Monash University, Australia, working paper 22/05 (2005)

    Google Scholar 

  24. Oza, N.V.: An empirical evaluation of client - vendor relationships in Indian software outsourcing companies, PhD thesis, University of Hertfordshire, UK (2006)

    Google Scholar 

  25. Bradstreet, D.: Dun & Bradstreet’s Barometer of Global Outsourcing (September 2000), http://findarticles.com/p/articles/mi_m0EIN/is_2000_Feb_24/ai_59591405

  26. Holmstrom, H., Conchuir, E., Agerfalk, P., Fitzgerald, B.: The Irish Bridge: A case study of the dual role in offshore sourcing relationships. In: 27th International Conference on Information Systems, Milwaukee (2006)

    Google Scholar 

  27. Kitchenham, B., Pfleeger, S.L.: Principles of Survey Research, Parts 1 to 6. Software Engineering Notes (2001-2002)

    Google Scholar 

  28. Lethbridge, T.C.: Studying Software Engineers: Data Collection Techniques for Software Field Studies. Empirical Software Engineering 10, 311–341 (2005)

    Article  Google Scholar 

  29. Lee, J.-N.: The impact of knowledge sharing, organizational capability and partnership quality on IS outsourcing success. Information & Management 38, 323–335 (2001)

    Article  Google Scholar 

  30. Niazi, M., Wilson, D., Zowghi, D.: A Maturity Model for the Implementation of Software Process Improvement: An empirical study. Journal of Systems and Software 74(2), 155–172 (2005)

    Article  Google Scholar 

  31. Khan, S.U., Niazi, M., Rashid, A.: Critical Success Factors for Offshore Software Development Outsourcing Vendors: A Systematic Literature Review. In: Fourth IEEE International Conference on Global Software Engineering, ICGSE 2009, Lero, Limerick, Ireland, pp. 207–216 (2009)

    Google Scholar 

  32. Khan, S.U., Niazi, M., Rashid, A.: Factors influencing clients in the selection of offshore software outsourcing vendors: an exploratory study using a systematic literature review. Journal of Systems and Software (submitted to 2010)

    Google Scholar 

  33. Black, T.: Doing qualitative research in the social sciences: An integrated approach to research design, measurement and statistics. Sage, London (1999)

    Google Scholar 

  34. Heeks, R., Krishna, S., Nicholson, B., Sahay, S.: Synching or Sinking: Global Software Outsourcing Relationships. IEEE Software, 54–60 (March/ April 2001)

    Google Scholar 

  35. Nauman, A.B., Aziz, R., Ishaq, A.F.M., Mohsin, M.: An analysis of capabilities of Pakistan as an offshore IT services outsourcing destination. In: Proceedings of IEEE 8th International INMIC, Multitopic Conference, December 2004, pp. 403–408 (2004)

    Google Scholar 

  36. Bhalla, A., Sodhi, M.S., Son, B.-G.: Is more IT offshoring better? An exploratory study of western companies offshoring to South East Asia. Journal of Operations Management 26, 322–335 (2008)

    Article  Google Scholar 

  37. Hongxun, J., Honglu, D., Xiang, Y., Jun, S.: Research on IT outsourcing based on IT systems management. In: ACM International Conference Proceeding Series, vol. 156, pp. 533–537 (2006)

    Google Scholar 

  38. Martin, B.: An Introduction to Medical Statistics, 3rd edn. Oxford medical publications (2000)

    Google Scholar 

  39. Niazi, M., Wilson, D., Zowghi, D.: Critical Success Factors for Software Process Improvement: An Empirical Study. Software Process Improvement and Practice Journal 11(2), 193–211 (2006)

    Article  Google Scholar 

  40. Niazi, M., Ali-babar, M.: De-motivators for software process improvement: An empirical investigation. Software Process Improvement and Practice Journal (Perspectives on Global Software Development: special issue on PROFES 2007) 13(3), 249–264 (2008)

    Google Scholar 

  41. Khan, S.U., Niazi, M., Rashid, A.: Critical Barriers for Offshore Software Development Outsourcing Vendors: A Systematic Literature Review. In: 16th IEEE Asia-Pacific Software Engineering Conference, APSEC 2009, Penang, Malaysia (2009)

    Google Scholar 

  42. Niazi, M., Ali-Babar, M.: Identifying High Perceived Value Practices of CMMI Level 2: An Empirical Study, in press for publications. Information and Software Technology (2009)

    Google Scholar 

  43. Kitchenham, B., Charters, C.: Guidelines for performing Systematic Literature Reviews in Software Engineering, Keele University and Durham University Joint Report. EBSE 2007-001 (2007)

    Google Scholar 

  44. Regnell, B., Runeson, P., Thelin, T.: Are the Perspectives Really Different-Further Experimentation on Scenario-Based Reading of Requirements. Empirical Software Engineering 5(4), 331–356 (2000)

    Article  MATH  Google Scholar 

  45. Baddoo, N., Hall, T.: Motivators of software process improvement: An analysis of practitioner’s views. Journal of Systems and Software (62), 85–96 (2002)

    Google Scholar 

  46. Beecham, S., Hall, T., Rainer, A.: Software Process Problems in Twelve Software Companies: An Empirical Analysis. Empirical software engineering 8, 7–42 (2003)

    Article  MATH  Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2010 Springer-Verlag Berlin Heidelberg

About this paper

Cite this paper

Ullah Khan, S., Niazi, M., Ahmad, R. (2010). Critical Success Factors for Offshore Software Development Outsourcing Vendors: An Empirical Study. In: Ali Babar, M., Vierimaa, M., Oivo, M. (eds) Product-Focused Software Process Improvement. PROFES 2010. Lecture Notes in Computer Science, vol 6156. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-13792-1_13

Download citation

  • DOI: https://doi.org/10.1007/978-3-642-13792-1_13

  • Publisher Name: Springer, Berlin, Heidelberg

  • Print ISBN: 978-3-642-13791-4

  • Online ISBN: 978-3-642-13792-1

  • eBook Packages: Computer ScienceComputer Science (R0)

Publish with us

Policies and ethics