Adding Measurement to Your Application Outsourcing


A recurring issue for IT and business management is whether it’s best to build an in-house team or outsource the development of software applications. Some of the biggest factors when contemplating application outsourcing are cost, security and loss of control.

Business agility remains a top priority, but this puts added pressure on teams to move fast, and can sometimes lead to rushed projects and a lack of attention to detail. When in-house teams are under tight deadline restrictions, corners can get cut. In fact, most in the developer community agree that outsourcing is the best way to go for timely and on-budget development projects.

According to the latest CRASH Report for Financial Services, it was found that outsourced applications are also higher quality, especially with respect to application security, transferability and software robustness. This is a significant finding, considering the increasing number of cyber-attacks and their impact on employee and consumer confidence. Threats continue, even in industries perceived to be well-regulated, such as Financial Services – for example, take the latest Swift malware that led to millions in stolen cash from Bangladesh banks.

So how can IT managers and developers ensure the quality of outsourced projects remains high while keeping their organizations secure, nimble and on-budget? Two ways: benchmark performance and recruit top talent.

Measure Progress

Measuring the structural quality of software applications has become a discipline in its own right, but what about measuring the quality and performance of your vendor? With the increasing sophistication and availability of automated code analysis solutions, it’s now easier than ever to check the work of your provider.

Last year, we predicted the shift toward outcome-based outsourcing. Output- and outcome-based contracts focus on how delivered software adds value to the business, which is much different from traditional contracts that focus on the resources needed to deliver the software. This kind of model should also help IT-intensive organizations get the most out of their outsourcing agreements for an extended period of time.

Recently in CIO Magazine, KPMG argued that organizations are seeing diminishing returns on outsourced projects as they shift priorities to focus on data analytics, cloud and mobile. However, software analytics provides the capability to objectively monitor contract performance over time, giving more flexibility to modify priorities and re-define what real success looks like.

Keep Talent Top-Notch

In an application development project, it’s critically important to have the right team for the job. Though the financial cost is typically greater (in the short-term), an experienced team can deliver a more superior application than a novice team.

A recent InfoQ article examined best practices to find software development professionals in a global talent pool, stating that, “done right, outsourcing reduces costs, increases productivity and reduces time to market. In addition it can improve creativity, morale, innovation, and completion rates.” A big part of making sure outsourcing is done right relies on the vendor’s ability to maintain a cohesive team that works together effectively.

This requires a partner that is good at recruitment, training and retention. Maintaining top talent can be tough, however, as coders value opportunities to work with other smart coders on demanding projects. Finding a vendor that can attract, hire and train the right talent with the right business acumen is a must. If they offer a stable and challenging work environment, they are likely to retain higher quality talent.

In today’s competitive business landscape and shift to digital, we will only continue to see more and more complex IT projects. This makes it ever important for IT managers to create working synergies between in-house and outsourced talent streams. Marrying measurement with challenging working environments should produce the best results.

Pete Pizzutillo
Pete Pizzutillo Vice President
Pete Pizzutillo is Vice President at CAST and has spent the last 15 years working in the software industry. He passionately believes Software Intelligence is the cornerstone to successful digital transformation, and he actively helps customers realize the benefits of CAST's software analytics to ensure their IT systems are secure, resilient and efficient to support the next wave of modern business.
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