Austin Integration and Development Center

Why do IT executives make the decision to pursue offshore options for software development and integration needs? The surprising answer is that a non-quantified perception of cost savings is the most common factor, followed closely by pressure from senior executives.

The reality is that cost savings from offshore software development and integration have been elusive to most IT executives. Persistent quality issues along with delays and infrastructure problems have become a hallmark of the offshore project. In fact, the two most common reasons that IT executives choose NOT to offshore their development and integration work are security and quality concerns.

Offshore development has a place within the overall multi-sourcing approach of an enterprise. The difficulty is in selecting where and when to use offshore services as opposed to onshore/offsite domestic services or internal development and integration work.

Deciding factors in a multi-source development and integration strategy need to be based on measures of complexity, criticality and a realistic measurement of internal capabilities.

	In-Source	Full time employees or in-house contractors perform all design & development work for projects.
	Out-Source	External development company performs service development tasks offsite. Can include design tasks or can be build-to-order based on specifications provided.
	Off-Shore	Off-shore development company performs service development tasks out of the country. Rarely includes design tasks.
	Multi-Source	Combination of in-source, out-source and off-shore based on priority of services balanced with costs, governance and visibility needs.

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