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Outsourcing and Requirements

     by Don McMunn, IPC Designs, LLC

The continuing momentum of outsourcing of IT software application development functions, is an easy call by the business executives to provide significant impact to the bottom-line by sharply trimming IT labor costs. Regardless which emotionally-charged side of this fence you stand, this trend will inevitably continue just as the tides ebb and flow.

Success Factors

Two of the critical success factors required for IT function outsourcing will prove valuable much closer to home:
  1. formal documentation of business processes, and
  2. increased clarity and completeness of business requirements.
Adding the "formal" adjective to anything implies structure, standards, and neatness. These are requirements adjectives IT people have been clamoring for since the late 1980's. "Why do we always have to rework the software immediately after or even during delivery?"

"Why Do We Fail?"

Three reasons are frequently the answer to this question:
  1. the requirements (when you have them!) are of a poor quality, leading to tremendous scope for interpretation and broad assumptions,
  2. the subject matter experts ("SMEs") were not sufficiently integrated into the development process to provide continuous guidance at regular intervals, or
  3. the scope of the project deliverables were allowed to grow so large, the target business drivers changed before the deliverables could be, well, delivered.
Outsourcing IT software development will end in unfulfilling and unprofitable chaos unless the fundamental requirements quality and business SME integration issues mentioned above are addressed. If projects fail to integrate SME's and software developers who speak the same language, work in the same campus, and share the same life context, then there is no way to reasonably expect to accomplish this when they are separated by six time zones, different cultures and multiple languages!

Some Technical Help

A new breed of tools which facilitate both business and software-development team communication can usher in a paradigm shift if adequately embraced, adopted and implemented. These tools support high-quality, structured, requirements definition, continuous integration, and clear project reporting via graphical interfaces that will increase visibility, team communication and support near real-time project status. The net result of which will lead to a thorough definition and understanding of both the business processes/drivers, the functional application requirements, and facilitate easy assessment of the test worthiness of the deliverable in a near real-time fashion. Definitely a tall order, but paradigm shifts are not typically incremental.

Fortune 500 Current State

While many of the major players in the software application development industry are moving in the direction of end-to-end app dev integration suites, my professional experience tells me an estimate of over 60% of the Fortune 500 businesses' processes are still stuck in the late 1980's would not be out of line. Some trouble spots I have seen in Fortune 500 companies are:
  • Doing what has worked for years,
  • informal resource transition,
  • over reliance of training by word of mouth,
  • showing very little committment to educating its employees in the modern world of business process analysis,
  • little or no emphasis on the need for integrated business systems, high-quality business data or even coordinated change managment communication between co-dependent business units.


If US (or for that matter any developed country) businesses are to remain viable competitors in the world that soon will be dominated by China, India and other emerging nations, they MUST:
  • commit themselves to a business process assessment and modernization effort, if indicated
  • show the same passion and committment to business analysts, business architecture, business planning and business process documentation that they do for quarterly profits obtained via outsourced solutions.
  • This will mean repurposing many existing SME's,
  • Generating new job roles and responsibilities and
  • providing better training in requirements definition
  • providing training in the necessity of business/IT integration and communication in modern app dev projects
  • help insure business analysts and SME's and even business owners are made aware and held accountable for their performance in the success of IT projects.
If companies commit themselves to these points, they will see their profit expectations realized, deliverable quality and success improved and the vendors who provide these services will receive accolades, compensation and meet their own goals for success. Now that's a WIN-WIN!

Copyright © 2007 IPC Designs, LLC
   Don McMunn is a professional, business-focused consultant specializing in data warehousing and
business intelligence design, development and delivery for over a decade with the
Fortune 500 and SMB segments. He may be reached at: dmcmunn at ipcdesigns dot com