| dc.description.abstract | The study presented in this thesis investigates offshore software outsourcing relationships.
Offshore software outsourcing has been increasing continuously for the last decade. More and
more software vendor companies from different countries such as India, Russia, Brazil and
China are joining the offshore `bandwagon'. Indian software companies especially have
managed to secure a leading position as offshore software outsourcing vendors. However, with
more client companies outsourcing their software operations offshore, issues associated with the
establishment and management of offshore outsourcing relationships have become more
important. With the growing volume of offshore outsourcing, the number of failures is also
increasing. A review of the literature suggests that success or failure is mainly dependent on the
management of relationships between client and vendor. Subsequently, it is imperative to
identify critical factors that can help to better manage offshore software outsourcing
relationships. Furthermore, it is also important to identify the difficulties faced in managing
offshore relationships and also how clients and vendors develop mutual trust. Trust is important
to understand in the offshore software outsourcing context as it has been reported as the most
significant contributor to the management of any human relationship. Nonetheless, different
advantages that motivate clients to outsource are also important in understanding offshore
software outsourcing.
In this study, motivators, difficulties, critical relationship management factors and trust building
factors are studied by means of empirical investigation into eighteen high maturity Indian
software companies and six of their clients based in the USA and Europe. Multiple case studies
with grounded theory analysis techniques are used to conduct the empirical investigation.
Grounded theory, which is a part of qualitative research, helps to develop emergent model from
empirical data. Furthermore, multiple case studies are used as objects to collect qualitative data
and organise overall investigation. The research methods used were piloted with two Indian
software companies before conducting the full empirical investigation.
The results of this investigation suggest that client companies are motivated to outsource their
software offshore by cost savings, quality, flexibility, core competence, skills availability,
higher productivity, faster development, technical expertise and high maturity of vendor. The
results also uncovered difficulties faced by clients and vendors in managing relationships.
Difficulties include managing cultural differences, expectation mismatch, language differences,
loss of control, distance, time zone differences, workforce reshuffling and post-contractual
matters. This investigation further identifies critical factors to managing offshore outsourcing
relationships such as effective communication, a process driven approach, commitment to the
project, transparency in actions, consistency in performance, value addition and allocating
resources effectively in the project. Furthermore, results from this study suggest that previous
work reference, experience and reputation in the offshore outsourcing business, background of
the key vendor employees, investments, prototyping and personal visits from the client are
important for achieving trust. This study also identifies that to maintain trust in the relationship
both clients and vendors perceive critical factors such as commitment, process driven approach,
communication, confidentiality, performance, honesty, transparency, demonstrability, personal
relationships and working together in outsourcing project. Based on the results of the empirical
results and their discussions, this study presents an emergent model and practical guidelines for
managing offshore software outsourcing relationships.
The uniqueness of this investigation is in its large scale empirical investigation into high
maturity software companies. Furthermore, most previous studies have investigated either
clients or vendors, whereas this study investigates vendors and their corresponding clients. An
investigation into trust in offshore software outsourcing relationships is also a significant
addition to the existing literature relevant to software outsourcing. The empirical investigation
gave rise to proposals for discussions and to an emergent empirical model. Thus the current
body of knowledge in offshore software outsourcing is enhanced by this work. Moreover,
practical guidelines, based on empirical results are proposed for client and vendors to help them
manage their offshore software outsourcing relationships. | en_US |
