Naive outsourcing stores up trouble

Over 80 per cent of enterprises across Europe have suffered serious problems resulting from a widespread "naive readiness" to outsource software development and the maintenance of core business applications.

Most enterprises fail to employ project management techniques and legal protection to ensure that basic specifications are maintained when outsourcing application development and maintenance, according to a study by Meta Group.

Common problems included time and cost overruns, together with issues arising from the outsourcer's failure to adhere to specifications and requirements.

The study, commissioned by Compuware, surveyed 150 senior IT executives based in EMEA.

It found that two thirds of respondents outsourced application development and maintenance projects that were deemed to be strategic and thus critical to the functioning of core businesses.

Peter O'Neill, vice president at Meta Group, told vnunet.com: "We commissioned this research to find out how diligently and professionally companies were taking their responsibilities when outsourcing application development and management.

"Many were vague, and just assumed it would be cheaper because labour is cheaper in India.

"We were surprised at the naive readiness and lack of due diligence with which some companies jumped into outsourcing their core business applications."

Over half of those who had taken the step cited the reduction of costs as their primary driver.

"Organisations need to think about whether short-term cost cutting should be the major driver for application development and maintenance outsourcing," said John Leigh, vice president at Meta.

"Successful application development and maintenance outsourcing requires that organisations understand, register and mitigate the associated risks and challenges."