Lunch and Learn, Pitfalls and Best Practic, Preses Around Outsourcing Software Development, Presented by Neubloc

The Dos and Don'ts of Outsourcing the Design and Development
of Software Products
Many companies have traditionally outsourced software development (with mixed
results) largely because of the financial benefits that are available through the
use of off-shore labor. More and more, it makes sense to consider outsourcing
for additional reasons, including:
 The need to tap into the increasingly global talent pool
 The difficulty associated with building a full team and the associated
infrastructure
 The need to access high-level talent such as design for usability experts,
architects, and program managers

At this Lunch and Learn, Neubloc will cover when (and when not) to consider
outsourcing software design and development. We will look at common pitfalls of
outsourcing as well as covering best practices. While the emphasis will be on
software development, the discussion should be useful with respect to
outsourcing in other areas, including hardware development and business
practice outsourcing.

© Copyright 2009 by Neubloc, LLC. All rights reserved. Phone: (619) 578-2873 | www.neubloc.com

The Dos and Don'ts of Outsourcing
the Design and Development of
Software Products

Armando Viteri
CEO

Bruce Hunter
Director of Business Development

November 18, 2005

Agenda
 Introductions--Tell us who you are and what you’d like to get
out of today
 Overview of Neubloc
 Why consider outsourcing software design and
development
 What to look for in a outsourced partnership
 What to outsource for established companies
 Additional outsourcing pitfalls
 Summary of best practices
 Q&A
 If Time and Interest: Some Neubloc Portfolio Examples


About Neubloc
 We are a San Diego-based firm that helps other
companies build software products such as
 EnterpriseApplications,
 Social Media Applications,
 Mobile Apps, and
 Embedded Applications

 We act as a virtual design and
engineering department for a range
of software companies (startups to
Fortune 500)


Neubloc Services
Product Strategy and Design
 What is your market?
 Who are your users?
 How do increase adoption and reduce training/support?
 How do you craft the roadmap?

 Application Product
Development
 Architecture
 Program Management
 Development
 Test

Embedded Product
Development

Why Outsource Software Product Design?
 Leverage specialized expertise during key periods of
product development
 UsabilityExperts
 Graphic and Creative Designers
 Architects—application level, database level, etc.

 Outsourcing product
design encourages
innovation by allowing
for fresh perspectives
 3rd party validation of
scope and cost

© Copyrigh 2009 by Neubloc, LLC. All rights reserved. Phone: (619) 578-2873 | www.neubloc.com

Why Outsource Software Development?
 Focus on core business versus engineering management
 Fast time-to-market by leveraging existing infrastructure
 Recruitment
 Development infrastructure
 Project Management
 Build System
 Test System
 Bug Tracking
 Engineering Management
 More predictable outcome
 Talent pool
 Access to a global talent pool when local talent is hard to find
 Ability to leverage global talent pool
 Labor arbitrage

 Companies can flexibly expand their development bandwidth when internal
teams are maxed out


But offshore projects do go fatally wrong
 Outsourced vendors can stumble horribly:
 Company failure
 “Double dipping” on resources assigned
 IP theft
 When they are offshore there is little recourse
 Are you going to chase them through their local court
system?
 Most of the time the problems are less obvious but
still serious
 Offshore project management leads to poor implementation or long,
costly delays
 Offshore companies may not have the ability to get the visas
required to get personnel onsite fast.
 Using 3rd party firm as staff augmentation versus part of the team

What to look for in an outsourced
relationship?
 Single reliable established vendor
 US based headquarters, key management and
project management
 Preferably full services
 Design
 Development
 Maintenance

 Critical IP development within the confines of
countries with have IP agreements with the US


What to outsource for established companies?
 Rapid prototyping of unknown/unproven technologies. This frees
resources internally to evaluate results and determine their usability in
the Enterprise
 Reverse engineering of legacy and/or undocumented applications.
Every company has those skeletons in the closet…sooner or later they
need to come out.
 Code Migrations. This requires an enormous amount of time to
analyze cryptic data, set up the transfer process, test and perform the
migration. In addition, offshore works great for setting up and cleaning
up data to prepare the migration.
 Your classic software development projects. Here it is strongly
recommended that your offshore partner is part of the team as close
as possible to inception. This helps to clearly define the scope of the
offshore responsibilities.
 Testing and maintenance. These are major areas for effective use of
offshore resources.
Source: Erich Kreidler, USC

Additional Pitfalls to Avoid
 Hiring a single developer
 Dependent on him or her to finish the project, and to finish the
documentation before they leave
 Single person has to fill many roles, including user interface,
application design, database design, and test.
 Going too long between iterations
 Prevents you from having the opportunity to monitor progress
and to course correct
 Leads to surprises

 Creating a rigid relationship by insisting on fixed costs
 Stifles
innovation
 Focuses time on contractual issues


Summary of Best Practices
 Single reliable established partner
 Make sure there are stateside project champions
With product development, priorities and features change

 Global resources not always attuned to U.S. management
style
 Treat the team like your internal team
 Regular project reviews with updates on costs and
schedules as well as opportunity to review interim
deliverables
 Make sure you consider intellectual property
 Best to deal with U.S. company
 Make sure they back end development is done in safe
places


Questions?


Mobile Check Deposit

Customer: Mitek

End Customers:
Banks


Corporate Learning
Management

Customer: GeoLearning

End Customers:
Corporate Training
Departments


Patent Research
and Management
Application

Customer: Ibex

End Customers:
IP Attorneys

RFID Shipping System

Customer: Eggs
Overnight

End Customers:
Corporate shipping
departments


Storage Device Development
Neubloc is now integral to all aspects of software
development at a Fortune 500 company providing disk
storage devices. Services provided are firmware
development, quality assurance, development of
testing tools and development of core software.
Technologies used are C/C++.


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