Software lifecycles

Outsourcing in IT projects: money saver or money waster?

Generally speaking, outsourcing is an arrangement whereby an external contractor enters into a contract with an organization for the provision of goods and services which previously have been provided in-house. Nowadays, in these tighter economic times, more and more companies are turning to outsourcing as a method to reduce and control IT costs. The primary argument in favor of outsourcing is that services can be purchased for less money than it would cost to develop them. Contractors may be able to provide services at a lower cost through the use of greater management and labor productivity, economies of scale, and the use of skills or technology unavailable before.

The benefits…

First, a huge economic advantage of outsourcing is that savings can result from the reduction of IS staff. Often the cost of outsourcing is less than employing specialist staff and sitting them down in a fully equipped office. Training, and retaining IS professionals is a serious challenge for many organizations. Frequently, having invested significantly in IS employees, organisations loose them, because they have been offered higher pay elsewhere. Moreover, it could be the case that some of the skilled IS staff may only be required occasionally. Outsourcing shifts this human resources problem from the organisation to the vendor, which can result in significant cost savings.

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Agile vs. Traditional software methodologies for successful government IT procurement

Although many people would not agree with me, I personally think that standalone agile methods would not be as successful as the UK Government think they might be, when applied to public sector organisations. In my opinion, in order to successfully tackle the problem and reduce the risk of project failure, a mixture of agile and traditional software methodologies should be put into practice for a number of reasons.

As always happens, large IS projects are exposed to adverse influences, the so called project risks, which may result in delaying the timely completion of the project, increasing the cost or reducing the final quality of the product. Project risks affect all aspects of a software project: the organization, the personnel, the technology etc. and can prevent the intended benefit of the project being realised.

All these different types of risk at which a complex IS project is exposed to, should be taken into account by public sector organisations. Some of these risks can be successfully reduced or even eliminated by using the right software development methodology and it is up to the UK Government to make a decision between agile and traditional methods, or as I suggest, a mixture of both.

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