Outsourcing – 4 success factors for a functioning long-distance relationship

Published on 14. October 2021 by Michael Hofer under Categories1stQuad

In my 20-year IT career, I have repeatedly had to deal with outsourcing. Especially in “creative” and complex software development, this has often not worked out as desired. However, this article is not intended to describe what can go wrong or where exactly the most resources can be found at the best price. I’d like to highlight four approaches that have helped us achieve many successful software projects and stable teams with minimal turnover over the past decade. This is about the small, personal things and not about the MBA learning book or outsourcing in the global corporation.

Let’s get this straight up front: At its core, successful software outsourcing follows the same rules as a long-distance relationship. Just like a long-distance relationship, it takes greater effort to turn the “first crush” into a long-term, successful partnership. Here are four factors that will help you succeed:

Success factor 1: Choose between culture and structure

In short, the bigger the cultural gap, the more structure you have to provide. By structure, I mean the amount of guidance, specifications, controls, and other measures that ensure that the project is implemented as intended.

On the one hand, the term culture has a geographical meaning: the less familiar or the more distant a culture is to us, the fewer conclusions we can draw about how our messages are received and whether they are interpreted correctly. But culture also has other dimensions: Stinginess is not cool, and generosity, trust and goodwill are the foundation of any long-distance relationship. If you want a long-term commitment, you shouldn’t cut corners.

Ultimately, it’s important to create a culture of “we.” A few times, a project or delivery manager was placed by the outsourcing partner as a “gate keeper” between us and the development team. This person may well have his or her role, but should never impede direct contact with the team. Every single member should be able to exchange information with the whole team. If we don’t know each other or if there is an intermediary, the risk increases that messages don’t reach the sender or are distorted. Especially in very dynamic projects with little time, budget or a still very new technology, this is a big risk.

Success factor 2: Franchise players

In US professional sports, “franchise players” are touted as the key to success. If the team is set up in such a way that it optimally supports the franchise player, these superstars can influence individual games or entire seasons.

Such superstars can also be harnessed in software development and outsourcing. Always do a pre-project or prototype with a new vendor. This way you can not only determine if the culture and other important factors are right, but also identify the franchise player(s). Build the team around that person(s) and their strengths. Once a team reaches a certain size (which varies by composition), you need to find more franchise players and build the next “team,” ideally as independently as possible.

You can also use this method to think about the roles in a team: especially strong business analysts or testers should receive suitable additions so that they are even more effective and pass on their excellent knowledge and, above all, their way of working to others, which strengthens the team. Finally, it should be mentioned that the most important quality of these franchise players is their loyalty. It weighs ten times more than outstanding technical skills. After all, we want to build a dynasty and not just play for one season, don’t we?

Success factor 3: Personal exchange

Nothing compares to a face-to-face conversation. Video conferencing is fantastic, but it can’t replace the countless little things you notice when you’re with someone in person. Even though it’s difficult to talk to everyone in person on a large team, give it a try!

The Belarusians from our team, with whom I walked the streets of Minsk late at night a few years ago, are still personal friends and support me at any time of the day or night, without hesitation.

So visit your outsourcing teams or, and this has proven very effective at least before COVID, invite selected team members to visit you regularly. This “fringe benefit” shows appreciation (see later), brings additional motivation and is often also a unique selling point in the recruitment process.

During the exchange or visit, it is most important to meet at eye level: On our first visits, we were received like foreign kings. They took us to the most beautiful meeting rooms, organized a program for us and always wanted to hear what we were planning next. A business visit from the client, after all. But this is only useful if you want to negotiate a new contract with the management of the outsourcing partner.

If you want to reach your team, you are one of them. When I visit our teams, I like to sit at a desk in the middle of the team room and do my work from there. And of course, we go to the cafeteria together and eat or have something delivered. Occasionally, I also invite the team to eat with me. As an appreciation and to spend some quality time with a great team. And that brings us to the last and most important success factor:

Success factor 4: Appreciation

As in a relationship with another human being, showing appreciation and respect is critical to success when outsourcing work. Small gifts keep the friendship, so goes an old saying and we live this by regularly surprising our distant friends with small gifts or occasions (e.g. another successful go-live).

It doesn’t take many big things, it’s more important to involve team members in decision-making or solution-finding processes. That’s why we occasionally invite team members into discussions with our customers. They don’t necessarily have to have an active part, but this is seen as an enrichment by all sides and the colleagues then contribute to design decisions or have even brought them in themselves.

The resulting solutions are not unexpectedly the ones that work best. And please do not forget: Appreciation goes both ways. It is also a great feeling to feel that you are not perceived as a customer or client, but as a valued colleague or even friend.

This was my personal view on four success factors for a successful outsourcing business in the world of software development – both in economic terms and especially when it comes to human relations. My colleagues and I do not see software development outsourcing as a threat, but as an enrichment for our everyday work. I am very pleased with the many positive and negative experiences I have had with outsourcing over the past 10 years and hope to contribute something to your successful “long-distance relationship” with this article.