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M ANAGING PROJECTS IS HARD. Scope creeps, changes go uncontrolled, defects are introduced,

schedules are delayed…and that’s all in your own organization, where your software
engineering team is right down the hall. Imagine how difficult it is to get even these
results when your team is in another organization in an entirely different building—and
possibly in a city halfway around the world! When you hire a company outside your orga-
nization to build your software, you open up yourself, your project, and your organization
to exactly these problems.

Unfortunately, that straightforward reasoning seems to be lost on many people. The fact is
that outsourcing is risky, and many people find that their projects go awry. Gartner, a
respected research and consulting group, recently (at the time of this writing) published a
report that predicted that half of IT outsourcing projects in the next 2 years will fail, and
that 60 percent of organizations that outsource customer-facing processes will find that
hidden costs and customer problems have wiped out any cost savings. This implies that
leading an outsourced project requires a different set of skills than most project managers
are familiar with. If you are used to working with an in-house team, you personally will
need to change your approach to project management if you want to get your outsourced
project done right.
There are a lot of overly optimistic books, articles, and papers written about outsourcing.
Mary Lacity and Rudy Hirscheim propose reasons for this phenomenon in their book
Beyond the Information Systems Outsourcing Bandwagon. They point out that much of the out-
sourcing literature is written during the “honeymoon” period, after the contract is written
but before any project milestones are met (or blown). Many only report projected savings,
not actual savings. And most of all, they point out that only the successes tend to be docu-
mented, because few organizations want to publicize their mistakes.
The truth is that the project manager for an outsourced project faces all of the challenges she
would face on a project developed within the organization, plus a slew of additional difficul-
ties. However, if she is able to navigate these issues, she can lead a successful project.

Prevent Major Sources of Project Failure

By getting involved in your software projects and not leaving all of the decisions up to the

vendor, you can prevent many of the most common causes of outsourced project failure.
Get Involved
There’s a broad misconception that it’s possible to somehow extract the work from an out-
sourced project team without getting involved in the day-to-day management of the indi-
vidual team members and their tasks. The conventional wisdom goes something like this:
you’re paying the vendor to handle all of the management overhead, so they should also
be able to handle any personnel management problems that arise. This might work in
some instances, but in other cases, it leads to a client who is unhappy with the vendor,
and to a vendor who does not really interact with the client.

256 CHAPTER ELEVEN