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December 14, 2017

Pt 1: How to Select an Outsourcing Vendor in Three Steps

Hiring an outsourcing vendor is like hiring the employees on your internal software engineering team.

Yet many companies don’t know how to select an outsourcing vendor -- many go through the selection process as if it were a purchasing process, seeking the lowest price for a service that will satisfy all the “requirements.” But more often than not, that doesn’t always go the way it was planned.

Did you ever purchase an employee for your engineering team? Of course not. Hiring an employee takes a careful evaluation of candidates through interviews and reference checks followed by a reasonable negotiation over salary.

Sometimes you have a choice between two or more employee candidates. Do you negotiate hard so you can hire one of them at the cheapest salary? Probably not. If you do, you risk hiring an employee who will stay only until a better job comes along elsewhere. And then you’ll have to start the long hiring process all over again. It’s the same for an outsourcing team. Negotiate too hard and there’s little incentive for them to perform well. You frequently hear stories about people who have gotten bad results with their outsourcing. Oftentimes these stories involve a small outsourcing team that took a project at a low bid out of desperation for new business. Do you really want to work with an outsourcing team that’s desperate? If you negotiate a deal that’s too good for you, you’ll get the results you deserve.


How to Select An Outsourcing Vendor: A Three Step Process

Are you overwhelmed with the number of software outsourcing vendors? It’s amazing how many there are -- and they all seem to have come out of the woodwork in the last couple years. One Accelerance client put it this way:

"It’s like we are walking down the shampoo aisle at Wal-Mart and we don’t know what to buy. There are just too many choices!

You want to take advantage of the real and substantial savings of global software development, but you don’t want to waste time and money learning how to do it. In today’s fast-paced and cost constrained world of software development, no one can afford a long learning curve and the expense, in both time and money, of making a mistake.

Therefore, you need outsourced engineers who work together as a cohesive, professional software development team, following a well-defined software development process. Your team needs to be experts in the technology you need. You want to find a team that can quickly execute your software. But how do you do it?


Here’s a three-step process you can follow to select the best outsourcing vendor for your software development:

  1. Source: Find vendors you want to consider. 
    Search Browser - Outline.svg

  2. Screen: Apply an objective set of criteria to narrow down your choices.
    Checklist - Outline.svg

  3. Select: Look in more detail at your finalists and select the best one.
    1st Place - Outline.svg


Pretty straightforward, right? So why don’t others just follow these simple steps and achieve success with outsourcing? Some do. But most get distracted by the details, especially if they’re already running a company or software development organization.

In the next part of our series, we’ll dive into each step in more detail -- from finding the vendors you want to consider to looking in more detail at your finalists. Stay tuned…

Check out Pt 2: How to Create Your List of Outsourcing Vendors and Pt 3: What Should You Look for In A Software Outsourcing Vendor?

Andy Hilliard

As CEO, Andy leads and advocates for the globalization and collaboration of great software teams with companies in search of talent, innovation and a globally-distributed extension of their engineering function and culture. Andy founded the ground-breaking nearshore software development services company, Isthmus Costa...

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