The Software Outsourcing Show is on a mission to explain best practices for strategies, partner selection and ongoing management of outsourcing your software outsourcing development. This episode of the Software Outsourcing Show features Jim Marascio, Chief Delivery Officer at Accelerance.
Bobby and Jim discuss how searching online for outsourcing information isn’t always the most efficient method to finding the right development partner. You cannot implicitly trust Google and the over 70 million results provided when you search for ‘software development outsourcing.’ You need an in-depth analysis of your proposed team and we’re sure you don’t have the time to sift through hundreds of companies to analyze and select your perfect team. That’s where Accelerance comes in.The Software Outsourcing Show is your #1 source for information, lessons learned, and exclusive insights into outsourcing. The show is produced by Accelerance, the leading consulting firm dedicated to helping companies reduce risk with software outsourcing.
Bobby: Hey, Jim, welcome back to the show. Glad to have you in the studio again and always appreciate having you here.
Jim: Thanks, Bobby. It's good to be back. Before we dive into the show, I want to let you know something I heard yesterday. So I was actually speaking with someone in Pakistan who had just listened to the show, a past episode of the show and was complimenting you on it. And earlier in the week, I talked to somebody in Kansas City, so a little closer to home. But I guess you know, the word is getting out. We're only, I don't know, a handful or two handfuls of episodes in and you're making some waves. So, kudos, keep it up.
Bobby: Well, thank you. Thank you. It's always great to be world famous. So shout out to our friends in Pakistan and in Kansas City. And thanks guys for listening to the show. Tell your friends about it. Let's see if we can get up there on the iTunes chart. That'll be our next goal, right?
Jim: Let's do it.
Bobby: Well, Jim, I thought what we would talk about today...we've talked about this a couple of times before is searching online for software outsourcing. And I know we've brought it up in our episode when we talked about outsourcing to India and actually even I think in our very first episode, we hit on it a little bit talking about, you know, what the heck is software outsourcing? You know, the funny thing is, is Google search is probably the go-to for anything these days. Would you agree with that?
Jim: I am not a Bing person so, yes, I would agree with you.
Bobby: I've also, you know, just as a little sidebar, I've learned a new term this week. Have you heard Googling right?
Jim: I have not. Is that a variation of AltaVista?
Bobby: No. Actually, what it is, is so you know, usually you say, "Oh, I don't know if that's true." So you Google the answer. When you Google right, you're Googling to find the one obscure reference that backs up your case to prove that you're right.
Jim: Uh-huh, that's a skill I need to start mastering especially in preparation for the show with you.
Bobby: Apparently I've been doing that a lot and I didn't know, but I was informed this week that that's the thing that I was doing so I thought it was interesting. But, anyway, I know we've talked a little bit about challenges in searching for a software outsourcing partner of mine. So I know where we all start is we think, "Gosh, I really need to find out more about this." And so I go online and I search. And we did, in prep for the show, did a little research on this and I thought it was really great. So if you just go...
Jim: Is it difficult to Google, right?
Bobby: Yeah. Well, if you just search software outsourcing companies, do you wanna take a rough guess of how many results you would get back?
Jim: I don't know. It's got to be in the millions though.
Bobby: Oh, absolutely. It was 56,200,000 results. So we said, "Okay, well, you know, come on..."
Jim: That's a lot of next page, next page, next page.
Bobby: That's quite a few pages, right? If you spent, what, five minutes trying to go through and vet each one, that's more than a lifetime. So we said, "All right. Well, a good person, a smart person..."
Jim: Outsource that to someone to do.
Jim: We may be on to a new business model here.
Bobby: Yeah, there we go. Well, you know...
Jim: Maybe we can help our listeners find a more efficient way.
Bobby: Well, we said a smart person, a smart person would go in and see something like that and go, "Oh, my gosh, I gotta narrow the search." So we said, "All right, let's look. Software outsourcing India." And it is true, it did narrow the search. That brought us down to 37,400,000 results.
Jim: Okay. Progress but still unmanageable.
Bobby: And then we said, "Hey, you know, we've talked about this on the show. We've talked about this. You know, India is the is the big great granddaddy of outsourcing, right? That's where it all started. You would expect to have a lot of results from there. Let's pick a couple other countries. Let's find something else." We said software outsourcing Poland. People don't think about Poland a lot when we think about software outsourcing in the States. So let's go there. That should clearly narrow it down.
Bobby: It did, 10,400,000 results. So we said, "Okay, well, let's get really, really specific. We're going to talk about software outsourcing in India and let's take blockchain. Blockchain is fairly new, kind of a new thing, there's not going to be a lot of people out there doing blockchain so let's try that and see if we can narrow down again." I'm happy to report we narrowed down again. We actually got the smallest number in our research. This was totally official, a complete academic review. Of course not. But this was our smallest number, 8,570,000 results.
Jim: Wow. So still almost 9 million.
Bobby: Right. Yes. Still more than a lifetime if you're talking about trying to find someone and vet them. It's just it's there because we know that the top results, you can drop down and find organic but really even when we're looking at organic results these days, that just means that that firm is really, really good at SEO.
Bobby: They're really good...
Jim: And imagine how many more there would be if more people were good at SEO.
Jim: Because I can tell you we found some good companies that are not good at SEO.
Bobby: Right. Yeah, absolutely. Absolutely. And just because you're good at a getting up there in the research results doesn't mean that you're actually good at what you can do. It means you're really, really good at marketing. So to that point, if you're looking for a marketing firm to outsource to, you probably wanna take the person that's at the top. There best one to have found you. I thought that was interesting. I mean, clearly we can all see past the paid ads where people pay to get higher in search and that's there. But I just...I thought that was interesting and I think that's a parallel that we see with a lot of people. Would you agree?
Jim: Yeah, absolutely. The two things I hear when I ask companies, "What have you done?" Or, "How are you approaching this today?" is number one, you know, far and away is Google or some kind of internet search and exactly what you're describing and they're encountering the types of figures you're describing, even if you do make it more precise by adding certain keywords for technologies or industries or what have you. The other thing is they ask somebody they know, "Who did you work with? Did you ever get experience?" And that type of thing. But there needs to be more done.
Bobby: Right. Absolutely. And we do see a lot of asking a friend, "Hey, who did you use?" But the really the technology landscape, I mean, just because someone was good at that last event doesn't mean that they're going to be good for your event.
Jim: Yeah, exactly. Or that your application is similar enough that they may have comparable expertise or relevant.
Bobby: So let's talk a little bit about... So online search is one way, but that's not really vetting the partner, right? Just because they came up in the search results then you really got to start kind of vetting your potential partner. Where are they? And we advocate this on the show all the time that it's best to just go and see them.
Jim: Absolutely. But you can't get see eight million companies. Maybe I could but it's not the most efficient.
Bobby: Yeah, you're not going to do it in a lifetime, not eight million. So let's talk a little bit...What I wanted to talk about today is move that and say, "Okay, we admit everyone is gonna do online search. That's where you're going to start. But let's talk about due diligence."
Bobby: We practice a lot of due diligence here. And really you've got to look at the company as a whole. So I know really, one of the first things that we look at is experience and qualifications. Wouldn't you say that's probably up there.
Jim: Absolutely because that's where it starts. That's really kind of the first criteria is is it even relevant? Before I do any in-depth qualification. How relevant are they with experience? And that generally boils down to two things. Are they using the technologies we want to use? And do they have relevant experience in our industry? Or in some sort of application comparable to what we're trying to build.
Bobby: Okay. So can you give me a little example of that or...
Jim: Sure, sure. So there's dozens if not hundreds of languages and various languages. In fact, Hugh and I were having a conversation yesterday about I think it was Angular and which version of Angular and whatnot. So it's important to understand if you're working with existing code and existing languages and you're augmenting that or adding to that are building upon it, do we have a company here that has expertise with those technologies? If you're building from the ground up, it's a matter of finding a company who has the ability to architect a solution using the most appropriate technologies.
And there's lots of options with pretty much any type of solution. There's rarely only one path to take. But every...there's that old analogy of if the only tool you have a hammer, everything looks like a nail. Well if your expertise is only in one technology or a small subset of technologies, you may approach or the company may approach with only those technologies and they may not be the most appropriate. So finding companies that can architect appropriately and utilize one of the more appropriate technologies for that solution is really critical.
Bobby: And I think that's interesting because you really kind of hit on one of those second areas that we talked about. So it's experience and qualification, but it's also the technical expertise. So just because they've been working with it, how deep have they worked with it? How long have they worked with it? How well do they understand it? Are they thought leaders? Are they providing feedback to that particular piece of technology? Correct?
Jim: Yeah. I actually look at them a little bit different. One is the expertise in that area and choosing the right technology for it. When you get into true technical expertise, to me that's more about how they do something. The first thing we talked about is choosing the right. What are we going to use to do this? The second is how are we going to use that tool appropriately? So just because a company knows what to use...I can find a guy outside Lowes or Home Depot with a bunch of tools, but does he know how to use them and does he know how to use them appropriately for the work that I have to be done? And that's really, to me, what the technical expertise section is.
Bobby: That is a very good...I like that analogy because I was thinking, you know, some work around the house not too long ago. There was a contractor I found that honestly had been doing it 10 or 15 years, was going to do something for me. And potentially did the worst job I've ever had done in my life.
Jim: You should have checked references.
Bobby: I checked references and everybody was like, "Oh, yeah, he's done work for us. He's done work." And honestly, I think what I did is I just asked him to do something that was a little more outside of his comfort zone. And while he had experience doing it didn't mean that he did it well.
Jim: Sure. And that translates to any type of work. So when we're talking about software development here, it's a matter of how do they do what they're doing. Just because they know...just because I know how to drive a car doesn't mean I can drive a race car in a race. And so it's how are they going to approach that? What qualifications do they have? What is their process? What are those procedures? And how does that fit into our organization as well?
Bobby: Right. Absolutely. That doctor might have done 500 operations but, you know, only 50 people lived. Is that the doctor you would want?
Jim: I can say it depends on the 50 people, but I won't.
Bobby: True. So experience and qualifications. We talked about technical expertise. Cultural considerations is really in there too, right?
Jim: Absolutely. You know, I like to say, you've heard me say it before, they're smart people everywhere. But some of this is how well are they going to work with you and your team? So it's important that we be open to working with those smart people wherever they are. But there's always considerations around things like, what are their work hours? Are they gonna adapt to that? How do we communicate with them? And I don't mean to get ahead. But culture factors into that. So understanding what considerations you have to have with respect to working with an organization. There's organizational cultures.
A lot of times when we think outsourcing, people are thinking immediately, "Oh, what's the culture in India or the culture in the Philippines, or Ukraine, or in Brazil?" or wherever we're talking about. That's part of the solution but there's also organizational considerations and you've got to look at how is this company going to align well with us and ideally compliment us or, quite frankly, make us better?
Bobby: Right, absolutely. We've talked about that several times. I enjoyed talking to one of our clients earlier this week. They've got a perfect marriage between the client and the software partner. And every time I talk to him, he's like, "You know, I feel like we're the poster child for how well this is going." Because culturally as an organization, they just fit. They work well with one another. And it's unbelievable. So that's a strong win.
Jim: Yeah. I like your use of the word marriage there. Sometimes I call some of what we do as marriage counseling. But in a good marriage, the other person makes you better and in a good partnership with a business, the other company makes your company better and, quite frankly, makes the other company better. So understanding how the...again, coming back a little bit to the technical side of how do they do what they do? What are their processes? What are their expectations? What are your internal processes and practices? How well are those going to marry? And understanding the cultural consideration of the culture that these people, wherever they are in the world are coming from. But also not only the country culture or the region culture but also the business and organizational culture.
Bobby: Absolutely. And you hit on that earlier too, really, you can't talk about culture without talking about communication. I really feel like those two go hand in hand. And that's really one of the fourth criteria that we look at is communication skills. So let's talk a little bit about that. Communication skills.
Jim: Sure. Yeah. So one of the things I really like to do with our clients is something we workshop and when we kick off an initial engagement. There's a number of how do we work together type items that we talk through with the client and the software outsourcing partner together. And one of them is communication specifically. And we will literally spend an hour or 90 minutes to hours talking about how do we communicate? When is it appropriate to communicate? What cadences? Who communicates with who, when, and where? How often are leadership going to meet?
How often do the developers communicate? Are their daily stand ups? What's appropriate via email? What gets communicated via Slack? What gets communicated via something like JIRA? So understanding that type of communication is critical. Also understanding the cultural communication is critical. Americans tend to be very direct. They are very literal or things tend to be black and white. We don't kind of paint around the edges, we just generally, and I'm generalizing here, there are exceptions to every rule, but in a general sense, Americans and Westerners tend to do that. Eastern Europeans tend to be very direct in that way as well. Again, I'm generalizing.
But more often than not, you'll find that in those cultures, people are brought up that's the way they tend to communicate. People in Asia tend to be less direct. They tend to kind of paint a picture and let you interpret it in their words. So somebody may say, "That would be difficult to do," when they mean no. And so it's important to understand that. And Latin Americans I find tend to be a little in between. And again, I'm generalizing. I'm not trying to stereotype, but I think it's important to spend some time talking with them and understanding what they do. There's also a great book called "The Culture Map" that talks about working across cultures and across countries.
And there's a section in there that talks about communication specifically. It's a book by Erin Meyer. I highly recommend it. So communication is really two things. It's what and how do we communicate and with whom and when, and then it's understanding that cultural element of communication and the nuances so that things don't get misinterpreted. And if you go into a relationship, a business relationship and understand those two things and take some time to talk through those with your partner, on the front end, I think you'll find that you'll be more successful.
Bobby: I totally agree. And I get where you're coming from, too. When we talk about different cultures and we talk about different countries, it is broad generalizations. Because I was actually laughing when you said Americans and Westerners tend to be more direct. Having Southern roots, I at times I'm very indirect. I mean, it's direct but you have to have a southern decoder ring. Correct?
Jim: I don't understand. What do you mean? I'm a Yankee. Displaced to the south. New Englander. No, I'm joking. No. Yes, yes, I am.
Bobby: So the last thing really, too, that has to be talked about...unfortunately, we've seen the bad side of this too and that's protecting intellectual property. You've got to have something in place. You've got to make sure as you're dealing with this firm how you're going to protect that intellectual property, correct?
Jim: Yeah. This isn't something important. And what I find is clients are either oblivious to this or this is the only thing they focus on. And they come in really concerned, come into the relationship or really hesitant to even outsourcing, whether it's domestic or offshore and inshore because of this. And what I think is really important is as you start to have conversations with a software development partner, and all of ours, we've prevented around this. But if you're doing this independently, you need to have a conversation about what's included in the contract. Who's going to own the code? Where is the code residing when it's being developed?
Is it in our environment or environment that the client controls? Or is it somewhere else? And I would say it should not be somewhere else. It should always be...there are two things you need to look for and every one of the companies that we work with do it this way, is contractually, it needs to be very clear that who owns the IP, who owns the code, who owns any derivatives of it, that type of thing. And two, where do things reside virtually? Because I was going to say physically, but that's not true. And I think it's important that it's an account controlled on servers or in a cloud environment that's owned by the client and that needs to be outlined and very clear.
Bobby: And it happens more than people think. I was with a very large organization that must remain nameless. And as you know, most of my career was around scaling, right? I didn't start with proof of concepts or minimally viable products. I usually came in somewhere after version one and helped scale up. And this organization that I was with, we started to help scaling up and they...you know, we were going through what was called the internal sourcing because it was.
It was a large enough organization that what they had done is hired someone to help them with the POC, with their first version and then they decided to build out a team to do it in-house and to use some existing outsourcing partners that they had and subsidiaries they had done years before. And as we started trying to bring it in, all of a sudden, we realized the people that had signed the contract, we didn't own the code. We had a lifetime lease on the code but we didn't own it. And that made for some very, very interesting conversations and there was some patents filed around the way some of the stuff was approached and we didn't own it.
Jim: Yeah. It's like anything else. You know, it's almost, again, use your marriage analogy from earlier, it's kind of like a prenup. So I think it's important at the beginning of any business relationship to clearly outline and agree upon all expectations. And you absolutely should be asking about this. And if you work with any of our partners, we've pre-vetted that but I still encourage you to validate it, but we've done that. And I'm sort of hung up on your internalficatoin. It sounds painful.
Bobby: I know it did. I thought we could have come up with a better word but that's what we called it for a while. So anyway, in just recapping because we're about out of time, really, when we talk about due diligence, it is five main things that we say that you got to look at. It's experience and qualifications, technical expertise, cultural considerations, communication skills, and making sure you've got protections in place for your intellectual property and your IP. So with that, I'll wrap it up and it wouldn't be the software outsourcing show if I didn't have somewhat of a content plug, right?
And that's going to be for our 2019 software outsourcing due diligence guide. It's out there. It'll be in the show notes. We'll have a link to it. It covers all these things that we say that we look for and gives you ideas of where to go. It's more detailed information on those risks. And actually, some sample due diligence questions that we encourage you to ask if you're getting ready to do some of this due diligence work. So, as always, I'm gonna say thanks for listening to the show. You can always find the latest episodes and show notes out on iTunes and SoundCloud, and of course, at the softwareoutsourcingshow.com. Jim, thanks so much for joining me again this week, and I look forward to having you back on the show.