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The Unsung Virtue of "Business Process Outsourcing" - It Sucks

The Unsung Virtue of "Business Process Outsourcing" - It Sucks

(November 11, 2003) - The Law of Unintended Consequences is something Keith Franklin, president of Empowered Software Solutions, has believed in passionately ever since his company earned $500,000 in revenues from fixing buggy software written in India. According to no less a source than BusinessWeek, .NET Developer's Journal editorial board member Franklin and his team recently devoted 5 whole months to repairing "a glitch-filled application for a Web portal." Worse of all, for the customer, was that the Indian outsourcer went $1 million overbudget - whereas Franklin says Empowered could have done the project for less than $900,000 right here in the U.S. "When you parse it all out, the total cost of offshoring a given IT job is generally comparable to getting the work done domestically," Tom Weakland, a partner at management consultancy DiamondCluster, tells BW. "Most companies can't accurately measure their productivity and costs prior to and after outsourcing," Weakland continues. "Most look just at wages." "As Empowered Software has discovered," the BW piece continues, "programs developed by offshore outsourcers are also often buggier than software programmed domestically -- usually 35% to 40% more so. "If a company makes software for flying airplanes, I wouldn't want [it] to be created with the priority of the deadline coming first and quality coming second," says Michael Mah, managing partner at software consultancy QSM Associates, based in Pittsfield, Mass. And if a financial application used by, say, a bank distorts crucial information such as trading data, a customer could sue or withdraw its business. Should such problems arise, the U.S. company can't easily turn around and sue its applications-development outsourcer overseas. Fixing even small bugs can cost up to 10 times more after the software is written than at the design stages, Mah says.

More Stories By .NETDJ News Desk

.NETDJ News Desk monitors Microsoft .NET and its related technologies, including Silverlight, to present IT professionals with news, updates on technology advances, business trends, new products and standards, and insight.

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Most Recent Comments
Anon 11/12/03 05:37:16 PM EST

Quality of BPO ranges in a wide spectrum. Just as there are good software companies in the US, there are extremely proficient software development firms in India(& outside US) who have managed to wrest contracts from biggies like Anderson Consulting, KPMG. Not to mention that Microsoft, Oracle and Intel have software design and research labs in India.

I do agree with the author's views that not all birds are of the same feather.