Choosing a software sourcing centre

For some time now, India has been recognised as the global centre of choice for offshore software development driven by the twin attraction of a highly educated population and low labour costs. This model, however, is beginning to change, driven by several factors.


Despite its reputation for innovative technology, India struggles to find a sufficient pool of talent to fill the tens of thousands of software engineering and IT services jobs created by companies like Wipro, Infosys and others. In addition, wages in the country have been rising rapidly while Western demand has been cooling in response to gathering economic headwinds.

All this indicates that India’s rate of growth for IT services in the next five years is likely to slow in relation to other emerging economies, which means more sourcing options are entering the frame.

In the quest for the optimum low cost/best practice centre of production excellence, who are the emerging candidates? One of these is China, which has a flourishing IT outsourcing industry available to both domestic and foreign clients, which has grown in parallel with the country’s exponential industrial and corporate expansion.

And ironically, given the current weakness of the dollar, the US may itself become a low-cost/high expertise outsourcing centre for software development and other IT services to today’s emerging economies.

How to source a project

Wherever in the world they are sourced, purchasers are increasingly reluctant leave their software development projects to chance. Many having been burned in the past and now they want to know before they begin A) what they are paying for and B) what they are going to get.

For a European CIO faced with the decision of whether to buy a customised application project from India, China or anywhere else – they want to be able to apply a set of guidelines in order to make the right choice. But given the intangible nature of software, this is not straightforward to achieve.

Fortunately, the Software Engineering Institute (SEI) has created a framework for evaluating and rating IT development organisations called the Capability Maturity Model (CMMI), which provides international best practice standards against which to measure the main elements of an effective development process - from initial project planning to software testing and validation.

These standards and measurements can also be used at the planning stage of a project to get an accurate estimate of how well the end results will meet expectations and how fast the software can be produced.

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