Agile Outsourcing: How Agile is Used In Outsourcing
Agile and outsourcing can be used together to achieve faster delivery, higher quality, lower cost, and access to specialized talent. If you want to outsource some tasks of your internal technology process, you might be curious about agile outsourcing.
In this article, VNEXT Global will provide a comprehensive about agile outsourcing, as well as its approach.
1. A short definition of agile outsourcing
Agile methodology is an approach to software development that emphasizes collaboration, flexibility and customer feedback. Software development outsourcing is the practice of hiring external providers to perform some or all of the software development in-house tasks. Agile outsourcing is a term that describes the combination of agile methodology and software development outsourcing. It allows flexibility and adaptability to both organizations and IT providers, but it strongly requires transparent and consistent communication between two parties.
2. Benefits of agile outsourcing
The combination between outsourcing practice and agile methodology brings significant advantages to businesses:
• Allow companies to scale up or down their agile teams quickly and easily, depending on the project needs and market demands. Applying agile outsourcing teams means businesses can easily stop the outsourcing process when finishing a project without in-house cutoff.
• Enable companies to tap into a global pool of talent and expertise, especially in areas where they lack in-house capabilities or resources. Many IT developing countries such as Vietnam, China… are offering high-qualified agile teams who are 100% English-speaking.
• Help companies to reduce their fixed costs and risks, as they only pay for the outcomes delivered by the vendors, rather than the inputs or outputs. Also, many fixed costs when hiring in-house teams could be cut off such as insurance, commissions.
• Improve the quality and innovation of the products and services, as the vendors are motivated to deliver value and satisfy the customers. Also, each provider will be strong at some specific specializations that you could select.
• Foster a culture of collaboration and trust between the companies and the vendors, as they work together as one team towards a common goal. The constant and transparent communication will also contribute to the open support.
3. Best practices to be agile in outsourcing
• Distributed agile
To create strong partnerships with IT providers and integrate them into the agile teams and processes. This approach involves forming cross-functional squads that consist of both in-house and vendor members. The squads work together as one team, heading for a common goal, using agile frameworks and agile tools. This can improve the productivity, efficiency, quality, and collaboration of the project.
• Good combination of internal and external
Choose the right mix of in-house and external resources for each agile team. There are four main archetypes for sourcing agile teams, which are fully insourced, fully outsourced, hybrid onsite-offsite, and hybrid onshore-offshore. Each archetype has its own advantages and disadvantages, depending on the type and complexity of the project, the availability and cost of talent, the level of collaboration and trust required, and the degree of control and flexibility desired.
• Reputable agile outsourcing provider
Select a vendor that has experience and expertise in agile methodology and software development. The vendor should be able to use various agile frameworks and technologies to enhance the project's performance, security, scalability, and usability. The vendor should also be able to provide flexible and scalable resources, such as developers, agile testers, scrum masters, and product owners.
• Result-oriented negotiation
Negotiate and make a contract with the vendor based on outcomes rather than outputs. The traditional outsourcing model often focuses on inputs (such as hours worked) or outputs (such as features delivered), which can create misalignment between the company and the vendor. The agile outsourcing model should focus on outcomes (such as value delivered) or key performance indicators (such as customer satisfaction), which can create alignment and shared risk between the parties.
• Transparent communication
Set up ways of working together that foster communication, feedback, and transparency. The company and the vendor should establish clear roles and responsibilities, governance structures, escalation mechanisms, communication channels, software testing loops, feedback loops, reporting systems, and performance metrics for each agile team. You should also use tools such as video conferencing, instant messaging, online collaboration platforms, cloud services, and dashboards to facilitate information sharing and coordination.
• Revised partnership
Evaluating the partnership regularly and continuously improving it. The company and the vendor should monitor the progress and performance of each agile team using data-driven methods such as retrospectives, reviews, demos, surveys, audits. You should also identify the strengths, weaknesses, opportunities, and threats of the partnership and implement actions to address them. Also, celebrate successes, recognize achievements, and reward contributions.
Agile outsourcing aims to leverage the benefits of both agile and outsourcing. However, agile outsourcing also poses some challenges, such as finding the right partner, aligning incentives, managing communication, and ensuring quality assurance. Therefore, agile outsourcing requires careful planning, execution, and evaluation to achieve the desired outcomes for software development projects.
If you are looking for a trusted IT partner for agile outsourcing solutions, VNEXT Global is the ideal choice. With 14+ years of experience, we certainly can help you to optimize your business digitalization within a small budget and a short time. With a customer-centric approach, we provide effective and transparent communication, timely and reliable support. Currently, we have 400+ IT consultants and developers in Healthcare, Mobile App, Web App, System Development, Blockchain Development and Testing Services. We have provided solutions to 600+ projects in several industries for clients worldwide. We are willing to become a companion on your way to success.
Please feel free to drop us an email to set up an online consultant meeting to discuss this further. Have a productive day!