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Recently it Outsourcing created a lot of buzz after Intel decided to consolidate their outsourcing to a single contractor only i.e. Infosys India. According to reports, several Tech giants have had job cuts or layoffs due to shifting of job roles towards the Cloud, automation by Artificial Intelligence, tool based analytics etc.

Business leaders such as CIOs or CTOs may find it a challenging task to adopt an appropriate management style for their organizations. We all know that Agile is the most widely accepted and suitable approach in a Startup or a SME where each employee is provided with the autonomy of execution of goals that collectively leads to achieving organizational goals. This approach is also tried at large corporations such as BMW.

In this aspect pliXos likes the article by Forbes dealing with Agility at start-ups and small organizations and the changing needs of leadership in case of a growing organization. The article claims that “Growth needs new level of Management”. This means that at every stage of an organizational restructuring and expansion, leaders should work in close collaboration with their subordinate teams to supervise the team’s objectives within the scope of strategies and frame of work decided by the top management.

Agile vs Top down pic 1

Pic 1: Agile combined with Top Down methodology in Software Development Outsourcing

In case of it outsourcing, Agile has a good track record of delivering customer oriented products, where alterations, iterations, customer reviews and feedback created at each step makes the applications more suitable to users and adds value to the end product. However, especially in case of larger projects a certain level of top down guidance is necessary to keep the teams and the outcomes in line with the expectations by management.

This top down guidance is – according our understanding of best practice – supported by a well set governance. Already in articles in 2011 as well as 2015, pliXos founders emphasized the benefits of an agile approach combined with an automated governance:

Agile vs Top down pic 2

Pic 2: “Divide and Conquer” – Historic Strategy Applied for Large Scale SW Projects by Building on Agile Process and Automated Governance as proposed by pliXos in 2015

A simple example of outsourcing of technical services by banks can be a fitting scenario where amalgamation of Top Down Management approach with Agile can be interpreted quite clearly. Global banks like Deutsche Bank, Bank of America, Scotland Bank etc. sometimes feel the need to outsource technical consumer banking services to offshore locations.

These banks have global customers and hence the need to execute on a global scale plus using synergies being present at certain regions or countries. Depending on the specific need, they may choose smaller local providers or one of the big sourcing giants. These service providers offer compatible software development solutions and maintenance services to serve the banks.

For executing such globally distributed software projects, service providers have to work in close collaboration with the bank and for this minimum two project managers or leaders are usually responsible for the smooth flow of work at both sides, supported by a proper set of tools. Doing this, the banks ensure that their work is heading in right direction and their data is secured.

At the lower level, the executives who work in progress of project have a well-defined set of work instructions and strategies made by their leaders respectively. Failing to provide required framework by leaders, managers, CIOs will give employees full freedom to experiment and adopt the development functions at each stage of projects on their own.

This is not a good decision to do in outsourcing environment as it may lead to failure too and adds more risks to the project. To avoid these circumstances, Organizational or Top Management strategies/goals & key objectives should also be the priority along with the team’s internal objectives. At this juncture of time a little motivation from Top down approach style proves healthy for project and keeps processes in synergy with the clients.

Thus, saving the overall project much better than it would have been in an all Agile methodology of software development project alone.

Why it is essential to have a close collaboration between the customer and service provider for successful outsourcing?

The answer is transparency and continuous alignment. Indeed, transparency is one important aspect which beholds the projects strongly and if practiced efficiently can bring outstanding results. In short transparency should be the core value in software projects. Making informed and data driven decisions by the top management requires tools that help to fetch important analytical data in real time.

Earlier it was not possible to manage a globally distributed projects in real time by the leaders and top management of companies in order to keep things aligned and in place. But now thanks to digital disruptions, SaaS (Software-As-a-Service) tools by companies such as pliXos (a German based IT Consulting Firm with own SaaS products) have proved beneficial for organizations while considering a software/application outsourcing project.

Moreover, pliXos tools such as Outsourcing Advisor, Tender Manager and Outsourcing Director in integration with B2B Marketplace provides transparency and efficient control of projects which are building on globally distributed teams.


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