Offshore Development Work Getting High Marks

By CIO Update Staff

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The Software & Information Industry Association (SIIA), the principal trade association for the code and content industry, today announced the release of a major survey and report on the current state of global software development.

A sampling of the research results highlights from the the Global Software Development Survey indicates that companies are increasing their global development efforts: 57% of the participants have significantly increased offshore work in the past 18 months and many plan to add still more in the next 18 months.

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Growth strategy was cited as an "important" or "critical" driver for 84% of respondents, while increasing speed to market and productivity were the next most important drivers.

No single business model was cited as optimum for offshore development, with roughly half of respondents working with an offshore provider, a third operating a subsidiary or captive (employed by the company but working overseas), and a quarter employing a hybrid model of both approaches.

Major findings from the survey, developed with assistance from Symphony Services, a global product engineering outsourcer, include updated information on the type of work being done offshore; the drivers for globalization such as growth strategy and increasing speed to market and productivity; and the fact that companies are achieving their desired goals in current offshoring projects.

"Global software development is in the process of transforming the nature of the U.S. software industry," said Ken Wasch, SIIA president, in a statement. "Our survey covers many of the influences on and results of this sea change."

The specific objectives of the research were to determine:

  • The overall impact of global software development on companies.
  • The current use of various business models.
  • Global software development's impact on productivity.
  • The success of offshoring activities.
  • Challenges associated with global software development.
  • Attitudes of companies not currently offshoring.
  • Potential future changes in global software development.

    Respondents claim to be achieving 80-to-100 percent of their cost savings goals. While gains in productivity appear to be less than expected, 73% of respondents reported a positive impact on profits.

    In addition, fully two-thirds of companies who work offshore claim the quality of work is above average when compared to onshore staff, with 25% rating the quality as "excellent" or "outstanding."

    Copies of the report are available to non-members at the SIIA eStore for $395.