How to Evaluate Prospective Partners for Software Product Development v How to Evaluate Prospective Partners for Software Product Development Insight, and Scorecard By Sheenam Maheshwari Nagarro White Paper 1 How to Evaluate Prospective Partners for Software Product Development Introduction Software product development with outsourced partnerships can make or break your corporate success. Finding the right partner and establishing careful terms for the shared enterprise will be critical. What’s the best way to evaluate prospective partners? Which factors are key? This white paper offers perspective on several important issues, as you compare possible partners for software product development. In addition to providing deeper insight, this paper also contains a comprehensive scorecard to help you evaluate the various partners you are considering. Finding the right match between your needs and the partner’s capabilities can make the difference between success and failure. Beware of Blind Spots With nearly two decades of experience as a global provider of business-critical outsourced software development services, Nagarro has worked with a broad range of product companies, from start-up to later stage enterprises. We’ve seen a variety of approaches to the selection process for software development partnerships. While most companies have a basic idea of common criteria to explore with prospective partners, we’ve found that certain criteria tend to be overlooked in all the “noise” of the selection process. If you’re responsible for choosing the right partner, you should pay special attention to these important factors noted below. Don’t allow them to become blind spots in your evaluation, because they will make a big difference to the success of the partnership, and the quality of the end product. LOW ATTRITION RATES & STELLAR PEOPLE MANAGEMENT Seek a prospective partner that excels at motivating and managing its own workforce, for this should yield a more stable and consistent foundation for your long term partnership. Top human resource management practices at the partner’s firm will pay rich dividends to the stability of your product development. Look for low turnover as a leading indicator of a well-motivated staff. Even with low attrition rates, however, turnover does happen, so it’s important to ask what steps are taken to ensure a smooth transition when personnel changes become necessary. At Nagarro, for example, we create comprehensive training pathways for long term customer engagements, as a provision for smooth on-ramping of new teammates when necessary. This also gives us the ability to quickly scale up the product team during critical product releases, or when we need to shorten the go-to-market time for particular features. Often our clients are so pleased with the Nagarro internal training courses that they use these for their own employee base, as well. Nagarro White Paper 2 How to Evaluate Prospective Partners for Software Product Development 1) NEW TECHNOLOGY RESEARCH AND ADOPTION PRACTICES Choosing a development partner with superb expertise in the product’s existing technology stack and domain is an obvious selection criteria. But in the pursuit of short term product goals, don’t overlook the longer term value of engaging partners with expertise in advanced technologies, as well. Some companies are committed to exploring newer technologies, doing proofs of concept, remaining forward thinking and staying ahead of the curve, while other companies don’t make this a priority. For your product team to develop innovative results, it’s imperative that your development partner possesses strong skills in the advanced technologies arena. Most importantly, you should evaluate different software development vendors for the kinds of systems and processes they have in place to maintain this knowledge “edge” for their engineers. Look at the DNA of the partner. Do they have enough structured support for advanced technology expertise that they are likely to continue developing innovative approaches for your products going forward? One way the prospective partner can ensure ongoing expertise is to have dedicated groups in their workforce for new technologies, specialized architectures, and best practices. Find out if this is the case for your potential partners. Another approach is for the prospective partner to have an internal training organization, specifically dedicated to keeping the employee base on the cutting edge of new developments. Check to see if your potential vendors demonstrate this level of commitment to ongoing expertise within their workforce. Nagarro White Paper 3 How to Evaluate Prospective Partners for Software Product Development 2) RESPONSIVENESS OF YOUR PARTNER The responsiveness you find among vendors can vary enormously, depending on how important your business is to the partner. Sometimes small or medium sized vendors will provide much stronger responsiveness, because the opportunity to work with you means more to them, as opposed to large vendors, for whom the opportunity may be less significant. Look at how readily you are shown meaningful access to the executive management of your prospective partner. Is there deep commitment from the top to stay strategically supportive and engaged in your relationship? Are members of the partner team demonstrating enthusiasm and excitement for your cause? Do you sense a culture of “client advocacy”, with the vendor’s workforce eager to drive your company to further success, or instead is there a sense of punching the clock, to get the job done without exceptional impact? All of these indicators of vendor responsiveness can make a significant difference to the quality of your partnership, and the dynamism of your end product. Further evidence of vendor responsiveness might be seen in the disposition of the vendor’s executive staff as they approach the formative stages of the partnership. Does the vendor’s leadership establish the right conditions for a long-term relationship from the outset? How readily do they invest time with you up front, getting to know you and your business, fully exploring your unique needs? You should see a committed partner not only seek this deeper understanding of your business from the beginning, but also apply it by carefully choosing the “best fit” of talent from the vendor’s workforce. Your partner’s early investment at the executive level should create a winning product team well-suited for your particular needs, establishing a firm foundation for a longer-term relationship. Use Partner Scorecard Below you’ll find a scorecard developed by Nagarro to help you conduct a more methodical comparison of potential partners. You’ll find the factors listed, and the weight assigned to each, reflects our experience and perspective in what makes a valuable partnership work. Nagarro White Paper 4 How to Evaluate Prospective Partners for Software Product Development Outsourced Software Product Development Partner Evaluation Scorecard Criteria Wt.(%) Track Record Current client relationships and engagement capability Product development and maintenance experience Current client list Quality of customer references Domain Expertise Experience with software product development vs IT projects Expertise in the target industry Expertise on hardware / software Expertise using development tools Experience with any third party tools, technologies and platforms, including strategic industry partnerships Expertise in User Experience Design (user research, usability, prototyping, “omni-channel” design) New technology research and adoption practices (keeping the “edge”) Infrastructure Geographical location Offshore and local infrastructure Quality of server, desktop, mobile, network, cloud & backup infrastructure Communication and connectivity infrastructure Power IP Contracts (vendor / client) Contracts (vendor / employee and client / employee) Physical security Network security IP security process and awareness Audits, 3rd party verifications Talent Management strength / stability Overall quality of technical pool Ability to attract mind share, hire and retain talent, quality of recruitment and HR engine Current attrition / attrition management Professionalism, responsiveness and openness Process CMMi and ISO certification / other process & quality certifications Tools used for process implementation Code management / source code control process QA process and test automation experience Documentation standards Knowledge Management process Project Management methodology (maturity of off-shoring engine) Communication transparency Flexibility to adapt process to customer’s needs Deal Pricing Openness / flexibility for structuring a creative deal Experience with BOT (build-operate-transfer) Risks Financial strength / long term viability Conflicts of interest Executive responsiveness & commitment to long-term relationship Cultural fit Score (1-100) Wt. Score (1-100) 15% 4% 4% 4% 3% 15% 3% 2% 2% 2% 2% 2% 2% 10% 1% 3% 2% 3% 1% 10% 2% 1% 1% 2% 2% 2% 15% 3% 3% 4% 3% 2% 15% 1% 2% 2% 2% 2% 2% 2% 1% 1% 10% 5% 2% 3% 10% 4% 2% 2% 2% 100% Nagarro White Paper 5 How to Evaluate Prospective Partners for Software Product Development How to Dig for Deeper Insight Certain factors in the evaluation process are obviously important, but you may not be sure how to assess them amongst your potential partners. Below you’ll find several examples of valuable criteria, along with suggestions for how to explore for them. In evaluating your prospective partners, you’ll benefit from the deeper insight you can gain by using these tactics. 1) DEPTH OF TECHNICAL EXPERTISE AND TALENT The depth of technical expertise within the ranks of your software development partner will have a huge impact on your product success. In fact, this will be critical to the level of innovation your partner can bring to the product. Ideally, you will find a vendor whose expertise is so strong that it can easily model “best practices” to your own employee base, raising the bar to deliver greater innovation than your crew might achieve on their own. Here are a few tactics for uncovering the level of technical depth among prospective partners: a) Check trouble shooting skills by giving a code review exercise to all prospective partners: ask them to analyze the code, identify issues, trouble-shoot and recommend suggestions for improvements, comparing their responses. Once you’re ready to reduce your prospect list to a final few, you could also give a small coding assignment to their teams, and compare the results. b) Interview not only the technical lead and architect from the prospect’s workforce, but potentially, interview 5 or 6 employees from the prospect’s firm, including everyone on the initial team, to ensure they rise to the same standard you require. You need to find the right talent as well as a balanced team. Nagarro White Paper 6 How to Evaluate Prospective Partners for Software Product Development 2) CULTURAL FIT Cultural fit with your own firm is another obvious criterion, but what are some of the best ways to assess for this? a) Meet the management, as well as the key employees who will be working on your team. b) Visit the facilities of the prospective partners you are evaluating. c) If travel is not possible for you due to constraints on your time and budget, you can invite the shortlisted vendor teams to come to your office for evaluation presentations and meetings. d) Check with references for their perspective. e) If this is a long term partnership, it makes sense to conduct a short pilot program first, to see how the two companies work together, before inking the larger deal. This requires more involvement, but can prove exceedingly worthwhile in revealing core problems as well as synergies. This may become even more important if your development involves collaboration with multiple vendors and service providers. 3) QUALITY OF PARTNER’S PROCESS One aspect of the partner’s process orientation involves certifications. There are two key process certifications you should check for: ISO (for security) and CMMi (for process maturity of a company’s software development lifecycle processes). Other certifications might be appropriate, as well. You’ll need to check that your partner’s verbal assurances about certification are verified, since it’s easy to be misled. Confirm with the authorizing organization, and get documentation of the partner’s certification. Second, you should confirm that the partner’s processes will work for you at the right level, especially in a distributed environment. As an example, consider process overhead such as documentation. If there’s too much documentation associated with your partner’s processes, it will raise the cost of the entire operation. But if there’s too little documentation, your project is exposed to risk. If an employee leaves the team, you will need to easily bring a new team member up to speed with knowledge transfer materials. What’s the right level of documentation for your product development process? To check documentation standards, you can ask for a list of all documents your prospective partner typically prepares, and also ask for sample documents for a similar project. Look at the samples to see if the level of detail is what you would expect. Also, the vendor’s processes may look good on paper, but do they support the way your firm operates? Nagarro White Paper 7 How to Evaluate Prospective Partners for Software Product Development Check to see how much flexibility the vendor demonstrates in tailoring its processes to better align with your unique needs. Conclusion Finding the right partner for your software product development comes down to selecting the “best fit” for your needs. If matched well, your partnership should help you create competitive advantage in the marketplace. This white paper identifies several important issues for you to explore as you consider your prospective partnerships, and provides a scorecard to help you systematically compare your options. Ideally, your choice of development partner will not only satisfy your immediate needs, but will set the stage for an ongoing relationship, building your competitive advantage into the future. Nagarro White Paper 8 How to Evaluate Prospective Partners for Software Product Development Nagarro specializes in building complex, business-critical software and IT projects for leading companies across multiple industries. Headquartered in Silicon Valley and a member of the Allgeier Group in Germany, Nagarro is recognized worldwide for its technical expertise, agile deployment, and bedrock commitment to customer service. Central to the company’s character, Nagarro draws on almost two decades of experience providing premiere software product engineering services with highly trained resources around the globe. From initial research and design, to rapid prototyping and roll-out, including legacy modernization as well as new product creation, Nagarro has covered the spectrum of software product development for demanding corporate customers with the most exacting standards. Innovation and strategic excellence remain hallmarks of Nagarro’s involvement. Nagarro has also been named to the Global Outsourcing 100® List by the IAOP® (International Association of Outsourcing Professionals®), earning the highest possible scores in three categories – Customer References, Employee Management and Executive Leadership. Identifying Nagarro among the 25 “Rising Stars”, this ranking reinforces Nagarro’s reputation as a top global provider of business-critical outsourced software development and IT services. For more information, visit us online at http://www.nagarro.com/product-engineering/ Follow us on: [email protected] www.nagarro.com /company/nagarro /nagarro /nagarroinc Local US Offices: San Jose, CA 226 Airport Pkwy Suite 390 San Jose, CA 95110 (408) 436-6170 New York, NY 5 Penn Plaza 23rd Floor New York, NY 10001 (212) 799-2899 Atlanta, GA 400 Galleria Pkwy Suite 1500 Atlanta, GA 30339 (678) 401-3131 Our Locations: Monterrey London Frankfurt Munich Zurich Vienna Timisoara New Delhi Stockholm Jaipur WHITEPAPER MAY 1, 2014 © Copyright 2014. Nagarro In. All rights reserved. No part of this document may be reproduced in any form or by any means, without express written permission from Nagarro Inc. All other trademarks mentioned herein are the property of their respective owners. Specifications subject to change without notice. 226 Airport Parkway, Suite 390 San Jose, CA 95110, USA; Phone: +1 (408) 436 6170 / Fax: +1 (408) 436 7508 Nagarro White Paper 9
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