Blending Agile Scrum & Offshore Outsourcing Software Development

In today’s highly competitive environment, it becomes increasingly common for many companies to face internal and external pressure for delivering their products and services with the lowest cost and/or fastest time possible. Information Technology Outsourcing (ITO) has helped to release part of such pressure by enabling companies to gain cost advantage and obtain access to qualified labor pools (Manning, Massini, & Lewin, 2008). Not too far from this topic is Agile Software Methodologies, which came into place by promoting continuous releases and close customer participation along the software development process. Agile Scrum has been defined as the most mature and widely adopted method from all the Agile methodologies (Hossain, Babar, & Paik, 2009). Further investigations suggest that Agile Scrum, in collocated development, can increase productivity up to 5-10 times higher than the industry average and empirical evidence proposes that non-collocated teams can reach the same performance (Sutherland, Schoonheim, & Rijk, 2008). Blending Offshoring Outsourcing projects with Agile Scrum, seem to be the perfect combination for many companies. However, companies continue facing difficulties in reaching such promised results and the mechanisms behind the ability of Agile Offshoring Outsourcing to shorten time-to-market remain hazy. Investigations explaining why certain projects cannot reach such promising results are scarce. This problem context led us to the main research question: What criteria hinder the reduction of time-to-market in software development projects that combine Agile Scrum with Offshoring Outsourcing? To answer it, we first researched what is Agile Scrum and how software development takes place under this methodology. Our research revealed that Agile Scrum is conformed by three main actors: ScrumMaster, Product Owner, Development Team. Additionally, literature suggests that Scrum demands high levels of interaction, openness and flexibility among all its participants. The second step in our research was to understand on how Offshore Outsource project are executed through their most common problems. Literatures addressed us into five main topics: 1) Culture Differences – subdivided into National Culture and Organizational Culture, 2) Coordination, 3) Trust, 4) Time Zone Differences and 5) Effective Communication. Based on these theoretical concepts we built a Conceptual Model containing twelve propositions describing what criteria influence the reduction of time-to-market. Each proposition is associated to Scrum concepts and how they could stimulate or hinder the reduction of time-to-market based on the context where the project takes place. Following, we conducted a multiple case study considering a Belgium telecommunication company (the Client) and an Indian outsourcing service provider (the Vendor). The unit of analysis: projects blending Outsourcing Offshoring and Agile Scrum. The Case Study analyzed two projects: 1) Red Project. The project suffered major delays on the original schedule, thus the Vendor decided to introduce Agile Scrum to reduce such project gap. The project delivered part of its functionality and later it was halted. It is considered a major failure in their Client-Vendor relationship. 2) Blue Project. Second project in timeline. Agile Scrum practices were also introduced after the project was already started through a Vendor initiative. The project experiences neither major delays nor exceptional performance, however Client-Vendor frictions were found in the meantime. The refined Conceptual Model is described in Figure 6 7, page 78. Our findings can be summarized as: 1)The Identification of criteria influencing the reduction of time-to-market: Literature deductions supported by empirical evidence suggest the existence of at six criteria influencing the reduction of time-to-market. Such criteria is expressed in six prepositions the mentioned Conceptual Model (P1,P3,P5,P7,P9,11). 2) Implicit evolution of the Agile Scrum methodology. No scientific evidence was found tracking the implicit simplification of Scrum as a methodology, confirming the gap between practitioners and scientists with regards Agile practices. Additionally, based on the theoretical findings and empirical experience from the Case Study, we derived a set of recommendations to Clients and Vendors aiming to reduce time-to-market while conducting this type of projects. For further research, we recommend the following topics: 1) Complement the current research quantitative research techniques and also conduct case studies in other industries besides telecommunication 2) Investigate the most suitable contract agreements in Agile Scrum Offshore Outsource Projects. 3) The execution of Agile Scrum Offshore Outsource Projects involving multiple organizations and 4) Research on why Agile Scrum certifications are largely concentrated in western countries.