Ms. Sheryl Caguimbaga posted on Service Quality Evaluation Method for Community-based Software Outsourcing Process by Huimin Jiang, Alice Liu, Zhongjie Wang and Shu Liu from the School of Computer Science and Technology, Harbin Institute of Technology.

With the rapid socio-economic development, service becomes more and more popular. At the same time, service quality is increasingly attracting wide attentions. The reason why service quality becomes so important is that the higher value of service quality can lead to higher customer satisfaction, and ultimately result in higher revenue growth and profitability. More and more enterprises are looking to outsource their software development to other companies, respond to the pressures such as development costs, human resources access, new market development, or building business competencies. Recently, to outsource software development to the community developers through web has been recognized by more and more people. This outsourcing approach is termed as community-based software model in this paper. According to the paper, outsourcing software development to the community developers is a promising model to help reduce software development cost and improve software quality. The paper presented a method to evaluate the quality of service in the managing community-based software outsourcing process. There are three types of objects whose service quality need to be evaluated, i.e. service behaviors, service products, and service providers. For each type of object, there are five dimensions of quality indicators, i.e. time and efficiency, price and cost, quality of service content, resources and conditions, reputation and risk. Based on these dimensions, the researchers built a set of quality indicators and the corresponding measurement methods. The researchers adopted the traditional AHP method to calculate the total quality of each type of object. Call-For-Implementation is community-based software development method put forward by IBM china research lab. In the paper, Call-For-Implementation was taken as an example to introduce how to apply the proposed service evaluation method. A prototype is developed to support the evaluation process and exhibit results of quality evaluation. The main contribution of this paper is that an objective and dynamic service quality computation method is proposed to help evaluate the quality of outsourcing software management service.

Back to the paper posted by Ms. Sheryl, the content is informative although there were some abbreviations that were not explained well. Although the papers topic is about outsourcing, the term itself was also not properly emphasized same as what Ms. Sheryl noticed. As I read through the paper, I think the paper was more concerned on the Service Quality Evaluation Method. The researchers presented the findings in an orderly manner making the paper interesting to read. Since the term outsourcing was not emphasized in the paper, I made some readings about it.

According to wiseGEEK.com, Outsourcing refers to a company that contracts with another company to provide services that might otherwise be performed by in-house employees. There are many reasons that companies outsource various jobs, but the most prominent advantage seems to be the fact that it often saves money. Many of the companies that provide outsourcing services are able to do the work for considerably less money, as they don't have to provide benefits to their workers and have fewer overhead expenses to worry about.

Outsourcing also allows companies to focus on other business issues while having the details taken care of by outside experts. This means that a large amount of resources and attention, which might fall on the shoulders of management professionals, can be used for more important, broader issues within the company. The specialized company that handles the outsourced work is often streamlined, and often has world-class capabilities and access to new technology that a company couldn't afford to buy on their own. Plus, if a company is looking to expand, outsourcing is a cost-effective way to start building foundations in other countries.

There are some disadvantages to outsourcing as well. One of these is that outsourcing often eliminates direct communication between a company and its clients. This prevents a company from building solid relationships with their customers, and often leads to dissatisfaction on one or both sides. There is also the danger of not being able to control some aspects of the company, as outsourcing may lead to delayed communications and project implementation. Any sensitive information is more vulnerable, and a company may become very dependent upon its outsource providers, which could lead to problems should the outsource provider back out on their contract suddenly.

Lever (1997) described four phases of outsourcing: discovery; negotiation; transition; and assessment. Zhu et al. (2001) also described four stages within the outsourcing process: planning; developing; implementing; and surviving. These process models are useful as a basis for understanding the steps involved in outsourcing. Discovery consists of benchmarking internal service levels, identifying future requirements, issuing requests for proposals and identifying a shortlist of suppliers. Planning is creating a sound business plan that includes all the present and future costs of outsourcing the activity as well as identifying hidden costs, such as impact on the community, customer services and employees. Negotiation entails selecting the supplier based on the compatibility of the supplier’s operating philosophy, approach to service and approach to joint planning. Development has a different focus. Negotiation is focused on creating a partnership; development, however, involves determining the appropriate vendor agreement with the appropriate level of detail, establishing the appropriate business relationship to be entered into by the buying and supplying companies, an assessment of the impact on and management of employee benefits, developing a timeline for outsourcing to happen and preparing a communications plan. This involves focusing not only on the relationship, but also on the internal issues that have to be addressed. In the transition stage, the company is planning and preparing staff and computer systems for transferral to the supplier. Similarly, implementation involves creating a transition plan and checklist. At the assessment stage, the supplier is providing the activity and the performance is monitored using service levels and benchmarks. At the end of this phase, the contract is either terminated or renegotiated. The survival stage involves a post-outsourcing review to determine if the objectives before the outsourcing were met by the outsourcing.

Distinct forces shaped each of the outsourcing processes: environmental forces, organizational forces, as well as individual and group forces. These forces influenced the activities to be outsourced and the motivations to outsource.

Within each of the cases environmental factors, factors external to the organization, were regarded as an influence on the outsourcing process, especially on the decision to outsource. These were the intensity of the competitive environment, the political and regulatory environment, changes or issues surrounding technology, and influences from the social environment. From an organizational perspective, history, strategy, cost, resources, critical incidents and competitive positioning all appeared to shape the outsourcing process. At an individual and group level, several factors appeared to influence the outsourcing processes: political behavior; altruism; power; and incomplete information.