The Dangers of Outsourcing Software Development
Applying Principal Agent Theory to the software consulting industry
Consulting is booming!
Principal Agent Problem
hverdagslig eksempel (bygghere)
Assymetric information
add picture of car salesman
Different interests Diverging incentives
Conflict of interest
A consultant works for two companies
Are we safe?
Title Text
- Bullet One
- Bullet Two
- Bullet Three
Nefarious Patterns
What to look out for
The Infection/Parasite
- Land and expand
- Junior dev zerg rush
- (front loading) selger høyt, leverer kvikksølv
- Bullet Three
The overly attached girl(boy)friend
- Vendor-lock
- Sunk cost, hard to break up
- Creates exclusivity
- Missing documentation
- Sells in-house tools and solutions
- Promotes niche or obscure technology
The leech
- inflate cost
- minimize effort required
- CV Driven Development
The Emperor has clothes
- Yes men
- No hard questions
- Patchwork and band aids
- Titanic 1st class passenger
The thief in the night
- absorb business and domain knowledge
- recruit the best staff
- soild back on premium
Mitigation
Strategies to protect your project
Gap
- Information
- Incentive
Information Gap
Incentive Gap
The overly attached girlfriend
- Standard tools
- Well-known technologies
- Proper documentation
- multiple contractors
Radical ideas
- self reporting
- voluntary public feedback
- Proper documentation
- multiple contractors
Strenghten loyalty
- Encourage mutual trust
- Assume good intentions
- Avoid micromanagement