Explaining Variations in Client Extra Costs between Software Projects Offshored to India

Gaining economic benefits from substantially lower labor costs has been reported as a major reason for offshoring labor-intensive information systems services to low-wage countries. However, if wage differences are so high, why is there such a high level of variation in the economic success between offshored IS projects? This study argues that offshore outsourcing involves a number of extra costs for the ^his paper was recommended for acceptance by Associate Guest Editor Erran Carmel. client organization that account for the economic failure of offshore projects. The objective is to disaggregate these extra costs into their constituent parts and to explain why they differ between offshored software projects. The focus is on software development and maintenance projects that are offshored to Indian vendors. A theoretical framework is developed a priori based on transaction cost economics (TCE) and the knowledge-based view of the firm, comple mented by factors that acknowledge the specific offshore context The framework is empirically explored using a multiple case study design including six offshored software projects in a large German financial service institution. The results of our analysis indicate that the client incurs post contractual extra costs for four types of activities: (1) re quirements specification and design, (2) knowledge transfer, (3) control, and (4) coordination. In projects that require a high level of client-specific knowledge about idiosyncratic business processes and software systems, these extra costs were found to be substantially higher than in projects where more general knowledge was needed. Notably, these costs most often arose independently from the threat of oppor tunistic behavior, challenging the predominant TCE logic of market failure. Rather, the client extra costs were parti cularly high in client-specific projects because the effort for managing the consequences of the knowledge asymmetries between client and vendor was particularly high in these projects. Prior experiences of the vendor with related client projects were found to reduce the level of extra costs but could not fully offset the increase in extra costs in highly client-specific projects. Moreover, cultural and geographic distance between client and vendor as well as personnel turnover were found to increase client extra costs. Slight evidence was found, however, that the cost-increasing impact of these factors was also leveraged in projects with a high level of required client-specific knowledge (moderator effect).

Der Einfluss kultureller Unterschiede beim IT-Offshoring

Dieser Beitrag zeigt auf der Basis von sechs Anwendungsentwicklung-sprojekten in Indien, welche kulturellen Einflussgrößen bei der Auslagerung von IT-Projekten einzubeziehen sind, wie diese Determinanten den Projekterfolg beeinflussen und durch welche Maßnahmen von Seiten des Managements kulturelle Herausforderungen zur Sicherung des Projekterfolgs gemeistert werden können: - Als kritische Kulturfaktoren haben sich Unterschiede in der Macht-distanz, dem Designverständnis und der aktiven versus passiven Arbeitseinstellung herauskristallisiert. - Diese Faktoren wirken direkt auf wichtige Stellgrößen der Beziehungs-qualität, wie dem Vertrauen, der Leistung des Anbieters, dem Grad der Kooperation und auftretenden Konflikten. Auf diese Weise wirken sie indirekt auf den Erfolg von Offshoring-Projekten. - Eine klare Definition von Rollen und Mechanismen, starke Mitarbeiterführung und ein aktives Kulturmanagement, das eine An- passung an die Kultur des Kunden oder an die des Anbieters beinhaltet, haben sich als effektive Managementmaßnahmen zur Bewältigung kultureller Herausforderungen herausgestellt

Herausforderungen und Chancen der Internationalisierung für mittelständische Softwareunternehmen in Deutschland

Die Internationalisierung ist für Softwareunternehmen im deutschen Mittelstand einerseits ein Muss, um den Anforderungen international ausgerichte-ter Kunden gerecht zu werden, anderseits eröffnet sie der Softwarebranche die Chance, aktiv neue Märkte zu erschließen. Anhand ausgewählter Beispiele deutscher Softwareunternehmen, die bereits international tätig sind, werden in die-ser Studie auf Basis von Experteninterviews Treiber, Strategien und Umsetzungs-ansätze der Internationalisierung vor dem Hintergrund der jeweiligen Eigenschaf-ten der Softwareprodukte dargestellt. Die Ergebnisse zeigen erste Zusammenhänge auf und bieten wichtige Ansatzpunkte für weitere Forschung im Bereich der Internationalisierung von Softwareunternehmen.

The Emergence of Partnership Networks in the Enterprise Application Development Industry - A Global Corporation Perspective

Currently, dramatic changes are happening in the IS development industry. The incumbent system developers (hubs) are embracing partnerships with less well established companies (spokes), acting in specific niches. This paper seeks to establish a better understanding of the motives for this strategy. Relying on existing work on strategic alliance formation, it is argued that partnering is particularly attractive, if these small companies possess certain capabilities that are difficult to obtain through other arrangements than partnering. Again drawing on the literature, three categories of capabilities are identified: the capability to innovate within their niche, the capability to provide a specific functionality that can be integrated with the incumbents’ systems, and the capability to address novel markets. These factors are analyzed through a case study. The case represents a market leader in the global IS development industry, which fosters a network of smaller partner firms. The study reveals that temporal dynamics between the identified factors are playing a dominant role in these networks. A cyclical partnership model is developed that attempts to explain the life cycle of a partnership within such a network.

Towards an SMS-based Social Network for Health Workers in Rural Areas in Myanmar

Seventy percent of the population in Myanmar lives in rural areas. Although health workers are adequately trained, they are overburdened due to understaffing and insufficient supplies. Literature confirms that information and communication technologies can extend the reach of healthcare. In this paper, we present an SMS-based social network that aims to help health workers to interact with other medical professionals through topic-based message delivery. Topics describe interests of users and the content of message. A message is delivered by matching message content with user interests. Users describe topics as ICD- 10 codes, a comprehensive medical taxonomy. In this ICD-10 coded SMS, a set of prearranged codes provides a common language for users to send structured information that fits inside an SMS.

Optimizing Triage and Hospitalization in Adult General Medical Emergency Patients. The Triage Project

Background: Patients presenting to the emergency department (ED) currently face inacceptable delays in initial treatment, and long, costly hospital stays due to suboptimal initial triage and site-of-care decisions. Accurate ED triage should focus not only on initial treatment priority, but also on prediction of medical risk and nursing needs to improve site-of-care decisions and to simplify early discharge management. Different triage scores have been proposed, such as the Manchester triage system (MTS). Yet, these scores focus only on treatment priority, have suboptimal performance and lack validation in the Swiss health care system. Because the MTS will be introduced into clinical routine at the Kantonsspital Aarau, we propose a large prospective cohort study to optimize initial patient triage. Specifically, the aim of this trial is to derive a three-part triage algorithm to better predict (a) treatment priority; (b) medical risk and thus need for in-hospital treatment; (c) post-acute care needs of patients at the most proximal time point of ED admission. Methods/design: Prospective, observational, multicenter, multi-national cohort study. We will include all consecutive medical patients seeking ED care into this observational registry. There will be no exclusions except for non-adult and non-medical patients. Vital signs will be recorded and left over blood samples will be stored for later batch analysis of blood markers. Upon ED admission, the post-acute care discharge score (PACD) will be recorded. Attending ED physicians will adjudicate triage priority based on all available results at the time of ED discharge to the medical ward. Patients will be reassessed daily during the hospital course for medical stability and readiness for discharge from the nurses and if involved social workers perspective. To assess outcomes, data from electronic medical records will be used and all patients will be contacted 30 days after hospital admission to assess vital and functional status, re-hospitalization, satisfaction with care and quality of life measures. We aim to include between 5000 and 7000 patients over one year of recruitment to derive the three-part triage algorithm. The respective main endpoints were defined as (a) initial triage priority (high vs. low priority) adjudicated by the attending ED physician at ED discharge, (b) adverse 30 day outcome (death or intensive care unit admission) within 30 days following ED admission to assess patients risk and thus need for in-hospital treatment and (c) post acute care needs after hospital discharge, defined as transfer of patients to a post-acute care institution, for early recognition and planning of post-acute care needs. Other outcomes are time to first physician contact, time to initiation of adequate medical therapy, time to social worker involvement, length of hospital stay, reasons fordischarge delays, patient’s satisfaction with care, overall hospital costs and patients care needs after returning home. Discussion: Using a reliable initial triage system for estimating initial treatment priority, need for in-hospital treatment and post-acute care needs is an innovative and persuasive approach for a more targeted and efficient management of medical patients in the ED. The proposed interdisciplinary , multi-national project has unprecedented potential to improve initial triage decisions and optimize resource allocation to the sickest patients from admission to discharge. The algorithms derived in this study will be compared in a later randomized controlled trial against a usual care control group in terms of resource use, length of hospital stay, overall costs and patient’s outcomes in terms of mortality, re-hospitalization, quality of life and satisfaction with care.

Towards End-User Driven Power Saving Control in Android devices

Abstract. During the last decade mobile communications increasingly became part of people's daily routine. Such usage raises new challenges regarding devices' battery lifetime management when using most popular wireless access technologies, such as IEEE 802.11. This paper investigates the energy/delay trade-off of using an end-user driven power saving approach, when compared with the standard IEEE 802.11 power saving algorithms. The assessment was conducted in a real testbed using an Android mobile phone and high-precision energy measurement hardware. The results show clear energy benefits of employing user-driven power saving techniques, when compared with other standard approaches.

Testbed Evaluation of Sensor Node Overlay Multicast

The Sensor Node Overlay Multicast (SNOMC) protocol supports reliable, time-efficient and energy-efficient dissemination of data from one sender node to multiple receivers as it is needed for configuration, code update, and management operations in wireless sensor networks. SNOMC supports end-to-end reliability using negative acknowledgements. The mechanism is simple and easy to implement and can significantly reduce the number of transmissions. SNOMC supports three different caching strategies namely caching on each intermediate node, caching on branching nodes, or caching on the sender node only. SNOMC was evaluated in our in-house real-world testbed and compared to a number of common data dissemination protocols. It outperforms the selected protocols in terms of transmission time, number of transmitted packets, and energy-consumption.

SLA-Driven Simulation of Multi-Tenant Scalable Cloud-Distributed Enterprise Information Systems

Cloud Computing is an enabler for delivering large-scale, distributed enterprise applications with strict requirements in terms of performance. It is often the case that such applications have complex scaling and Service Level Agreement (SLA) management requirements. In this paper we present a simulation approach for validating and comparing SLA-aware scaling policies using the CloudSim simulator, using data from an actual Distributed Enterprise Information System (dEIS). We extend CloudSim with concurrent and multi-tenant task simulation capabilities. We then show how different scaling policies can be used for simulating multiple dEIS applications. We present multiple experiments depicting the impact of VM scaling on both datacenter energy consumption and dEIS performance indicators.

Success in Offshoring of Application Development – Does Culture Matter?

Recently, offshoring of information systems (IS) services to external vendors has seen considerable growth. Outsourcing to vendors in foreign countries brings about unique challenges which need to be understood and managed effectively. This paper explores cultural differences in IS offshoring arrangements involving German client organizations that outsource application development activities to Indian vendors. For this purpose, a research framework is developed based on both theoretical considerations and specific empirical observations from multiple case studies. The goal is to (1) explore the nature of cultural differences in offshoring arrangements in depth and to (2) analyze the relationship between those cultural differences and offshoring success. Based on the case findings, implications and practices for the management of offshore development projects are outlined.