Almost half of testing and development projects are outsourced, with CIOs predicting around a 14.5% increase in these outsourced projects in two years’ time, research has discovered.
But according to the global research study commissioned by Borland, a Micro Focus company, 31% of outsourced projects have run into service level or time issues and 23% have failed to deliver on the final requirements, threatening 31% of CIO jobs.
Of the 590 CIOs and IT directors polled from nine countries around the globe, 57% described some of their outsourced testing and development projects as unmanageable, an embarrassment, a nightmare or a total failure. The majority of respondents (55%) cited too many changes to the requirements during the project as the main reason for project overruns or failure to deliver on the final requirements.
This is a serious issue given 47% of organisations change the specification of work being done by their outsourced vendor at least once a fortnight or more frequently.
The IT leaders painted a troubling picture about their own ability, as well as that of their outsourcing partners, to accurately define project requirements at the outset and manage change requests during the project.
81% of respondents said they are not totally confident in their ability to clearly document and communicate project requirements to outsourcing vendors at the outset.
85% said they capture and share requirements with a variety of stakeholders, adding complexity which can lead to a higher chance of project issues or failure.
Interestingly, more than a third said outsourcing partners use changes to drive profitability, which could explain vendors’ reluctance to determine requirements from the very start. Almost all CIOs (96%) confirmed unpredicted costs arise due to change requests, but only one in three felt those costs were fair.
Despite outsourcing their test and development needs, a shocking 98% of CIOs confirmed some form of additional in-house work was needed following the final delivery of outsourced projects.
Chris Livesey, Borland VP at Micro Focus, said: "The research highlights that the relatively poor outsourcing results are often caused by a lack of investment in the processes for requirements management and test specification, and this is something we see consistently in the market place today.
"However, the results could be greatly improved by investing in a much clearer statement of requirements and their associated test cases early in the project, enabling both the end client and the service provider to more accurately estimate the project schedule, risks and costs at the beginning of the contract."
He added: "With this early and continual visibility these partnerships would work much more effectively."
