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QUESTION & ANSWER

Low Price Software Outsourcing Risks

Low prices may arise from the reuse of templates, missing scopes, understaffing or later reliance on change fees, which does not necessarily represent greater efficiency. The price of comparing offers is to harmonize demand, interface, data, testing, deployment, source code and maintenance calibre. Especially low prices require explanations of team roles, workload and exclusion.

Answer the question.

First, give conclusions that can be used for decision-making

The difference in the vendor's offer may be reasonable, such as the existence of mature components, high automation or different team cost structures; but if the price does not cover demand analysis, design, testing and on-line responsibility, it may be balanced by reducing quality, using unauthorized source codes, frequent changes, late delivery or abandonment of the project.

DECISION FACTORS

What conditions need to be identified before judgement is made?

The same question may have different answers under different business, data and project phases. It is suggested that the following conditions be checked and that the common findings on the web be incorporated into their own projects.

Whether the individual offers were based on the same scope and acceptance criteriaInclude backstage, interface, data migration, testing and deploymentWhether source code, third-party licensing, cloud resources and maintenance costs are separateWhether the number of teams, the input cycle and the offer are logically matched
ACTION STEPS

Suggested order of advance

01

First, we'll be clear about the target and the border.

A summary of the same project and a list of issues were sent to all vendors.

02

Validation Key Dependence

Explanations were requested on workload, technical route, reuse content and key assumptions.

03

Development of assessable outcomes

Validation of real delivery quality through mini-diagnosis or milestones.

04

Make sure you decide the next step with the real results.

Three years of maintenance, change and takeover costs are measured before decision is taken.

PRACTICAL EXAMPLE

How do you understand it in the actual business?

Example used to illustrate the method of judgement

A management system low-cost scheme contains only a front-end template and shared backstage, does not export complete data or deliver service-end source code. An enterprise is restricted to each subsequent adjustment by the platform if it looks at the first price.

COMMON RISKS

The easiest pit to step on.

It is considered that the functional name is the same, so the responsibility for delivery is the same.

Accepts a large “follow-up” range, but still signs fixed totals

No staged results before payment, no exit opportunities for low-priced projects

ACCEPTANCE

How should we end up receiving and confirming?

The low price is not a problem in itself, and it is not possible to explain how the price corresponds to the results of the work and the long-term liability that is the risk signal.

When preparing to communicate with suppliers or internal teams, it is recommended that current processes, representative samples, existing systems, planning time and budget levels be brought. First, the unknown items are clearly marked, and then the decision is made to use diagnostics, PoC, fixed-range projects or ongoing research and development, which is usually more reliable than a direct demand for a price and duration without borders.

Your project conditions are different from the examples above?

Operational objectives, existing systems, sample and planned time could be collated before consultants could make preliminary judgements in relation to actual boundaries.

Associate project consultants