Five years ago, that kind of outsourcing was already at the limit, it was noting new, and all indications were so that it will change. It had to change, but this just didn’t happen…

Who would want to restructure and change the business which earned so much money by applying so little effort? The cost of entry into the market was minimal, the cost of average quality resources – very low, customers stood in line. When crisis hit, that army of semi-professionals rushed to the market, ready to work for food, but not being able to unite and act as a powerful force, covering only the very bottom of the outsourcing market, that service could not be of any serious threat.

Now, when the business once again gained access to money, it would seem everything should be back as before, but attitudes have changed.

Here are three main points that catch the eye:

1. Investors are not ready to invest in expensive business ideas without a clear monetization roadmap, and what’s particularly new , they want to participate in selecting a vendor to be confident, not only in idea, but in its implementation.
2. Market actively explores and uses ready-made solutions. People are no longer willing to pay for infrastructure, either you have picked a set of open-source ready-made solutions and gained expertise in their customization, or you have built once of your own, or you risk to be out of business.
3. Experience in development or customization of ready-made solutions in vertical industries. Previously, who would actually check whether you are a CRM guru, document management or travelling business automation? Times have changed and it’s not enough just to put references from satisfied customers on the table.

Let’s consider these three points in more detail.

1. It is clear with the monetization, people become less willing to invest in bright heads, hoping to attract the enterpreneur and get their profit on the second or third project. People who are willing to get into this business should think about multiplying each dollar invested. New trend here is that investors, successful business people, believe that their business experience, plus the enterpreneurs motivation will result, all together, in a more predictable and high quality result. It covers all areas from design to marketing the product, all channels of promotion, logistics, etc.
2. With the rapid technology development and a qualitative leap every two years, it was easy to convince the customer that the ready-made solutions are not the panacea that the rapid development of technology market will make outdated in a year, only fresh thoughts and ideas are good for their business. But let’s face it, properly designed applications can remain at the peak for a very long time, simply by substituting low-level processes and technologies with more modern, without modifying or rewriting the business logic of applications. Are there new improved methods of working with databases? New ways of dealing with Rich User Interface? Rewrite database and presentation layers, and live on. And when it comes to this, the question arises whether or not the developer with whom you have worked a year ago will be willing to understand their old approaches to revitalize your product and make it up to date, and all that for a modest fee? He has gone far ahead, he is ready to offer you a completely new, advanced solution (all that you have already heard a year ago, right?). Picking right solutions (whether open source or commercial), customized properly (maintaining backward compatibility and upgrades) is the key to solving this problem.
3. Marketing does wonderful things. Especially online marketing where no one can make a person responsible for what’s written. Enterprise management software? Here you are! We just take that CRM, bolt this document management here, online planning tool, duplicate remover for outlook and where was that accounting and warehousing? Here you go. All on different platforms? So what … Having experience with each of these solutions may not even represent what you could face by tying to stick them all together, both in technological sense and in terms of processes / business. Vendors who are able to show a commercial solution, or a set of compatible open-source tools that solves specific problems of the customer will be more and more preferred over those who just talk.

Selection as before remains with those who are holding the money. Just now it is a more balanced, more reasonable choice, it is result-oriented rather than process-oriented. Outsourcing is increasingly becoming a working tool, with its pros and cons. The fewer conditions taken into consideration when choosing a vendor, the more it resembles a professional tool, not an amateur, suitable for a narrow range and able to cripple, if not properly used.

Next week will continue to develop the idea of working with ready-made solutions and talk about different approaches of using open source and commercial products for the custom works.