The role of knowledge management in offshore outsourced software development

Swartbooi, Andile A. (2010-12)

Thesis (MPhil (Information Science))--University of Stellenbosch, 2010.

Thesis

ENGLISH ABSTRACT: In an effort to streamline operations and focus on what they regard as core activities, a growing number of organizations from both developed and developing countries are increasingly looking to outsource their software development and maintenance activities to lower cost countries such as India and China, this is evidenced by the phenomenal growth in India’s software industry and the number of major overseas IT companies establishing subsidiaries and relocating their Research and Development operations to India’s high-tech cities such as Hyderabad, Chennai and Pune. With the mere size of their populations standing at over a billion people each, supported by their governments, Indian and Chinese business have been able to leverage this population advantage producing a large pool of software engineers, technical specialists and back office workers to cater for the talent demands of the world. While the actual software development process might be non-core to many organizations, it however yields software applications that drive critical business processes and embed valuable organizational knowledge. The handing over of software development operations by an organization to a third party poses a risk of creating a dependency and exposing vital business knowledge to competition thereby compromising its competitive edge. Both the people that participate in software development projects and the software products these people develop possess knowledge which need to be secured and leveraged to enable the continued success of an organization. Securing these knowledge artefacts and the knowledge created by the software development lifecycle process cannot be left to chance, therefore the success of an organization’s software development activities needs to be measured largely on its ability to secure knowledge assets that derive from such process and the leveraging of such knowledge to drive organizational strategy and yield new knowledge. This thesis is premised on the fact that knowledge is the one competitive advantage that separates successful nations from failed states and one dominant force that prevails across all successful economies in the 21st century, hence the notion of a knowledge economy. The study seeks to understand the importance of the role played by knowledge in an outsourced software development engagement and how knowledge management affects the success of this engagement. By exploring the business drivers that spur organizations to outsource their IT activities, the software development lifecycle, the different outsource models available to organizations and the inherent risks surrounding knowledge loss, the thesis seeks to gain an understanding and the criticality of managing knowledge within an outsourced software development context and the strategies that organizations can utilize to deliver on outsourcing promises with minimal risk.

AFRIKAANSE OPSOMMING: Ten einde hulle werksaamhede meer vaartbelyn te maak en om ingestel te bly op dit wat hulle as kernbedrywighede beskou, kyk al hoe meer organisasies in ontwikkelde en ontwikkelende lande na die moontlikheid om die ontwikkeling en instandhouding van hulle sagteware uit te kontrakteer na lande soos Indië en China, waar dit goedkoper gedoen kan word as tuis. Dié feit blyk duidelik uit die fenomenale groei in veral Indië se sagtewarenywerheid en die getal groot oorsese IT firmas wat hulle navorsing en ontwikkeling in hoë-tegnologie stede soos Hyderabad, Chennai en Puna laat doen. Met bevolkings van meer as ’n miljard elk, kon Chinese en Indiese ondernemings hierdie voorsprong benut om ‘n magdom sagteware-ingenieurs, tegniese spesialiste en kantoorwerkers te produseer om in die wêreld se vraag na kundigheid te voorsien. Terwyl die ontwikkeling van sagteware miskien nie deur baie ondernemings as ‘n kernbedrywigheid beskou word nie, lewer dit tog aanwendings op wat kritieke sakeaktiwiteite aandryf en waardevolle organisatoriese kennis vasvang. Die oordra van sagteware-ontwikkeling van een onderneming na ‘n derde party gaan egter gepaard met die risiko dat dit afhanklikheid kan skep en ook uiters belangrike sakekennis aan konkurrente toeganklik maak, wat die mededingende voorsprong wat sulke kennis bied bedreig. Die mense betrokke by die ontwikkeling van sagteware en die produkte wat hulle sodoende skep, is ‘n bron van kennis wat beveilig en verveelvuldig moet word om ‘n onderneming in staat te stel om suksesvol te bly voortbestaan. Die versekering van hierdie verworwe kennis en die kundigheid wat deur die ontwikkelingsiklus van die sagteware geskep word, kan nie aan die toeval oorgelaat word nie – die sukses van ‘n onderneming se sagteware-ontwikkeling moet veral gemeet word aan sy vermoë om die kennisbates wat uit die proses voortvloei te verseker, en om hierdie kennis te verveelvuldig om organisatoriese strategieë aan te dryf en nuwe kennis op te lewer. Hierdie tesis se uitgangspunt is dat kennis die mededingende voorsprong is wat suksesvolle nasies onderskei van die res; dit is dié faktor wat kenmerkend is van al die suksesvolle ekonomieë van die 20ste eeu, en die kern van die begrip van ‘n “kennis-ekonomie”. Hierdie ondersoek wil die belangrikheid verken van die rol wat gespeel word deur kennis in ‘n uitgekontrakteerde verbintenis vir die ontwikkeling van sagteware and hoe kennisbestuur die sukses van so ‘n verbintenis affekteer. Deur ondersoek in te stel na die motivering wat besighede aanspoor om hulle IT bedrywighede uit te plaas, na die sagteware-ontwikkeling lewenssiklus, die verskillende modelle van uitkontraktering wat vir organisasies beskikbaar is en die inherente risiko’s rondom kennisverlies, wil hierdie tesis ‘n begrip vorm van die kritieke noodsaaklikheid vir die bestuur van kennis in ‘n uitgekontrakteerde sagteware-ontwikkeling en van die strategieë wat organisasies kan aanwend om die voordele wat uitkontraktering beloof ten volle te benut teen minimale risiko.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/5352
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