An Exploratory Study on Strategic Software Development Outsourcing

Abstract: Business organizations are realizing that Software Development Outsourcing (SDO) is now an imperative and strategic step for their system operation success and that SDO really means best practice. Many industrial organizations have or are in the process of implementing such business transformation. This research is to obtain information on strategic SDO in software industry, which is an essential procedure for organizations to guide their SDO decisions and actions. The research strategy used in this paper is as follows: Explanatory theories and mixed methodology were applied to a survey method and five case studies in the software industry. Simultaneously, evidence from a systematic literature review is provided concerning modern strategic SDO, impact on organization’s performance, and ways to manage strategic SDO. The research unveils how industrial software organizations capitalize SDO as a strategic tool in their product development.