How to Evaluate Prospective Partners for Software Product Development Insight, and Scorecard

How to Evaluate Prospective Partners for Software Product Development
v
How to Evaluate Prospective Partners
for Software Product Development
Insight, and Scorecard
By Sheenam Maheshwari
Nagarro White Paper
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How to Evaluate Prospective Partners for Software Product Development
Introduction
Software product development with outsourced partnerships can make or break your corporate success. Finding the
right partner and establishing careful terms for the shared enterprise will be critical. What’s the best way to evaluate
prospective partners? Which factors are key?
This white paper offers perspective on several important issues, as you compare possible partners for software
product development. In addition to providing deeper insight, this paper also contains a comprehensive scorecard to
help you evaluate the various partners you are considering. Finding the right match between your needs and the
partner’s capabilities can make the difference between success and failure.
Beware of Blind Spots
With nearly two decades of experience as a global provider of business-critical outsourced software development
services, Nagarro has worked with a broad range of product companies, from start-up to later stage enterprises.
We’ve seen a variety of approaches to the selection process for software development partnerships.
While most companies have a basic idea of common criteria to explore with prospective partners, we’ve found that
certain criteria tend to be overlooked in all the “noise” of the selection process. If you’re responsible for choosing the
right partner, you should pay special attention to these important factors noted below. Don’t allow them to become
blind spots in your evaluation, because they will make a big difference to the success of the partnership, and the
quality of the end product.
LOW ATTRITION RATES & STELLAR PEOPLE MANAGEMENT
Seek a prospective partner that excels at motivating and managing its own workforce,
for this should yield a more stable and consistent foundation for your long term
partnership. Top human resource management practices at the partner’s firm will pay
rich dividends to the stability of your product development. Look for low turnover as a
leading indicator of a well-motivated staff.
Even with low attrition rates, however, turnover does happen, so it’s important to ask
what steps are taken to ensure a smooth transition when personnel changes become
necessary. At Nagarro, for example, we create comprehensive training pathways for long term customer
engagements, as a provision for smooth on-ramping of new teammates when necessary. This also gives us the ability
to quickly scale up the product team during critical product releases, or when we need to shorten the go-to-market
time for particular features. Often our clients are so pleased with the Nagarro internal training courses that they use
these for their own employee base, as well.
Nagarro White Paper
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How to Evaluate Prospective Partners for Software Product Development
1) NEW TECHNOLOGY RESEARCH AND ADOPTION PRACTICES
Choosing a development partner with superb expertise in the product’s existing
technology stack and domain is an obvious selection criteria. But in the pursuit of short
term product goals, don’t overlook the longer term value of engaging partners with
expertise in advanced technologies, as well. Some companies are committed to
exploring newer technologies, doing proofs of concept, remaining forward thinking and
staying ahead of the curve, while other companies don’t make this a priority. For your
product team to develop innovative results, it’s imperative that your development
partner possesses strong skills in the advanced technologies arena.
Most importantly, you should evaluate different software development vendors for the kinds of systems and
processes they have in place to maintain this knowledge “edge” for their engineers. Look at the DNA of the partner.
Do they have enough structured support for advanced technology expertise that they are likely to continue
developing innovative approaches for your products going forward?

One way the prospective partner can ensure ongoing expertise is to have dedicated groups in their workforce
for new technologies, specialized architectures, and best practices. Find out if this is the case for your
potential partners.

Another approach is for the prospective partner to have an internal training organization, specifically
dedicated to keeping the employee base on the cutting edge of new developments. Check to see if your
potential vendors demonstrate this level of commitment to ongoing expertise within their workforce.
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How to Evaluate Prospective Partners for Software Product Development
2) RESPONSIVENESS OF YOUR PARTNER
The responsiveness you find among vendors can vary enormously, depending on
how important your business is to the partner. Sometimes small or medium sized
vendors will provide much stronger responsiveness, because the opportunity to
work with you means more to them, as opposed to large vendors, for whom the
opportunity may be less significant.
Look at how readily you are shown meaningful access to the executive
management of your prospective partner. Is there deep commitment from the top
to stay strategically supportive and engaged in your relationship? Are members of the partner team demonstrating
enthusiasm and excitement for your cause? Do you sense a culture of “client advocacy”, with the vendor’s workforce
eager to drive your company to further success, or instead is there a sense of punching the clock, to get the job done
without exceptional impact? All of these indicators of vendor responsiveness can make a significant difference to the
quality of your partnership, and the dynamism of your end product.
Further evidence of vendor responsiveness might be seen in the disposition of the vendor’s executive staff as they
approach the formative stages of the partnership. Does the vendor’s leadership establish the right conditions for a
long-term relationship from the outset? How readily do they invest time with you up front, getting to know you and
your business, fully exploring your unique needs? You should see a committed partner not only seek this deeper
understanding of your business from the beginning, but also apply it by carefully choosing the “best fit” of talent
from the vendor’s workforce. Your partner’s early investment at the executive level should create a winning product
team well-suited for your particular needs, establishing a firm foundation for a longer-term relationship.
Use Partner Scorecard
Below you’ll find a scorecard developed by Nagarro to help you conduct a more methodical comparison of potential
partners. You’ll find the factors listed, and the weight assigned to each, reflects our experience and perspective in
what makes a valuable partnership work.
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How to Evaluate Prospective Partners for Software Product Development
Outsourced Software Product Development Partner Evaluation Scorecard
Criteria
Wt.(%)
Track Record
Current client relationships and engagement capability
Product development and maintenance experience
Current client list
Quality of customer references
Domain
Expertise
Experience with software product development vs IT projects
Expertise in the target industry
Expertise on hardware / software
Expertise using development tools
Experience with any third party tools, technologies and platforms,
including strategic industry partnerships
Expertise in User Experience Design (user research, usability,
prototyping, “omni-channel” design)
New technology research and adoption practices (keeping the “edge”)
Infrastructure
Geographical location
Offshore and local infrastructure
Quality of server, desktop, mobile, network, cloud & backup
infrastructure
Communication and connectivity infrastructure
Power
IP
Contracts (vendor / client)
Contracts (vendor / employee and client / employee)
Physical security
Network security
IP security process and awareness
Audits, 3rd party verifications
Talent
Management strength / stability
Overall quality of technical pool
Ability to attract mind share, hire and retain
talent, quality of recruitment and HR engine
Current attrition / attrition management
Professionalism, responsiveness and openness
Process
CMMi and ISO certification / other process & quality certifications
Tools used for process implementation
Code management / source code control process
QA process and test automation experience
Documentation standards
Knowledge Management process
Project Management methodology (maturity of off-shoring engine)
Communication transparency
Flexibility to adapt process to customer’s needs
Deal
Pricing
Openness / flexibility for structuring a creative deal
Experience with BOT (build-operate-transfer)
Risks
Financial strength / long term viability
Conflicts of interest
Executive responsiveness & commitment to long-term relationship
Cultural fit
Score
(1-100)
Wt. Score
(1-100)
15%
4%
4%
4%
3%
15%
3%
2%
2%
2%
2%
2%
2%
10%
1%
3%
2%
3%
1%
10%
2%
1%
1%
2%
2%
2%
15%
3%
3%
4%
3%
2%
15%
1%
2%
2%
2%
2%
2%
2%
1%
1%
10%
5%
2%
3%
10%
4%
2%
2%
2%
100%
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How to Evaluate Prospective Partners for Software Product Development
How to Dig for Deeper Insight
Certain factors in the evaluation process are obviously important, but you may not be sure how to assess them
amongst your potential partners. Below you’ll find several examples of valuable criteria, along with suggestions for
how to explore for them. In evaluating your prospective partners, you’ll benefit from the deeper insight you can gain
by using these tactics.
1) DEPTH OF TECHNICAL EXPERTISE AND TALENT
The depth of technical expertise within the ranks of your software development
partner will have a huge impact on your product success. In fact, this will be critical to
the level of innovation your partner can bring to the product. Ideally, you will find a
vendor whose expertise is so strong that it can easily model “best practices” to your
own employee base, raising the bar to deliver greater innovation than your crew
might achieve on their own.
Here are a few tactics for uncovering the level of technical depth among prospective
partners:
a) Check trouble shooting skills by giving a code review exercise to all prospective partners: ask them to
analyze the code, identify issues, trouble-shoot and recommend suggestions for improvements,
comparing their responses. Once you’re ready to reduce your prospect list to a final few, you could also
give a small coding assignment to their teams, and compare the results.
b) Interview not only the technical lead and architect from the prospect’s workforce, but potentially,
interview 5 or 6 employees from the prospect’s firm, including everyone on the initial team, to ensure
they rise to the same standard you require. You need to find the right talent as well as a balanced team.
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How to Evaluate Prospective Partners for Software Product Development
2) CULTURAL FIT
Cultural fit with your own firm is another obvious criterion, but what are some of the
best ways to assess for this?
a) Meet the management, as well as the key employees who will be working on
your team.
b) Visit the facilities of the prospective partners you are evaluating.
c) If travel is not possible for you due to constraints on your time and budget,
you can invite the shortlisted vendor teams to come to your office for evaluation presentations and meetings.
d) Check with references for their perspective.
e) If this is a long term partnership, it makes sense to conduct a short pilot program first, to see how the two
companies work together, before inking the larger deal. This requires more involvement, but can prove
exceedingly worthwhile in revealing core problems as well as synergies. This may become even more
important if your development involves collaboration with multiple vendors and service providers.
3) QUALITY OF PARTNER’S PROCESS
One aspect of the partner’s process orientation involves certifications. There are two
key process certifications you should check for: ISO (for security) and CMMi (for
process maturity of a company’s software development lifecycle processes). Other
certifications might be appropriate, as well. You’ll need to check that your partner’s
verbal assurances about certification are verified, since it’s easy to be misled.

Confirm with the authorizing organization, and get documentation of the
partner’s certification. Second, you should confirm that the partner’s
processes will work for you at the right level, especially in a distributed environment. As an example, consider
process overhead such as documentation. If there’s too much documentation associated with your partner’s
processes, it will raise the cost of the entire operation. But if there’s too little documentation, your project is
exposed to risk. If an employee leaves the team, you will need to easily bring a new team member up to
speed with knowledge transfer materials. What’s the right level of documentation for your product
development process?

To check documentation standards, you can ask for a list of all documents your prospective partner typically
prepares, and also ask for sample documents for a similar project. Look at the samples to see if the level of
detail is what you would expect. Also, the vendor’s processes may look good on paper, but do they support
the way your firm operates?
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How to Evaluate Prospective Partners for Software Product Development

Check to see how much flexibility the vendor demonstrates in tailoring its processes to better align with your
unique needs.
Conclusion
Finding the right partner for your software product development comes down to selecting the “best fit” for your
needs. If matched well, your partnership should help you create competitive advantage in the marketplace. This
white paper identifies several important issues for you to explore as you consider your prospective partnerships, and
provides a scorecard to help you systematically compare your options.
Ideally, your choice of development partner will not only satisfy your immediate needs, but will set the stage for an
ongoing relationship, building your competitive advantage into the future.
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How to Evaluate Prospective Partners for Software Product Development
Nagarro specializes in building complex, business-critical software and IT projects for leading companies across
multiple industries. Headquartered in Silicon Valley and a member of the Allgeier Group in Germany, Nagarro is
recognized worldwide for its technical expertise, agile deployment, and bedrock commitment to customer service.
Central to the company’s character, Nagarro draws on almost two decades of experience providing premiere
software product engineering services with highly trained resources around the globe. From initial research and
design, to rapid prototyping and roll-out, including legacy modernization as well as new product creation, Nagarro
has covered the spectrum of software product development for demanding corporate customers with the most
exacting standards. Innovation and strategic excellence remain hallmarks of Nagarro’s involvement. Nagarro has also
been named to the Global Outsourcing 100® List by the IAOP® (International Association of Outsourcing
Professionals®), earning the highest possible scores in three categories – Customer References, Employee
Management and Executive Leadership. Identifying Nagarro among the 25 “Rising Stars”, this ranking reinforces
Nagarro’s reputation as a top global provider of business-critical outsourced software development and IT services.
For more information, visit us online at http://www.nagarro.com/product-engineering/
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WHITEPAPER
MAY 1, 2014
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