The purpose of this project was to assess the relative effectiveness and efficiency of the use of in house programmers versus the use of outside consulting for the development of data management and processing software for the XYZ Company from the perspective of users and developers within the company. An ancillary purpose of the project was the development of a set of criteria that could be applied by the company to similar evaluations related to software development in the future.
The use of outside consultants as opposed to in house programmers for software development falls into the general area of outsourcing. Outsourcing is a term applied to a variety of practices that, in essence, mean that functions that would otherwise be performed by a firm's own employees are performed by entities external to the firm (Quinn, 1991, p. 7). Outsourcing, as a concept, is related to and, in the broadest scope of the term, encompasses both the make or buy decision concept and the concept of contracting out services. Outsourcing in information management, as an example, encompasses the make or buy decision concept when a decision is made by a firm to either acquire a software program on the market or employ outside consultants to develop such software, as opposed to the in house designing of a software program specifically tailored to the firm's need. Alternatively, outsourcing in information management encompasses the concept of contracting out services when a decision is made to have some aspect of the information management function, payroll preparation as an example, performed by an independent data processing service, as opposed to the in house preparation of payrolls. This project assessed the feasibility of outsourcing as a strategy for the XYZ Company with respect to the development of software.
The XYZ Company has specialized needs for data management and processing software that cannot easily be met through the acquisition of...