Barriers in the selection of offshore software development outsourcing vendors: An exploratory study using a systematic literature review

Abstract

Context Software development outsourcing is a contract-based relationship between client and vendor organisations in which a client contracts out all or part of its software development activities to a vendor, who provides agreed services for remuneration. Objective The objective is to identify various barriers that have a negative impact on software outsourcing clients in the selection process of offshore software development outsourcing vendors. Method We have performed a systematic literature review (SLR) process for the identification of barriers. We have performed all the SLR steps such as the protocol development, initial selection, final selection, quality assessment, data extraction and data synthesis. Results We have identified barriers such as ‘language and cultural barriers’, ‘country instability’, ‘lack of project management’, ‘lack of protection for intellectual property rights’ and ‘lack of technical capability’ that generally have a negative impact on outsourcing clients. We have identified only one common frequently cited barrier in three types of organisations (i.e. small, medium and large) which is ‘language and cultural barriers’. We did not identify any common frequently cited barrier in three continents (Asia, North America and Europe) and in two decades (1990–1999 and 2000–mid 2008). The results also reveal the similarities and differences in the barriers identified through different study strategies. Conclusions Vendors should address frequently cited barriers such as ‘language and cultural barriers’, ‘country instability’, ‘lack of project management’, ‘lack of protection for intellectual property rights’ and ‘lack of technical capability’ in order to compete in the offshore outsourcing business.