Tactical Approaches for Alleviating Distance in Global Software Development

The phenomenon of global software development Only a decade ago, the number of entities engaging in global software development was small—but this has rapidly changed. Today, 203 of the US Fortune 500 engage in offshore outsourcing.1 In a recent study, we found that within the largest US firms, the median ratio of IT work outsourced—but consumed largely in the US— is 6.5 percent.2 Meanwhile, in the much smaller Netherlands, about 250 Dutch companies of various sizes engage in some kind of offshore work.3 Upwards of 50 nations are currently participating—at least minimally—in collaborative software development internationally. In India, there are now 800 IT service firms competing for work globally.3 Many American firms are in the process of a radical push to send their key software processes offshore, and critical centers of software R&D are growing outside the traditional centers (such as the US)—in Ireland, Israel, Singapore, Finland, and many other nations. Finally, the marketplace is responding to the increased demand for IT labor through the construction of new commercial mechanisms. IT business-to-business intermediaries, such as ITsquare.com and IT-radar.com, serve as exchanges between worldwide IT services vendors and smalland medium-size businesses with IT needs. There are two critical, strategic reasons for moving to offshore software developfocus