Managing Outsourced Software Projects: An Analysis of Project Performance and Customer Satisfaction

29 Pages Posted: 21 Feb 2010

See all articles by Sriram Narayanan

Sriram Narayanan

Michigan State University

Sridhar Balasubramanian

University of North Carolina Kenan-Flagler Business School

Jayashankar M. Swaminathan

University of North Carolina (UNC) at Chapel Hill - Operations Area

Date Written: January 17, 2010

Abstract

We examine the drivers of project performance and customer satisfaction in outsourced software projects using a proprietary panel dataset. The data cover 822 customer observations related to 182 unique projects executed by an India-based software services vendor. Adopting a multidisciplinary perspective, we investigate how project planning, team stability, and communication effectiveness (antecedent variables) impact project performance and customer satisfaction. We delineate the direct and interactive influences of the antecedent variables. We also examine how these influences are moderated by two important project contexts: (a) the nature of software work (Maintenance & Development versus Testing projects) and (b) project maturity (New versus Mature projects). Among other results, we demonstrate that when project planning capabilities are high, the positive impact of team stability and communication effectiveness on project performance is even higher. In addition, our results suggest that the impact of communication on project performance is muted when team stability is high. Finally, we also demonstrate that the impact of the antecedent variables on project performance varies with the nature of software work. Our findings offer specific and actionable insights to managers that can help them manage outsourced projects better, and open up new research perspectives in the context of outsourced project management.

Keywords: Outsourcing, Software Projects, Project planning, Customer Satisfaction, Operations Management

Suggested Citation

Narayanan, Sriram and Balasubramanian, Sridhar and Swaminathan, Jayashankar M., Managing Outsourced Software Projects: An Analysis of Project Performance and Customer Satisfaction (January 17, 2010). Available at SSRN: https://ssrn.com/abstract=1548244 or http://dx.doi.org/10.2139/ssrn.1548244

Sriram Narayanan (Contact Author)

Michigan State University ( email )

East Lansing, MI
United States

Sridhar Balasubramanian

University of North Carolina Kenan-Flagler Business School ( email )

Chapel Hill, NC 27599
United States
919-962-3194 (Phone)
919-962-7186 (Fax)

Jayashankar M. Swaminathan

University of North Carolina (UNC) at Chapel Hill - Operations Area ( email )

300 Kenan Center Drive
Chapel Hill, NC 27599
United States

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