Characteristics and determinants of insourced and offshored projects: A comparative analysis

Similar in-house (or insourced) and offshored software development data were paired to find differences (if any) on four project performance criteria: project elapsed times, size, data quality, and same-source nations. For each paired project, the differences between five technical variables (development type, application type, architecture, development platform, and programming language) were considered. The resource dependency theory was used to examine the technical differences between matched projects. Additionally, Hofstede's cultural dimensions were used to analyze the performance of offshored software projects. Data from the International Software Benchmarking Standard Group (ISBSG) was used. The main empirical findings were as follows: project completion time is significantly shorter for in-house development projects; and firms prefer offshoring for new projects, client-service platforms, and newer application languages. Some of Hofstede's cultural dimensions do affect project quality and work effort for offshore projects.

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