Factors influencing clients in the selection of offshore software outsourcing vendors: An exploratory study using a systematic literature review

Context: Offshore software development outsourcing is a modern business strategy for developing high quality software at low cost. Objective: The objective of this research paper is to identify and analyse factors that are important in terms of the competitiveness of vendor organisations in attracting outsourcing projects. Method: We performed a systematic literature review (SLR) by applying our customised search strings which were derived from our research questions. We 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 factors such as cost-saving, skilled human resource, appropriate infrastructure, quality of product and services, efficient outsourcing relationships management, and an organisation's track record of successful projects which are generally considered important by the outsourcing clients. Our results indicate that appropriate infrastructure, cost-saving, and skilled human resource are common in three continents, namely Asia, North America and Europe. We identified appropriate infrastructure, cost-saving, and quality of products and services as being common in three types of organisations (small, medium and large). We have also identified four factors-appropriate infrastructure, cost-saving, quality of products and services, and skilled human resource as being common in the two decades (1990-1999 and 2000-mid 2008). Conclusions: Cost-saving should not be considered as the driving factor in the selection process of software development outsourcing vendors. Vendors should rather address other factors in order to compete in the OSDO business, such as skilled human resource, appropriate infrastructure and quality of products and services.