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The Best Practices in Outsourcing Software Development

26 May 2020 17:30, UTC
The Best Practices in Outsourcing Software Development
By Charles Richard

What drives globalization nowadays are business objectives. Nonetheless, the reported number of breaches in data security becomes a major issue for businesses and top managers looking to establish distributed teams or reap the benefits of outsourcing not only locally, but also internationally.

For reliable and efficient collaboration among organizations and outsourcing service providers, the outsource software development services field has identified the main information security problems and defined the best practices and contractual provisions as well.

Software Outsourcing Best Practices

I. Risk Assessment outsourcing for business owners

The number of security occurrences all over the world has alarmingly grown. In the worldwide scenario, militaries and governments are not the only industries that suffer cyber-attacks. Other sectors, including healthcare, education, financial and others also suffer considerable losses because of leakage in personal information.

Among the countries that suffered the biggest breaches in security include the US, India and the Middle East. The costs are both direct and indirect. The former is composed of detection of breach, notification and mitigation costs. The latter involves the growing customer turnover, losses in reputation and the escalating costs in customer acquisition.

II. Client security issues

Has three primary concerns for top managers and business owners.

  • The right app for security controls from the vendor. Due to the legislative differences, cross-border cooperation is complex. Further damage to the trust between both parties are contract violations.
  • Abuse-free handling of proprietary information. Loss of proprietary information by an outsourcing software development company could cause the loss of business capability, particular industries that are over-regulated, including the finance and healthcare sector. Customers are wary of entrusting their proprietary information to vendors since security breaches could have a considerable impact on the finances and reputation of an organization.
  • Standards compliance and security policies. To ensure security, business organizations could not afford to waste resources and time on analyzing the policies and framework of a vendor. They need outsourcing partners to adhere to standards or provide better options. The critical trust and understanding could be established with the right documentation on client-approved security protocols.

III. Vendor security problems

Transparent communication, bilateral trust and efficient development are critical. Nonetheless, based on research, the main security issues of a vendor vary from those of the clients. Among the vital factors that impact security, IT firms have emphasized experience and competence in in-house information security. Service providers consider the information security expertise of the software engineer a critical factor and a competitive edge. Nevertheless, most organizations do not understand that customers consider competence as a basic requirement and the expectation is to achieve high-quality services. The contradiction could lead to misunderstanding, dissatisfaction and loss of trust.

IV. Extensive and clear outsourcing approach

Business owners lack outsourcing efforts that impact development quality and speed. The main causes of tension for an outsourcing software development company are indecisiveness and a piecemeal approach to outsourcing. They expect clients to have a predictable security requirements set.

V. Tacit protection of knowledge from dissipation

Sharing of resources and competencies among vendors and clients to gain benefits from outsourcing. Outsourcing vendors are willing to adapt to the processes and security protocols of clients, but not at the cost of dissipation of in-house knowledge.

Business data security best practices

1. Awareness and compliance of regulations.

Contracts in software outsourcing should have extensive legalities information. The lack of awareness of regulation by both parties could lead to the occurrence of compliance risks. To avoid risks in compliance, experts have recommended supplying outsourcing contracts with extensive legal information, including the country of operation and origin, a list of national regulations that should be complied and industry-centric regulations that the project has to comply with.

2. Fulfillment of the ISO/IEC 27000 requirement

An integral contract provision is the fulfillment of the outsourcing vendor to the requirement. The Information security management system (ISMS) is an extensive approach to protect sensitive data within the firm and the provider. The ISO/IEC 27000 standards include personnel, IT systems and processes requirements, which are all necessary for managing security risk.

3. Watermarking of data

This helps promote sensitive and careful management of data. Techniques applied to relational databases containing customer data do not prevent leakage. However, it helps in establishing the source and resolving it. Recent developments enable fast permutation-based or insertion-based watermarking and fingerprinting of databases without corrupting data or introducing errors. Along with active prevention methods, the passive techniques boost security in outsourcing.

4. Client and Vendor security audit

Primary security audit for a client and the outsourcing provider identifies possible problems and critical weaknesses. A secure software outsourcing practice is established via a combination of organizational capability and strategic context. The former combines operational audit, knowledge management and competence.

The latter implies compliance in regulation and alignment with security policy. The factors, along with metrics that are pre-established comprise of audit parameters that should be evaluated regularly throughout the development process.

5. Building IT outsourcing trust

Trust could be created through the realization of trust building techniques. The trust building in outsourcing Information Technology nonetheless is not applicable to international processes of the customer organization and the outsourcing vendor. Only mechanisms that are applied between the partners promote one or a few trust building dynamics, in which mutual trust occurs.

6. Sensitive encryption of data

The most effective security method is encryption. It is however limited to instances when the outsourcing provider does not need information access to use it. In these cases, vital information, like credit card numbers for instance could be encrypted with a public key cryptography. The software outsourcing service provider doesn't get information access, but could transfer it to third parties for processing and decryption.

About the Author:

Charles Richard is a Business Analyst at TatvaSoft UK. Besides his profession, Charles likes to share some new and trending technical aspects. To know more about his leading outsource software development company in London, please visit

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