Many companies are looking to outsource development and maintenance of their application software. Common reasons that companies outsource application software are to reduce their costs, improve quality, obtain flexible staffing levels, and obtain improved service and support so they can focus on their core competence such as, designing clothes, managing equity portfolios, or running hospitals. Choosing whether to outsource or not is a strategic decision for a company. Once a company has decided to outsource, however, it must still choose an outsourcing approach that best fits it needs. This paper will describe the many different options for application software outsourcing, including the advantages and disadvantages of each alternative.
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some portion of its software development and support, select an outsourcing provider, and then transition the work to that provider. However, an important step needs to be considered before selecting a provider. Companies must decide which outsourcing model they wish to engage. There are several ways that a company can utilize an outsourcing provider to supplement or support their application software. Among them are the following alternatives: Specific project model Supplemental model On-site model