Trouble with outsourcing
During the early stage of our project we decided to outsource to companies outside of Europe. We just did not have enough money to finance German developers – we thought.
We were shocked when we did a benchmark mid this year against a German outsourcing company. Even though the cost per labour was much higher, the productivity, and the quality was so much better, that the overall development cost were equal.
Fred intensivley looked after our service provider and monitored also the quality of code and discussed the issues in detail. But our complaints were not taken seriously.
After the quality of our outsourcing company decreased even further and the code they delivered and which we reviewed was really messy (not scalable, difficult to maintain etc.), we decided to stop outsourcing outside the western hemisphere and to work entirely with the German Company. We looked on all topics, which did not work and proposed to the old company a decrease the still outstanding payment. We only transferred parts of the outstanding sum. We already had agreed on decreases for not delivered parts or quality issues several times before, but always without the consequence that the co-operation would stop.
Now, including the cease of our Partnership: Endless discussions with our old service provider and unfortunately without the will to compromise at all. We even were threatened: “…If by the end of this week I am not getting any feedback and finalization on payments then we are launching another methods for getting back the money and harming your business.”
We still fight for an agreement and hope that we will seperate in good faith without getting our business harmed.
Our advice for start-ups: Never outsource to companies outside your own country.
News on this will follow…