This is a huge issue especially in the current economic downturn as everybody is looking for the best deal in town! Well with application/database development the best deal in town is not the one with the lowest dollar amount. Rather it’s the one that has feasible and reasonable cost estimates and more importantly with the right group of developers. The truth is when you go out to look for a company to do an application that your business depends on, before you sign that contract and pay the deposit, make sure the company can do what it promises. Check their references and find out if they have a history of commitment to their clients. It’s easy to say that we can do it and also we can do it in a required time frame. Remember that once you pay the deposit, you are hooked.
Naturally companies that send their work overseas will have the lowest costs. But unless you get extremely lucky (and in all these years, I have almost never seen that happen), you could be taken for a ride. You will be out of your money and your project will take 5-6 times the time it may take to finish here. Sure, in the beginning the cost is very attractive but then as your project goes on, you will see promises not coming thru and excuses come one fter another. And most of the time you are lucky if the project even ends. In many cases that I have seen at best overseas companies complete about 90% of the job and then you will be here looking for a company to do that last 10% only to find out that this 10% may cost you more than the 90%! Why? Because working on existing code is generally extremely difficult. You will have to pay for the new company’s learning curve and then how do you know that the code coming from overseas is well documented. Then also, After everything is complete, you will have the two companies blaming each other for any problems. Now after several years a project that should have completed in six months, is taking you about three years to finish and you have paid the same amount that you would have to pay if you had done it all locally. That’s as I said, if you are lucky!
Also remember that with complicated enterprise database applications, you have to have quick access to developers. Sometimes it may take several meetings to get one single requirement understood. Just imagine how that would work with an offshore company with different time zones, language barrier, etc.
Do your homework. Know who you are dealing with. Check references and make sure the scope outlined in the proposal is complete.