Application Service Providers Or Consultants?

ChosenOne asks: "I'm working for a company that is currently at a crossroads on how to implement their Web site. They have a clear concept of what they want, but they are trying to figure out who will do it. It's boiling down to two main contenders: an ASP, which has a suite of services that is not exactly like (but similar to) the design specs for the concept, and a consulting group, which can code exactly to the design specs that we set for them. My company is nervous about using the consultants; they're afraid of ballooning costs. I'm afraid we'll want something that the ASP we'd be using can't provide. Anyone have any ideas?"

Comments

Not enough information

[dubl-u]

Both options are reasonable choices; both have their risks. The right answer depends on the details.

If you want a useful answer, you have to tell us a lot more. Start with your company's experience and resources. Have you managed outsourced development before? Do you have developers in-house to manage and check their work? Do you have experience in hosting and managing the application if you outsource development?

Then tell us about your business plan and goals. Which set of risks would be worse for your business if the worst happens? How much change do you expect in your requirements? (It's rare that the requirements at the start of the project are the same at the end.) How do you guarantee that once you have v1.0 that you can move to v1.1 and v2.0 without starting from scratch? How likely are your future needs likely to diverge from the ASP's main market?

Then tell us about the different vendors. What kind of reputations to they have? What kind of guarantees will they be willing to make? What are their portfolios like? If they screw up, do they have the resources needed to do it over for free? Will they let you talk to a client where they've done that? If a vendor goes bad, what plans do you have to migrate your clients and your data to a new system?

It sounds like you already broadly know the risks and potential rewards of the two paths; the right choice depends entirely on the details. And if you don't want to give the details to the public, than maybe you should (ahem) hire some of us to help you sort it out.

Beware the consulting morons.

[AFCArchvile]

alias, Idealab. They've consulted with many companies that made it to this nefarious list. Also, Idealab has a tendency of making smarmy slogans/logos/names, so avoid them like a leper.

had the same problem.

[Zurk]

a year ago i applied and got a job at a small company building a web based system. they had spent 4 years building it with 4 different teams (average teams lasted 6 months to 1.5 yrs) with programmers from MIT, consultant groups, in house programmers etc. result ? 4 years and 2 million dollars and i ended up throwing the whole mess out and started from scratch by firing the 15 people working in house and firing the consultants. one year later the system now works and im out looking for a job since selling the stuff is really not what im here for. anyway, my point is consultants can burn you hard. so can ASPs. in house programming is best IF THE PEOPLE ARE COMPETENT. so - GET COMPETENT PEOPLE and MAKE SURE THEY DELIVER. get realistic schedules and get a good team with clear guidelines. open source programmers who have worked on 5-6 projects are best. they usually wont let you down. BTW, im no longer in the US so you cant hire me. :)

Consultants: bad. In-house: good.

[Anonymous Coward]

My employer (who, like me, shall remain nameless) used Viant. What a complete fucking disaster. They couldn't be bothered to really understand what we were doing, or sometimes what their predecessors had done. They had lots of meetings to discuss The Process. The Process involved many, many more meetings, which were all a huge waste of time. They delivered broken HTML. Late. Every single developer hated their guts. The whole thing was a fiasco that delayed our launch many months, and cost us several hundreds of thousands of dollars.

Viant left in disgrace, and the product management idiots who brought them in are now looking for work.

Bringing in an ASP is another option, I guess, but seems to have the same problems that I saw with Viant: if something is crucial to the success of your company (does that describe your web site?) then you had better do it in-house. No one else will understand your goals well enough, or care about it enough. You can farm out pieces of it, e.g. some of the graphics, certainly the hosting, but it's a mistake to farm out the whole thing. And don't forget, once it's done, you'll want to change it. Your consultants will have moved on. You are going to understand better than anyone else what needs to be done.

Re:Consultants: bad. In-house: good.

[dubl-u]

My employer (who, like me, shall remain nameless) used Viant. What a complete fucking disaster. They couldn't be bothered to really understand what we were doing, or sometimes what their predecessors had done. They had lots of meetings to discuss The Process. The Process involved many, many more meetings [...]

Facinating! (Hey moderators! Moderate the AC post up so others can see the whole thing.) This sounds a lot like Verde.com's experience with sound-alike consulting shop Scient, at least as told in the article How Scient helped Verde.com go from launch to bankruptcy in less than 60 days. And everybody there had to remain anonymous, too.

I broadly agree that putting somebody else in charge of the very heart of your business is a dangerous thing, and I generally discourage it. But people can also tell in-house development disaster stories, so that's no silver bullet. Indeed, I've seen projects fail because management couldn't resist meddling in in-house projects. An external vendor has more power to deflect or channel insane client demands; that power can be very beneficial to a project if used wisely.

One important distinguishing factor is whether or not you have a lot of ongoing development needs. Some projects have a huge amount of inital work and then a much smaller amount of ongoing work; it doesn't make sense to build up a big in-house staff, get them to work as a team, train them to your needs, and then fire half of them when the project is done.

On the other hand, most clients (and non-technical bosses) tend to overestimate the need for a big initial push and underestimate the need for ongoing work. As any developer knows, what people initially imagine they want and what they actually end up wanting once they've been through several iterations of development are usually pretty different. And if you're doing a web site or other Internet-delivered service, you can usually roll new features out gradually, further reducing the need for a huge initial dollop of work. So if your project can use an evolutionary delivery model building an in-house staff can make a lotta sense.

For people interested in these topics, I recommend Steve McConnell's Software Project Survival Guide. And if you're a developer, project manager, or somebody else actually working on a project, his Rapid Development is also great. And hey! I hadn't seen this before, but he wrote a magazine article on Managing Outsourced Projects.

PLEASE tell me you're not serious!

[Micah]

I've NEVER been madder at a computer than when I had to use FrontPage at a former job. It LIES to you about what kind of HTML it's generating, and it REVERTS YOUR CHANGES when you go in and edit them mannually, and it SCREWS YOU UP when you're trying to move table elements around!

Writing HTML by hand is MUCH quicker and the result is MUCH higher quality.

OK, that was FP 97. Maybe they've fixed one or more of these problems, but knowing MS, I doubt it.

Re:PLEASE tell me you're not serious!

[WickedClean]

No they f'ing didn't fix them. They added more 'features' which further screw with your pages. What I love is editing text and watching other random bits of text change fonts and font sizes. FP2K sucks arse.

Depends on your ability to oversea it...

[alexhmit01]

At my last fulltime job, I was busy recruiting programmers and undoing the mess left to us by the consultants. A dot-com without a technical team. I had to go through it, replace just about everything, and we did it piecemeal (didn't realize how bad it was until the end, and even then we found ugliness).

Ironically, I'm now trying to get a consulting firm up, and we'd never do a mess like those guys. Still, consultants are risky.

ASPs are also risky, with the market today, check their financials, wouldn't want them to go under in 6 months with no warning (happened to a friend's company with their DSL provider... had 7 lines going to go dead in 2 weeks with 6 weeks to get them switched to a new company).

If you can monitor an ASP, terrific. If you can manage the consultants, terrific. Otherwise, make sure you go with a trustworthy group using standard technology that you can check up on regularly, and if need be take over the project midway.

Good luck,
Alex

Core Business?

[jheinen]

Speaking as a consultant, I'd have to say a lot depends on what you're trying to accomplish. If this web site is a core piece of your business, then I would suggest it be done in-house. There are few things as flawed as trying to run a business in which you leave the most important core functions to someone else. If you don't have the technical resources to do this, then I think you need to ask yourself why you are trying to run a technology-based business without the resources necessary to do it.

If, on the other hand, the capability you are trying to build is ancilliary to your core business, or it is part of the infrastructure that supports your core business, then consultants are great (note I said consultants, not contractors), provided you have a clear idea of what you want to do, and what you expect them to deliver. If you approach a consulting firm with a nebulous idea, you will only get something nebulous in return, and the costs will skyrocket. Also, my advice is to go with larger established firms, as they have a rigorous hiring procedure that ensures at least a minimum level of capability. They are more expensive, but in my experience they are much more likely to deliver a quality product on time and within budget. Certainly there are some smaller firms that are outstanding, but it's difficult to know what you're getting until after the fact. I've been in enough situations of having to come in and clean up after the inexpensive small firm toitally botched it. This is especially the case when the project is large and/or involves a lot of integration with third parties and legacy systems.

ASPs are great if your requirements mesh nicely with what they provide. Again, this only applies if this is not a core part of your business. Using an ASP to support less critical capabilities can help free up your resources to focus on your core business (but if your core business *is* the piece you are thinking of outsourcing, then again you need to ask yourself if you're headed in the right direction).

-Vercingetorix

solution

[Operandi]

i may know exactly what you're looking for, email me at contactk@hotmail.com with your specs