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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?"
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.
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