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Software development, maintenance and support

The reasons for choice of supplier or remote location for the software development function, shown in the graph below, demonstrate that by far the most important consideration (not surprisingly) is technical expertise, which constituted 31.2 per cent of the reasons mentioned on the demand side and 22.3 per cent on the supply side. This is buttressed by a requirement for quality, reliability and a positive attitude (10.9 per cent and 20 per cent of reasons respectively). However, the need to find these qualities is balanced by a search for low cost, which constituted 13.2 per cent of reasons cited on the demand side, though only eight per cent on the supply side (Huws, O’Regan, 2001).

The case of software illustrates a pattern which also appears in the market for some other eServices whereby suppliers tend to over-estimate the value of their existing relationship with their customers and the quality of their work and to underestimate the value of their price competitiveness when compared with the assessment from the demand side.

Reasons for choice of location for software development and support: supply and demand side

(Source: Huws and O’Regan, 2001)

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© 2002, Institute for Employment Studies