Customer-Supplier Issues in Software Development

Satya Jaya Aparna PasiKari SmolanderUolevi Nikula

Lappeenranta University of Technology, Finland

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Motivation

• Customer and Supplier – two separate organizations.

• Previous research on software development has shown customer as one of the main challenges.

• Issues of the customer and supplier interface was of interest.

• Studies on customer and supplier related issues are rare.

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Research Questions

• Main research question was to identify the customer – supplier issues in tailored software development.

– Does the supplier have sufficient domain knowledge to develop software?

– How are changes managed during the projects?– What kind of knowledge transfer difficulties are there between

customer and supplier?– What kind of a relationship do customer and supplier share?

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Data Collection

• Data collection : October 2006 – January 2007. In total 18 interviews were conducted.

• Theme based interviews were conducted in 2 Finnish and 1 Russian organizations.

• Roles of the interviewees were from upper managers to developers.

• Interviews were later transcribed and analyzed using grounded theory.

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Research Methodology

• Grounded theory a qualitative research methodology was used.

• Open coding, referred any text passage referring to customer.

• Marked sections were recorded as codes by assigning a label that identified the customer-supplier related issues.

• Axial coding was to relate the categories to their subcategories to form more precise and complete explanation of the categories.

• Axial coding phase was started by grouping similar codes into broader categories.

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• For example in axial coding,– customer influence and customer participation were grouped

under customer effects– while insufficient requirements and incomplete knowledge on

customer business were grouped under insufficient domain knowledge.

• At the same time we also learned about the relation among the categories, for example, – both insufficient knowledge on customer’s business and

language barrier had caused insufficient requirements

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Observed Issues

• Knowledge transfer difficulties– Insufficient domain knowledge– Incompatible terminology– Language barrier

• Change management during the project• Customer dominance

– Customer dominance on process– Business induced power asymmetry

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Knowledge transfer difficulties

• Knowledge transfer difficulties in the case companies were caused by– insufficient domain knowledge, – incompatible terminology– language barrier.

• All three issues cause lack of information to the supplier and may result in misunderstanding requirements and inability to deliver useful software to the customer.

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• Difficulties observed:– Insufficient domain knowledge: Customer was not willing or unable to

give their business application domain knowledge to the development team.

– Incompatible terminology: Incompatibility between the different terms of software developers and customer team, such as users and customers.

– Language barrier: Language barrier refers to the issues that are caused by the limited knowledge in the used language for ex. difficulty in speaking to each other and translating documents.

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Change management during the project

• Change management refers to the changes that are introduced during the project by the customers.

• Requirements often change. These changes from the customer can be due to changes in laws, business needs and technology.

• Case companies reported that changes are often difficult to implement because of deadlines, resource problems, and complex development environments.

• They pose a problem in the case companies due to:– Restricted schedule– New resources needed

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Customer dominance

• Reflects the power relationship that exists between a supplier team and its customer.

• The customer dominance has received much less attention in the previous research than the issues discussed previously.

• We see the dominance through:– Influence of customer on process selection – Business induced power asymmetry

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• Customer dominance on processes

– Customer dominance on process is defined as a situation where the customer dominates the software development process selection and resulting in a situation where the supplier is not able to follow a process of its own.

– The customer has total control on the project and the process of developing it. As a result the project is developed haphazardly.

– Customer does not realize the importance of working in similar terms with the supplier.

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• Business induced power asymmetry

– Fear of losing the customer forces the development team to promise unrealistic deals.

– Often accepting customer demands during the final

stages of the project leads to changes during the final phase of the project.

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Effects

Observed issue Observed effect

Knowledge transfer difficulties

Insufficient domain knowledge

Lack of business application domain knowledge leads to requirements misunderstanding and inability to address the customer needs.

Incompatible terminology Terms are understood differently which leads to requirements misunderstanding and inability to develop useful software for the customer.

Language barrier Development team lacks information needed from the customer which leads to requirements misunderstanding

Changes brought during the projects Poor quality and delayed projects.

Customer dominance Customer dominance on process

Project is developed haphazardly as it lacks the development team’s control on the software development process leading to poor quality software and delays in project schedule.

Business induced power asymmetry

Constantly responding to customer demands leads to poor quality software and schedule delays.

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Summary of the research

• This study explained how customer-related issues are frequently happening in software development projects. It also stated the effects of such issues.

• This study has brought a unified view to the customer-supplier related issues and added customer dominance to the list of issues.

• The study has its limitations:

– All the studied case organizations were developing tailored software and therefore similar kind of observations can be expected primarily in tailored development.

– Another major limitation is that this study has the supplier viewpoint only.

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Further research

• Role of trust in customer – supplier relationship.

• Customer participation – how beneficial is it to customer himself?

• Critical success factors to manage customer – supplier relationship.

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• Thank you for your attention!