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Why Do Outsourcing Projects Fail Most Of The Time?

Randy RayessRandy Rayess

The main reason offshore outsourcing projects is viewed negatively is that many companies have lost both time and money when they have outsourced to an offshore firm. Because of a negative experience, many advise friends and colleagues not to outsource their development offshore. These experiences perpetuate the notion that outsourcing is not in a firm’s best interest, but companies can benefit greatly from outsourcing projects when done correctly. Failure rates are high for outsourcing projects to an offshore partner because of a variety of factors.

Cultural Differences

The remote team may not understand the local design and culture resulting in miscommunication. Its important to properly screen firms to ensure that the development firm understands local and modern design trends.


A language barrier may exist as the team might not speak English fluently. Screening firms to ensure that their developers and project managers are fluent in english is crucial.


Time Zone Difference

A difference in working hours can pose a challenge to schedule calls and communicate daily. It is important to be aware of the time difference going into the working arrangement and ensure there is daily overlap of at least 2 hours.

Technical Skills

If not vetted property, the remote team might not have the right technical skills to complete the project.Companies must screen firms to ensure that they have the right level of technical knowledge to work with your team.


If the remote team is not treated properly, they may not be motivated to complete the project in a timely and efficient manner. You should treat your remote team with the same kindness and energy as your in house team.

Multiple Projects

If the remote team is working on multiple projects then it may be harder for them to communicate properly to each team. They will end up getting overworked, making more mistakes or not working fast enough. To protect against this, its better to have the remote team commit to only working on one project at a time.

All of these issues are addressable if a company has a good selection process to choose the right partner and the right communication process to motivate the partner and manage expectations.

There are also many successful offshore outsourcing projects and engagements that have worked well because each side properly addressed the key risks outlined above. Fab has greatly benefited from leveraging an offshore partner that they have even bought out the partner firm. For many companies, the pros of outsourcing projects outweigh the cons that are usually a result of poor planning and communication.

Need help with your outsourcing efforts? We’d love to help. Get in touch here.

CoFounder at VenturePact Passionate about software, marketplace startups & remote work. Previously at SilverLake Partners, Ampush and Wharton.