29) Black-box model and trust-building in software outsourcing development

Black-box model is well-known for its effectiveness in terms of software development outsourcing. It is based on the assumption that the software outsourcing company can smoothly meet a client organization's demands without the two partners having to deeply understand each other’s domain. However, this model gradually reveals its limits and some corresponding solutions are required. It has been found that the black-box approach is usually compatible with routine projects but fails in projects involving situations never encountered before. As for which part should get an insight of the other part depends on where the new part lies in the project. Theoretically, if the projects present new parts, it is the outsourcing company’s job to understand the client’s business. On the contrary, if the projects involve newly introduced development processes, the client is required to have deeper technical expertise.

Trust is an important element in all kinds of business cooperation, without which the relationship can not stand long. However, trust has been relatively under-explored in software outsourcing relationships. Some experts say that trust can be tagged as the most fragile factor in an outsourcing partnership. The methods to gain trust can be classified according to two different situations——trust building between first-time outsourcing partners’ and maintenance of ongoing outsourcing relationships. There are several critical factors for achieving initial trust. Opinions and recommendations from previous clients and experience of the software outsourcing company in the outsourcing industry are all important. When it comes to maintaining trust in an established outsourcing partnership, transparency, demonstrability, honesty, processes followed, and commitment are all factors that both sides should consider.