Ciklum Released White Paper on Why Adopt Nearshore Agile Development

Ciklum, the European leader in IT nearshoring for Small and Medium Enterprises (SMEs), released a white paper that presents nearshore Agile development as a relatively new, yet effective Outsourcing 2.0 trend, that is able to better meet with the challenging requirements of today’s high-tech environment compared to the traditional offshore waterfall development.

Copenhagen, Denmark, May 17, 2010 --( Alarmed with the findings of the latest CHAOS Report saying that as of 2009 only 32% of all outsourced software projects have succeeded, while 24% have failed and 44% were challenged by late delivery, over-budget and poor functionality, Ciklum analyzed a lot of factors and concluded that the waterfall model is a key reason of the most projects’ failures. This finding generally supports the results of the IAG Consulting study of 6,700 projects suggesting that 4 out of 5 major factors contributing to the outsourced project failure were largely associated with the waterfall model. According to the study, as of 2008 68% companies experienced a waterfall project failure due to: taking over 180% of the target time to deliver; delivering under 70% of the required functionality, and wasting over 41% of the IT development budget remaking the end product as the result of poor requirements gathering at the project initiation and planning stages. However, the most dramatic legacy of the waterfall model is that it became hardwired into the project planners’ mindsets, making the entire software development process packaged, plan driven and bureaucratic.

In its released white paper Ciklum describes the typical behavior of offshore outsourcing services providers who offer their clients pure waterfall development regardless of their business needs, budget and project scope, while upgrading own infrastructure and processes as required by CMMI and other organization’s maturity certifications, at the clients’ costs. The white paper shows that typical offshoring to providers with a strong waterfall software development tradition has proven to be illusory and ineffective for Western European clients, located thousands of kilometers away. Contrary to that Ciklum presents nearshore development as a cost effective yet better quality alternative to offshoring and concludes that the mix of nearshore and Agile development is the best solution for Western European companies, looking out to leverage their IT goals at reduced costs and retained product quality.

In addition to the benefits of using nearshore Agile development the white paper addresses two major concerns which are always associated with Agile development - lack of upfront planning and predictability. However, Ciklum’s analysis and own experience as a nearshore IT outsourcing leader suggests that these are just two misconceptions generally related to the lack of understanding of the incremental planning approach. Ultimately the paper busts these two myths and concludes that although Agile is not a panacea, it offers process, engineering and managerial practices which allow for higher degree of discipline and sustainability in every single area of software development, from test-driven to continuous integration to daily stand-ups. Thus, it is a perfect option for small and mid-sized Western European companies as it offers enhanced ability to manage changing priorities, improved alignment between business objectives and IT, faster time to market and simplified development process.

To read the full white paper, go to

Ivan Pohrebniyak
+38 044 545 77 45 ext. 225