There are two rational reasons why customers of software development projects are still attracted to fixed-price contracts:

• Budget predictability
• Transfer of technical  risk to the provider

The title of this post calls that a myth because in exchange for offloading the technical risk, the customer usually assumes the risk on requirements uncertainty. Naturally, to take on a fixed-price project, the provider will demand a fixed set of well-defined requirements and a static Statement of Work.

So what happens? As the project starts, we naturally learn more about the competitive landscape, the real market requirements, new use cases. The technical requirements change and we are left with two options: (a) stick to the fixed-everything contract and develop a product that does not match user needs or (b) change the scope of the project and adjust the schedule/price accordingly.

So, the fixed-price project is not really.

Agile Development is about recognizing the reality that both market requirements and engineering estimates will change over the life of a project. So, the agreements and software releases are iterative, fixed  for short periods of time and adaptive to the reality of execution.  Most internal software development organizations have already made that transition.

Agile Outsourcing is about finding external development partners that will be able to share technical and market risks and work collaboratively to adapt to those changes and deliver the best possible result, within schedule and budget. Most external development organizations became good at minimizing per hour cost, but are still not able to deal with change in requirements. So most software development outsourcing is still based on small fixed tasks being managed by the customer.

It is past the time for that to change. Engineering organizations know that, but companies, particularly large ones, continue to focus on "cost per head" as the main reason to pursue external development. A shift towards more meaninful metrics would benefit both software developers and product groups alike.

Daitan Group provides development services to accelerate product development in Telecom, Cloud, and Mobile. Daitan  customers can rely on a partner able either take complete ownership of a project, or work as part of a team in full Agile mode. Contact Daitan to discuss how we can help in your next project.

We have just released the first of our DaitanFlash monthly newsletters.

The Jun/2013 edition highlights WebRTC and asks the question "How are you going to use it?"

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It was early 1900's when the telephone became a medium for real-time communications. It took us 100 years to build a telecom infrastructure that brought a phone line to virtually every home in the developed world.

But that picture of universal coverage is changing rapidly. As of end of 2012, more than a third of all households in the US were no longer using a landline (source). These people have ditched their traditional telephones and rely solely on their cell phones and internet connections.

AT&T, the largest telephone operator in the US has publicly announced it will turn off its traditional telephone network (PSTN) by 2015. Regulatory requirements are the only reason that doesn't happen even faster.

The first cellular networks appeared in the early 1980's and, 20 years later, we reach the point where virtually every person in the developed world has a cell phone. In emerging countries, cell phone penetration is higher than landlines have ever been. In Brazil today, there are 260M cell phones for 190M people. China has 1.1B cell phones, 3 times more than the US. It is universal coverage again.

We are already living a new major transformation. We are starting to use our cell phones less and do most real-time communications using Social Media and Voice/Video-over IP (Skype, Facebook, FaceTime, Google Voice).

We have finally reached a point where the communication applications are independent from the underlying transport infrastructure. When we talk over the Internet, it doesn't matter what the transport is (wi-fi, cell, copper wires), applications are free from control from operators. New technologies and standards like WebRTC will further democratize access to communication functions, making them available from any IP capable device.

What is coming is a new wave of innovation, when real-time communications will be richer (voice, video, screen, text), ubiquitous (computer, appliances, mobile, wearable) and seamless (move from one device or network or media to another without interrupting the conversation).

It is the end of Telecom as we know it. Or a new beginning.

In the past years, communications applications such as Skype and FaceTime have revolutionized how consumers use computers to communicate in real-time. Grandma talks and interacts with her grandchildren through the Internet even when they live thousands of miles apart.

Now WebRTC, an emerging standard for real-time communications, is gathering a lot of attention. Its promise is similar: seamless sharing of voice, video, data. Why is it so special?

The big difference is that WebRTC is embedded in the web browser. There is no need to install a native client. Once WebRTC is available in the mainstream, developers without telecom experience can integrate communications features into web and mobile applications by adding a couple of lines of JavaScript code.

That will bring a new wave of inovation, creating disruption and new opportunities. Grandma led the way, now it is time for business to wake up to the potential of WebRTC in customer service, video conferencing, marketing, sales.

We have recently talked to TMC about WebRTC in Business. Check the interview here.

What is WebRTC?

WebRTC is an emerging standard to enable real-time communications (voice, text, video, data) directly on a web-browser running in any machine or mobile phone. It is like having ubiquitous Skype, but without the need to install any proprietary application or browser plugins.

With WebRTC, web developers can easily embed rich voice/video/data applications into web pages or apps using nothing more than  HTML5 and JavaScript. They can quickly develop new communication applications without owning media pipes (once connection is set, data flows peer-to-peer) and writing just a few lines of code.

Skype, Google Hangouts, and other stand-alone communication applications are changing how we communicate using our laptops and smartphones. WebRTC integrates that change to web services and mobile Apps.

WebRTC and Customer Service: Transforming Customer Communications

One of the greatest challenges for Customer Service today is to keep context independent of channel. A conversation that starts on the website via chat can turn into a phone call and then transition to Twitter to be eventually resolved by email.

The promisse of WebRTC is to be the single channel of real-time communications enabling the seamless transition between data, text, voice, video sharing. For example,  "Click to Call" buttons become trivial and independent of platform or type of client device.

So what we see in the horizon is a future of no more traditional phone lines, no more proprietary web widgets for chat, and a seamless, integrated channel for real time communication that will both make current problems irrelevant and create a new set of challenges for Customer Service organizations.

Where is WebRTC Today?

WebRTC is a standard driven by the IETF and W3C. It is in draft mode and is currently supported by Google Chrome, Mozilla and Opera Browsers. Safari and Internet Explorer are not yet supporting the WebRTC standards, although plug-ins are available for both browsers.

A good gateway for additional information can be found at http://www.webrtc.org/ (which is maintained by the Chrome Browser team).

Daitan Group is a pioneer in WebRTC development for business applications. Our development partners were the first in the industry to introduce call center and customer service products supporting WebRTC. If you plan to develop WebRTC services, don't start it before contacting us.

In the past decade or so the software industry has moved from waterfall to Agile Software Development methods.

In waterfall development, marketing and engineering signed a “contract” based on a fixed scope of work (the “Product Requirements Document”) and embarked in a long project based on engineering estimates of execution complexity. That provided a false sense of predictability and risk management. The problem is that requirements change and estimates are proved wrong as soon as developers start writing code, resulting in delays, budget overruns, and mismatch between product capabilities and user needs.

The idea behind Agile is that both marketing and engineering teams develop a relationship of trust and share common goals and responsibilities. Both sides agree that plans are subject to change and work collaboratively, managing schedule, scope and cost,  continuously making plan adjustments often. The result is more efficiency and better products.

Is Your Software Development Agile? Think again

Another trend in software development that has only increased in the past decade is the use of external development teams (outsourcing). It is about cost and risk management and accessing skills where they are readily available.

If you do or plan to use external teams for software development, you must transform your thinking on the relationship with them to materialize the efficiency advantages of Agile development. The interface between product developers and traditional outsourcing providers has not yet caught up with the level of transparency and collaboration required for Agile methods to work.

So, what do you need to look for when working with a software development partner?

Here are the top 3 Requirements for Agile Outsourcing:

1. Cost Efficiency.  Yes, there are other good reasons to outsource, but managing development costs is still an important driver. The common mistake is to focus in hourly cost per developer. You need to think cost of results and development organizations working in Agile with more capable developers should be able to deliver a lot more than just low cost per head.
2. Technical Capabilities.  In an Agile development team, every member must interact with others and contribute their ideas. If external developers are seen as second-class contributors, you are on the wrong path. They should be as capable as the internal team and bring their previous technical and process experience in similar projects to add value to the relationship.
3. Collaboration and Communication.  Since outsourcing often involves teams in different countries, factors such as language, time zone, cultural differences can be a challenge. Before starting a project make sure you can trust your partner and that the communication infrastructure is adequate and that there is a good match of culture, language and capabilities to communicate in real time. Joint development is not a transaction, it needs to be a trusted relationship between teams.