In 2011 I wrote a dissertation on Agile and outsourcing. After analysing all of the data I had collected along side that publicly available from various sources including Microsoft, Ambysoft (http://www.ambysoft.com/surveys/) and The Agile Alliance the only conclusion I could reach is that Agile and Outsourcing were incompatible. The fundamental obstacle was the contract between the vendor and the client.

Things have come a long way since then and it is possible to run projects in an agile manner. But only if the client understands the level of commitment required on their part. Having been on both sides of the contract I am finding that there is still a disconnect here. Often the expectation is that an Agile project can be run with the same level of customer engagement as a project run under a waterfall methodology, with a greater degree of success.

I exclude body shop engagements from the above as in those cases the reality is that the customer isn’t paying for the delivery of a project they are paying for the use of a specific type of resource/expertise.

So when are outsourced Agile projects successful? When the vendor is responsible for the delivery of the solution and has full commitment from the customer to be available at the agreed level. It all lies in the structure of the contract. The contract needs to be balanced and clear about the responsibilities of both parties and state the consequences from a delivery perspective if any of those responsibilities are not met.

Agile also does not work under a fixed price contract as the core tenet of Agile is the ability to deal with change. and fixed price is the antithesis of change.

Failure to acknowledge any of this is a recipe for disaster.