“What could go wrong?” — Managing risk during software development projects

It’s no secret in the tech industry that an unacceptable number of software development projects end in failure. While nobody knows the exact numbers, most in the industry have been exposed to at least one failed project. Veterans of software development efforts know the risk of failure, to various degrees, exists, but what are the odds? And how can the known and unknown risks be identified and reduced, or even eliminated? What if you could partner with a firm that could greatly reduce the odds of failure and radically increase the odds of a winning outcome? We’re talking a big swing from the typical outcomes. Here’s what you need to know to understand and assess risk management when choosing a software development partner.

What is the risk in software development?

The two biggest risks in software development are that a project will go over budget and over schedule. This can obviously impact your bottom line, but it can also disrupt operations and cause some pretty serious problems. Project delays can cause you to lose credibility with your investors, clients, sales force or company executives. You could miss a market opportunity that was seized by a competitor, or an opportunity to implement massive efficiencies that could have freed up cash flow and increased the value of your company.

It’s important to note that despite the horror stories out there, most projects don’t fail dramatically. Rather, they fall short on requirements, quality, reliability, architecture and technology. Sure, the software may work, but these issues can lead to technical debt and the system may need a lot of costly work to reach minimum standards. Even then, the software will be expensive to maintain and the total cost of ownership is often unacceptably high for an application that has a short tenure. Given all of these potential issues and the consequences they can bring, it’s clear why mitigating risk is crucial for a successful software development project.

How to assess risk in a development partner

The best way to mitigate risk is to choose a development partner with the right people and processes in place to avoid potential issues. But how can you tell? The key is to ask questions and demand proof.

For starters, ask any potential development partner about how they conduct risk analysis before beginning a project. Firms who understand the serious consequences of failed projects will perform both a qualitative and quantitative analysis to identify unique risks for every project. They should be able to produce some form of written documentation showing they’ve evaluated the risks and have a plan for how to mitigate them.

You should also ask about what kind of development methodology they use to build software. While no one methodology can eliminate risk all on its own, just knowing that the company has an established process can help address issues quickly and effectively, should they occur.

There are also individual data points you should ask about that can give you a more complete picture of how the firm manages risk. For example, ask about the percentage of projects they complete that run over schedule, how many developers they have on staff, if they ever farm out projects to outside agencies, and how they track milestones throughout the development process. By getting a better sense of a firm’s processes and the mechanisms they put in place to mitigate risk, you can feel more confident that you’re making the right decision.

How to manage risk during a software development project

Ideally, you’ll be launching your new custom software project with a proven firm that includes risk management as a core principle in their development process. But that doesn’t mean you don’t have your own role to play. Effectively managing risk for your company means taking an active role in project management. Here are a few quick tips that can help ensure a successful project:

Plan accordingly — They say the best laid plans of mice and men often go awry. But that doesn’t mean you shouldn’t do your best to account for any potential risks up front. By working with your software development partner to formulate an exhaustive plan that covers all necessary system requirements, integration needs and the business case, you can help avoid issues before development even begins.

Keep lines of communication open — Throughout the project, make sure to prioritize communication between you and the development firm, and between stakeholders on your own internal team. Establishing a strong connection with your project lead will help quickly address and eliminate any small issues that will inevitably come up during the course of the development process.

Embarking on any kind of software development project always comes with a certain amount of risk. It’s just part of the game. But by taking time to fully evaluate any prospective partners and then taking an active role in the development process, you can mitigate risk as much as possible and help ensure a successful software development project.


About Saturn Systems

Saturn SystemsSaturn Systems is an entirely U.S. based software engineering firm that provides a broad range of services, from project-based development and quality assurance testing to fully integrated staff augmentation teams. Saturn's Rural Outsourcing model couples the lower cost of doing business in Duluth, MN, with an experienced engineering team - making Saturn an attractive alternative to high-priced metro firms and the inherent difficulties of offshore services.

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