Episode 2: Finding the Perfect Tech Partner: Top 10 Must-Knows

Transcription:

Hello and welcome to Speedtalks, the podcast where we dive into everything tech in the financial industry.

Finding a Tech Partner

I’m Michael, and today we’re going to talk about the crucial topic of collaborating with a software house. We will explore 10 key aspects you need to consider before entering into a partnership with a software and IT services vendor. We have all heard tragic stories of projects that didn’t end up in success. The reasons behind that often result from the lack of fit between the parties. This episode should be specifically interesting for you if you’re looking for a new partner when it comes to software and IT services or if you already have a partner and are considering if it’s the right fit. Here are 10 key aspects and tips we have prepared based on our experience that you should consider to make this relationship successful. So, without further ado, sit back, relax and enjoy the meat of that episode.

Recommendations, Reviews, and References

The first aspect of working with a software house is recommendations, reviews and references. This is something you can do partially, even before you reach out to a company. When you prepare a long or short list of potential partners, you should verify their credibility in the space you’re looking for. If you are in touch with them already, verify that the recommendations and cases they use are real because everyone can fake everything nowadays. And trust me, there’s so much business done on selling reviews that you wouldn’t even imagine. So do ask for references. Check out the reviews on Clutch and G2, and ask around on LinkedIn.

Reach out to current customers. Ask them for introductions with current customers or reference customers. See whether people you know have worked with them in the past. Or see who they have worked with in the past and try to get in touch with them so they can tell you more about the partnership with that agency. And again, websites and reviews can say one thing, but the reality can differ. So, finding more information about the potential tech partner from different sources is crucial to make sure that you’re speaking with the right partner in the first place.

Experience in Your Business Domain

The second aspect is whether they have experience in your business domain. Have they worked with a similar client before? I mean vertical expertise and domain understanding. If you’re a bank, do they work with banks? If you’re a hospital, do they understand the medical industry and so on? Do they know the challenges? Have they solved a similar problem before?

Here again, case studies and portfolios can be useful, but basically, the premise is that you don’t want them to be learning at your expense. Whether it’s the domain or the technology, you want to partner up with someone who has done similar projects in the past. Because chances are that they, I mean if they have done similar projects in the past, already have the knowledge and experience that you can just tap into and benefit from straight away, they just won’t be reinventing the wheel. The bottom line is to look for someone who specialises in cases, clients, and projects like yours. This increases the chances of success overall very much.

Tech Partner’s Expertise

The third aspect is technical expertise. Are they proficient in the programming languages, frameworks, and tools relevant to your project? Do they demonstrate a track record of success, innovation and creativity in their solutions, leveraging that particular tech stack that you’re after? Do they truly have developers with the needed skills, or will they just source them once they go through business?

What’s the seniority of people working on your project? Will you have seniors? Will you have juniors in the team? These are all very important aspects. I would even suggest going a level deeper. If they say they are proficient in Java, then ask for frameworks, ask for blind CVs (resume), and ask for technical interviews with their, let’s say, core architects or experts with specific skills in the domain or with the technology that you’re looking for. How many people do they have? Was there a capacity to attract and retain more talent?

Assess whether their senior guy is really senior. Often, companies call people seniors as soon as they have five years of experience. But in fact, what you’re looking for, who you want, is someone who will be accountable, who will have the ownership of the project, who will be challenging the status quo, who will be brave enough or, let’s say, experienced and competent enough to say why they are suggesting stuff or specific alternatives, who will be able to suggest a better alternative to the one that you come up to the table with. That’s what I mean by seniority.

And please check if you’re not in a situation where you’re speaking with the senior guys in the first meetings or during the presale process, but actually, during the project, you end up working with juniors. So, make sure who will exactly be on your team and if they actually have the desired level of technical expertise.

Scalability and Resources

The 4th aspect is scalability and resources. So, while we talk about developers, consider the agency’s capacity to scale resources and meet the demand of your project. Do they have sufficient developers, designers, other skills, you name it, and other team members to allocate to your projects? Are they able to accommodate sudden spikes in workloads or changes in the project’s scope? Some agencies offer tap-on, tap-off scaling up and down to the extent that basically provides you with this flexibility. How flexible are they? That’s what should be asked in the 1st place.

And again, moving down the road, how do they attract and retain talent? What’s their attrition rate? Some of the big players out there struggle with 20-30% attrition. That means if you have a team of 10, after three years, there will be no one in the team who started working on the project three years ago. So you want to partner with someone who not only has this ease of bringing relevant people to your team but also attracting them in the long run.

Again, the scale here is a very important factor. You don’t want a partner that will be too big for you. So if you want to buy a team or partner up with a team that will be around 10 people or maybe two teams of eight, you don’t want a partner who’s got 10,000 people on board. They’re going to be too big for you. You’re going to be too small of a customer for them. And again, if you want to hire 100 people, you don’t want to work with a company that’s got 200 people in total. You’re going to be too big for them. So, both parties need to be aligned in scale and organizationally, and there are various consequences of that alignment and the lack of it.

Project Management Approach

The 5th aspect is the project management approach. You should ask about the agency’s project management methodology and processes. How do they plan, execute and monitor projects? How will you know that you’re on top of the situation and on top of the risks? Are they flexible enough to adapt to changes in requirements and timelines, should there be any? Do they provide regular progress updates? I don’t know, burn down charts, whatever. Are they transparently communicating? Do they have channels to keep you informed or in the loop? The key here is whether you will have to manage everything or will they handle it A-Z, and perhaps you already have your own delivery approach or a mindset in place. Then you should ask how capable they are of adopting it. You need to be aligned here, too. So that’s a very important aspect.

Pricing

Number six is related to pricing. It’s obvious, it’s important, but I wouldn’t say it’s the most important fact. But you should definitely ask what models of collaboration they prefer. Do they offer a time and materials model? Do they offer a fixed price cooperation? Is the company transparent with the pricing? What is the rate card? Are there any hidden costs? If you compare prices, you should definitely not take a look at the extremely low and extremely high. Often it’s, it’s, it’s just fishy. Some companies give you one price and then quickly reduce it, or some catfish promise low prices and only then increase the cost just after signing the deal.

The key aspect here, from my perspective, is whether you can afford to buy cheap. Cost should be the driver, but it should not be the most important driver. I always use this example of the three most important aspects of each project that you should consider: quality, speed and cost. In reality, you can choose only two of them at any given time. So, if you go for quality and speed, it’s going to cost you more. If you go for cost and speed in the 1st place, it’s going to cost you quality. If you go for quality and cost, it’s going to cost you on speed and so on and so forth.

So my recommendation here is to go for value for money. I would not buy the cheapest nor the most expensive one. I would look for someone who is, let’s say, the right fit, and I would remember that sometimes you need to accept that the best things cost more than the average things, so that is my recommendation here for sure.

Financial Stability

Aspect #7 is related to financial stability. It’s not so obvious but really worth checking, especially if you don’t want to start a project and hear that your provider is declaring bankruptcy after three months. The question is, are they credible enough that they’re not going to disappear overnight? Ask for proof and for paperwork. Ask for an EBITDA from the last years and results from the last years. Everything that will help you understand if they are credible and stable as a business.

Contractual Agreements

#8 is related to the legal aspects of the cooperation, so do check the contract and master service agreement carefully. Are the terms and conditions clearly outlined and fair to both parties? Are there any clauses related to intellectual property rights? I don’t know, confidentiality or termination that would require special attention. Is there suddenly something weird in the contract that you didn’t discuss beforehand?

I understand from my experience that every lawyer in the process extends the negotiating process by weeks. Yet again, it comes down to some flexibility, I guess. Remember that contracts are for the bad times, and I suggest approaching it from this different, perhaps interesting perspective. I would personally look for a partner that would go beyond the contract and the JIRA backlog and provide more value than would be expected from them. The contract is one thing, but you should be looking for someone willing to go the extra mile outside the contract clauses to ensure your project will be delivered.

Culture

#9 the culture. You definitely need to have good synergy and act like partners to have a good relationship and collaboration on a project. So, the software agency should be considered, because they are, an extension of your company. So, there needs to be a good fit between you guys. If you’re annoyed every time you talk to them during the negotiations, meetings, or workshops, it’s just not going to work. If it’s bad at the very beginning, it’s going to be bad down the road as well.

You, for sure, as a company, have your own values. So do they. Are these values aligned? You need to feel like they are a partner next door, like they sit in the next room. You should have this feeling that they are a part of your company, that you’re in this together, and this is something you just, you know, have a feeling about that you got to feel that if it clicks or not.

Communication

Last but not least, aspect #10 is related to communication. You should see whether the agency is responsive and whether they communicate clearly. Do you need to constantly ask the same questions over and over again because you’re not getting the answer? It may seem small, but it’s a huge teller in regards to how the collaboration is going to look in the future. So again, you can basically smell that from day one.

And again, it’s all about transparency and open communication from my perspective. So you should look for someone who will tell you if they cannot do something. You don’t want over-promising and under-delivering in the 1st place. You don’t want problems and challenges under the carpet. If you want to know something, they need to tell you. You need transparency, even if the truth is hard to hear. Can your partner do that? That’s the that’s the ultimate question here.

The Key to Finding the Ideal Tech Partner

And that’s it, guys. Wrapping things up, these were the 10 most important aspects related to the questions you should ask a software house before you start cooperating with them. They are related to, firstly, recommendations, reviews, and references, then experience in your business domain, then the technical expertise, then the scalability and resources, then the project management approach, then pricing, financial stability, contractual agreements, culture and communication. Thank you for joining us in this episode of Speedtalks. We hope these 10 key aspects to consider before collaborating with a software house will help you make more informed decisions regarding your future partnerships and help you find the ideal tech partner for your projects.

I would consider finding the right tech partner as an investment in your project’s success. The more resources, time, and effort you put into it, the more you will take out in the future. If you have any questions or would like to share your experiences, feel free to reach out. If you’d like to have another topic covered in one of the future episodes, do let us know. So, until next time, take care and stay tuned for more insightful discussions in the future. Bye.