What are the best practices for secure IT outsourcing?

Could you give some advice for startups? :bulb:
How to keep offshore app development secure and cost-effective? :money:

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You could try Upwork as a sort of trial and learning experience. There’s a lot of factors to take into account when you go the offshore route.

Upwork isn’t very reliable platform :roll_eyes:
I’d like to know about secure collaboration with the offshore service provider

Best Practices to Ensure Business Data Security while Outsourcing IT work.

Regulations Awareness and Compliance:
A lack of regulations awareness by the business owner and the software outsourcing company can result in compliance risks. Businesses are accountable for not complying with national or industry regulations, resulting in fines and reputational and financial losses. To prevent compliance risks, I recommend supplying outsourcing contracts with comprehensive legal information, including:

  • the company’s countries of origin and operations

  • the list of national regulations the project must comply with

  • the industry-specific regulations the project must comply with

Security Metrics Establishment:
Information security metrics can prevent outsourcing relationship failure if established and agreed upon at the onset of the project. Internal vendor metrics include:

  • Organizational parameters that assess security management procedures

  • Operational metrics that evaluate operational security

  • Technical characteristics that identify the quality of hardware and software

Password length, update interval, and compliance with standards are just examples of security metrics. However, their monitoring and enforcement by the outsourcing company are often in question, as the client does not possess access to the internal logs that can be altered to meet the vendor’s needs.

Vendor and Client Security Audit:
Preliminary information security audit for the client and the outsourcing vendor enables the identification of critical weaknesses and potential problems. Secure outsourcing is established through a combination of strategic context and organizational capability. The former implies regulation compliance and security policy alignment, while the latter combines knowledge management, operational audit, and organizational competence. These factors along with the pre-established metrics comprise the audit parameters to be evaluated regularly in the course of the project’s development.

Data Protection and Leaks Prevention Methods

Non-Disclosure Agreement:
A non-disclosure agreement (NDA) is designed to protect the client’s business idea, source code, trade secrets, and right transfer. The NDA includes information on the protected data, the agreement duration, the governing law, and breach-of-contract consequences. The type of agreement violation and the amount of damage inflicted upon the client define the penalty. Contract termination, fines, and jail time are the common short-term penalties, while reputational damage and the loss of future client prospects are the unavoidable long-term consequences most outsourcing vendors try to avoid.

In addition to NDA, Non-Compete Agreement (NCA) also provides the means to prevent the vendor from working with the client’s competitors or developing similar products. However, the non-compete clause efficiency depends on the jurisdiction and can be negated by local regulations.

Data Watermarking and Fingerprinting:
To promote careful and sensitive data management by the outsourcing vendors, clients resort to digital watermarking and fingerprinting. These techniques applied to relational databases containing customer data do not prevent data leakage but help establish the source of the leak and address it. Recent developments allow for quick database permutation-based or insertion-based fingerprinting and watermarking without introducing errors or corrupting the data. Combined with active security breach prevention methods, these passive techniques increase outsourcing security.

Sensitive Data Encryption:
Data encryption is the most efficient information security technique; however, its application is limited to the cases when the outsourcing company does not require access to the information to be able to use it. In such cases, critical information (SSNs, credit card numbers, etc.) can be encrypted using public-key cryptography. The outsourcing vendor does not receive access to the information but can transfer it to third parties for decryption and processing.

Building Trust in IT Outsourcing

Trust between a client and an IT outsourcing vendor can be created intentionally through the realization of trust-building mechanisms that develop bilateral dynamics necessary for a fruitful partnership. However, this model of trust-building in IT outsourcing is not applicable to internal processes of either the client or the vendor. Only those mechanisms that are applied between the partners promote one or several trust-building dynamics, through which mutual trust evolves.

The best information security practices discussed above form the basis of trust in IT outsourcing. However, efficient communication, personal interactions, and expectation management are also important facets of an outsourcing relationship that should be nurtured and developed with care.

Teclogiq is one of the best company in India to outsource your IT related work for secure and cost-effective services.

its very difficult to build a successfully startup with an offshore app development company as your only development resources.

I contacted a lot of startups when I owe my previous company. I got blinded by fancy words like - “There a big needs in developers”, “Anyone right now is online”, etc.
There is a website, where you can pick a country and you’ll get a list of startups. I contacted companies from 5-15 countries. Noone was interested and give me a really fat project.
Because it’s hard to manage outsource and scary.

This is why i’m building my own startup. Where I can use my skills without convincing any new client that I’m really experienced.

Hi Niko!

Yes, it’s a good choice to find a reliable outsourcing company. It’s much more effective to have one coordinated team of developers for your desktop, web, and mobile applications.

First of all, it would be great to do a proper research to find your future partner. Do NOT make a decision based on a prompt Google search. Instead you should:

  • check feedback and reviews, portfolio and expertise of the company;
  • ask about their individual approach to each client;
  • choose the IT service provider based on the domain of expertise (ideally);
  • be ready to discuss all details (it’s better for you to be sure that you understand each other properly);
  • choose an optimal model of cooperation/pricing scheme

It’s the best guide for a good start with an outsourcing partner.

Let’s make it clear. If you have more money than your outsourcing provider expect - i.e. your project generates good margins - all will be work fine or OK.
But if your budget giving less amount of margin - you in trouble.

@iryna I not agree. I mean a lot of your points can be “faked”(strong word - I’m not assuming that anyone can be a scammer). We can use another word - underestimation, overexcitement.

  • Feedback/Reviews - Ok, this company did it well before. But are you sure they will fit in your particular case? I.e. - when you go to the restaurant - you expect fresh food for yourself. Not to know that someone else has a great meal before.

  • Expertise - debatable

  • Individual approach It depends only on budget. And “individual approach” is so flexible term

  • Based on the domain of expertise. Usually, a client - you need an outsourcer for one reason - you want to spend less money than your local service provider will ask. And outsourcing have a few levels, that separated by glass. You cannot jump between glasses - and you’ll always get a different type of service. Yep, domain value is perfect. But it’s not a common thing. Can elaborate more if you want.

  • Be ready to discuss all details I’ll change to be ready to spend money on creating extended software documentation. And only after that documentation people will be able to give you a preliminary-near-real-life estimate. In most cases - clients don’t want to do it.

  • choose an optimal model of cooperation/pricing scheme - don’t get me wrong - but it’s just fancy words.

If your project costs X to create and you paying X+20%(default ok margin) you’ll get a basic service.
if you have X+30% you have less risks. At least you can spend part of that money at documentation.
Example: Hot-dog from street

if you have X+50% that is similar to find gold - you’ll have more people that will “please you”. Like managers, etc.
Example: McDonald’s vs restaurant.

if you be able to pay X+100%/200% or get a recurring flow of work - you became a “shark project”. Most companies spend 20% on shark projects, giving them 50-60% of margins. other time they just balancing with less important projects. And it bad if you get into the category where your project is not important. all depend on the current company situation because this business is hard.
Example: personal chef.