Software development and consulting are services and providers of services should be evaluated in that respect. Despite offering something completely different to clients / consumers, service providers are usually evaluated the same way providers of products are. Believe it or not, most people are unsure what makes a good service provider and thus have a difficult time picking a good provider. Most people make the mistake of seeing a nice website coupled with low cost and believe they have found a good service provider.

People are very capable of evaluating products because its something you do unconsciously everyday. Products are tangible objects that one can evaluate with their senses. You can taste a soda, see how nice a car looks, smell freshly cooked food, hear music, or even touch fabrics to see if these are what’s right for you.

Services on the other hand are what are considered intangible objects in that you can’t smell, see, taste, hear or even touch them. People evaluate services just as much as they do products but its more difficult because the attributes are based on intangibles. Examples of such intangibles are “how did the service provider make me feel” or “do they listen and understand my problem” and more importantly, “was the service provider in question able to provide me with what I was looking for?”

IT services are core to any successful business today. It becomes much more critical to a business when picking the right software service provider. In today’s world where so many options exist, small or large company – freelancers or firms – offshore or local – consulting and development – etc, it is paramount to understand how to evaluate service providers in their respective fields.

Knowledge is your best tool when choosing a provider. Below we’ve compiled what someone should look for in service providers when selecting one that fits their needs. While most seem like common sense as you read them, you’d be surprised to know most people we speak with didn’t take these matters into consideration when selecting a software service provider.

Privacy
In a world where everything can be shared at the click of a mouse, privacy is more important than ever. Signing a non-disclosure agreement (NDA) is common place in today’s market and don’t be afraid to ask, or even better, demand a service provider sign a privacy document before divulging any of your trade or company secrets.

Consulting Services
Consulting is often misinterpreted. Most individual’s and businesses think it’s only important for products or when something goes wrong which is a misconception. Consulting is for anyone, whether for business or personal use, who want advice from a professional in whatever subject it is they seek the advice from.

When it comes to software, remember the purpose of software in a business… a tool to help promote, expedite, add value, or even provide a venue for your business. Proper business and marketing consultants should know how to help you better your business through the software, not how to make it work on a computer or fix it; Engineers and developers are better at giving technical advice about software. Check the consultant in questions credentials’… remember, it’s your money and you have a right to know what you’re spending it on.

Documentation *
There are very few software vendors who are very good in documenting. Documentation includes comments on source code, any design documents, status reports to you etc… Most clients ignore this aspect and suffer down the road when updating the code. Even a minute change could take several days/weeks without proper documentation. Documentation is very critical to any software; big or small. Bigger the project is; more critical it becomes. Make sure, your software vendor provides formal and standard documents. Ask them for samples.

References
This is the best way to see what others are saying about a particular software vendor. Ask providers for references and find out how they performed first hand from another person who was once in your shoes.

Experience and Portfolio *
Ask your provider about past works they’ve done. Check and verify their portfolio for any work similar to what you’re looking to have done. It saves a lot of time and cost if the provider has knowledge in the domain in question.

Communication
Asking the right questions, understanding your requirements and communicating the issues and progress correctly is just as important as actual development of the software. Ask a provider how they plan on updating you regarding progress and how / when you can contact them. One of the biggest complaints we’ve heard from people working with another service provider prior is lack of communication and the inability to get a hold of them in a reasonable time frame.

Realistic Estimate * * *
When the provider provides you with an estimate, make sure it’s a realistic one. For that it’s very important to have a feeling of how much it may take and compare the same with market value/other bidders. Few vendors charge very high, but most vendors charge an unrealistic low price. They often do that to get your first attention. You start the project enticed by low price, but what you get as the product is not even close to what you imagined. Then often, you pay someone else again to redo it from scratch, hence losing valuable time and money.

So ask for a realistic estimate and make sure the estimate is a competitive but realistic one.

Location
Don’t be afraid to ask where a provider’s headquarters is located. Even if a company is global, it’s important to know the legal providence they reside in, the time zone(s) they operate in, and more importantly, a way to verify who they are. It’s not uncommon for companies today to have their headquarters and development centers in different locations. Big company’s like Microsoft and IBM have been doing it for many years now.

Maintenance * *
This is probably the least important thing on a persons mind when selecting a provider and proves to be the single most important thing when a project is done. Ask a provider how long they’ve been in business, how many people work for them, are they legally registered as a business, etc. No one can guarantee that a company will be around to provide you with maintenance forever but at least have the knowledge of knowing their intentions so you can gauge for yourself their reliability and staying power. Bigger companies are more likely to stay around than smaller ones as they have more invested and it’s more difficult to just up and quite with a healthy number of employee’s working for them.

Payment Schedules
When determining what a fair payment schedule with a provider is, remember you are paying for a service and not a product. If you pay a majority of the total payment up front, there is no guarantee that a provider will not back out of a project leaving you empty handed and worse, having to pursue them in a legal capacity if they didn’t do a reasonable amount of work for what you paid.

Service providers should offer a flexible payment plan that requires compensation equal to the amount of work done.

The management team
A company is lead and run by its management team. The management team not only defines the people and its purpose, but what the company’s moral philosophies are. Take a look at the credentials of the management team and see if they sound reliable.

Diversity of skill set * *
Most software applications (online or PC) demand expertise in several different technologies, i.e., programming language, database, GUI design, scripting, graphics etc…. Know what skill set your project demands and find out if your provider has expertise in all those fields.

Questions to ask

	Can I get your references?
	Have you done similar work before?
	What skill set, education or experience you have as related to my project?
	Explain me how you are going to do it (Submit any design/technical implementation ideas)
	How much time and money it will cost? Give a realistic estimate.
	Where are you located?
	When, how and who can I contact for project updates and status?
	Are you going to maintain my product after you finish developing? What are the costs for the same?
	How do you ensure the quality of the product?
	Why should we select you, not other bidders?