1 – The major advantages are”

Relinquishment of control -The software is developed by individuals who are not employees of the organization,and thus it is difficult to oversee the development process. The contractingorganization cannot direct the employees of the other organization, nor have controlover the many day-to-day decisions that are made in developing software.

Loss of control over reallocation of resources -If work needs to be done to correct problems and/or speed up development, thecontractor cannot take workers off one project and assign them to another project.

2 – The major disadvantages are:

Cultural differences -There may be a significant difference in the culture and values between the contractorand the offshore organization.

Communication barriers -The language of the offshore organization may be different or difficult to comprehendwhich causes difficulty in communicating the needs and desires of the contractor.