Niyamath Parveez

Although outsourcing is an absolutely fantastic tool that can bring so much benefit to a company, it can also have some down points. The fact that majority of the work is going to be out-with the control or study of your firm for large periods of time can cause problems. Who knows what is going on in certain levels of production and it may be that the standards that your firm would hope for are not being maintained. There are obviously going to be contractual elements and considerations which will hopefully take these issues into account but that may not be enough to prevent great damage or loss of face to your firm.

One firm that knows all about this situation is Microsoft Corp, who have been embarrassed on a number of occasions. The company has a very profile and have also been keen users of outsourcing in order to make the best of their time and money. Usually, it has gone very well and the outsourcing for all parties has brought a great deal of success to Microsoft. However, there have been occasions when it has not gone well and as Microsoft have a huge brand image, any mistake is shown up all around the world. This causes a great deal of discomfort and can affect the share price. There are certain things that a firm will always work hard to not damage and the share price is one of them.

The first insight into all not being well with Microsoft came when there was a problem with a Windows 7 USB/DVD Download Tool. It turns that part of the tool had elements of an open source licence in it. The use of this work violated the terms and conditions of the licence. It was placed into the finished product by an outsourcing firm, which means that Microsoft weren’t really responsible for what happened. However, Microsoft are ultimately responsible and the company has been left embarrassed by it, with Peter Galli saying;

"While we had contracted with a third party to create the tool, we share responsibility as we did not catch it as part of our code review process."

Galli is the open source community manager at the Platform Strategy Group within the company.

To have it happen once is embarrassing, twice, it becomes a major issue. This is exactly what has happened to Microsoft and this time it revolves around Juku. Juku was released in China and it an application very much like Twitter. The problem with Juku is that it featured an awful lot of code taken directly from Plurk, a software startup program. Plurk were naturally unhappy with this and made a complaint about the lifting of “code, design and UI elements” of their product.

Microsoft were once again quick to apologise and once again, quick to lay the blame on an outsourcing firm.

"We are obviously very disappointed, but we assume responsibility for this situation. We apologize to Plurk and we will be reaching out to them directly to explain what happened and the steps we have taken to resolve the situation.
In the wake of this incident, Microsoft and our MSN China joint venture will be taking a look at our practices around applications code provided by third-party vendors."