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IT Outsourcing Contract is perhaps the last thing one has to consider when it comes to the implementation of IT Outsourcing in their company. People often think of the cost reduction and the quality of delivery as their priorities, but little do they acknowledge that IT Outsourcing Contract plays a very important role in how these turn out.

In our last article on the IT Outsourcing model, you knew that IT Outsourcing is a multifaceted service, meaning that to finalize an optimal solution for your business, one needs to research many features, including the locations and the pricing contract.

In this article, we will continue with the details of the four most popular IT Outsourcing contracts and the must-have components that you would need in any contract.

You might want to know: Choosing IT Outsourcing Provider for your business

What is an IT Outsourcing Contract?

If you are new to all these IT Outsourcing and Outsourcing contracts, let’s just start with the basic definitions.

An IT Outsourcing contract is a legal document binding two parties in accordance with the agreed terms. In this contract, many components concerning the pricing model, the scope of work, delivery time, etc.

The two parties involved in this IT Outsourcing Contract are the vendor and the client. This contract will probably include the legal terms regarding the intellectual property, non-disclosure agreement and so on.

What are the three types of IT Outsourcing contract?

IT Outsourcing has been favored by many business leaders, thanks to many of its advantages of vendor expertise, improved quality of delivery, cost reduction, etc. But to acquire all of these, it might not be easy as you think it is.

For different kinds of projects, you would have a different approach to best achieve your goal. The same situation applies to the IT Outsourcing contract. There are three types of IT Outsourcing contracts, and they are:

• Project-based
• Time & Material
• Dedicated Team

Project-based IT Outsourcing contract

– What is it:

Project-based IT Outsourcing contract is one of the most popular kinds of contract there is. With project-based, the first and foremost thing that the client needs to clarify before rushing in finding any suitable vendor is their requirements.

The requirements must be clearly mentioned beforehand in the request for proposal. You need to answer these questions:

• What service do you want from the vendor?
• What are the expected goals from the vendor?
• What is the scope of work?

For clients who want to have full control of your spending on IT Outsourcing, the project-based contract is the answer for you. With this kind of contract, the vendor will work under specific requirements and goals. Any work that is unrelated and outside of the work scope will not be taken care of. The product will be delivered within the committed time, with a decided-upon cost.

– When should you use it:

• You know exactly what you want and how you want it from the vendor.
• The project has a small time frame.
• Requirements are clarified and no flexibility is needed.
• The project is straightforward and its directory is not affected by any cause.
• You don’t want to meddle in how the vendor does the project, as long as they can deliver the expected outcome in accordance with the initial requirements.

Time & Material IT Outsourcing contract

– What is it:

Opposite to what a Project-based IT Outsourcing contract offers, Time & Material is the IT Outsourcing contract that is based on the working hours and the resources spent on the project.

Normally, Time & Material is used when the software development project is a long-term one and an estimate of the time required or costs cannot be made in advance. Even though you might start the IT project with some sort of planning, but the outsourcing cost will never be as you expect.

Time & Material IT Outsourcing contract is perhaps the most popular type of outsourcing contract. The main reason for this is that the technology world is moving at an unprecedented pace. The trending technology today might become obsolete the very next day, and the businesses’ operations revolve around the customer experience. It is the customer that decides one’s success. Client centricity is now of the utmost importance, and the client’s demand can change over time.

Especially for tech companies to survive in such a competitive market, they have to change according to the market’s demand. Under this circumstance, a Time & Material IT outsourcing contract is the best solution. With Time & Material, you don’t have to set your eyes on any particular goal, you want to figure out your desired output later, and pivot right when you feel like it.

This adds up the element of flexibility and makes it seamless to complete projects that require a long time. Time & Material contract will continue as long as the client wants to.

– When should you use it:

• Your domain/field is predicted to change in the years coming, and you need the flexibility to adjust along the way.
• Your project is complex with the raw concept, requiring you to spend a lot of time on it.
• There might be emerging technologies that might come in the way.
• When your concept and idea are too innovative to make and advance estimations.
• When you still want control over your project while having an external team work on it

Dedicated team IT Outsourcing contract

– What is it?

A dedicated team is a team of tech engineers that will work on nothing else but your project. With this IT Outsourcing contract, the client would hire with the help of the vendor. Basically, the vendor will provide a talent pool of the most suitable personnel, and the client will do interviews, tests, etc. to select the team member for their project.

With a Dedicated team IT Outsourcing model, development tasks and the outsourcing contract should have clear specifications on any type of goals or details in advance. The dedicated will function as an in-house team, just that they might be located on a different site. The tech workers now are basically your employees, and you can assign them whatever task you want it to.

You can choose various engagement models to build and collaborate with the team so that the communication is smooth and clear.

– When you should use it?

• When you want total control of the human resources.
• When your project is complex and requires constant iteration and modifications.
• When you want to build a long-term connection and relationship with your outsourced team.
• When you are planning to expand and need an expert team of developers working solely for your project

The 3 IT Outsourcing contracts as above can be adjusted as your request. Remember that there is no exact contract that can suit your company right away. Before deciding on how your contract will be, you should negotiate with the vendors. Then create a skeleton contract of the must-have components such as:

• Detailed project scope
• Service level agreements
• Transfer of assets
• Warranty of the product
• Ownership of the product
• IP protection
• Cost & payment structure
• Dispute resolution
• Subcontracting
• Indemnification
• Exit strategy

Once you have included these terms in your contract, you basically don’t have to add anything else. If yes, perhaps just some other minor negotiations.

When you are done with negotiations, you will produce the first draft for post-reading, or the vendor will prepare this for you. Either way, the IT Outsourcing contract should include minute detail to avoid any misunderstanding.

In Conclusion

Each IT Outsourcing contract has its own features, and is only suitable for particular objectives and approaches. Drafting out a contract might be the last thing you think of when outsourcing your IT operations, but it can have major impact on how your team and your whole operation will turn out. A contract is the legal binding between the clients and the vendors, and you need to be very careful when deciding on what contracts you would apply.

Project-based	Time & Material	Dedicated Team
•   Tailor-made for small to mid-size projects •   Entails fixed budget and solid requirements	•   Focused on value and productivity •   Designed for long-term, frequent, scheduled, or day-to-day functions	•   Designed for large-scale projects •   Prepares dedicated team for management and operation
•   Predefined project requirements •   Short time frame •   Fixed budget	•   Complicated and not predefined requirements •   Periodic order •   Need for flexibility	•   Companies that want long-term operation •   Full control of team members •   Flexible transfer

Already know what contract is for you? Get to know How Managing IT Outsourcing works with a detailed guide from Lotus experts.

About Lotus QA

At Lotus QA, we have a flexible approach for our clients to get the most suited IT Outsourcing contract. As each of the contracts has its own traits and features, Lotus QA can customize them upon requests, as long as it can help our clients successfully achieve their final goal. Flexible as it is, Lotus QA still complies with international processes and standard in how we provide you with out technology services.

Have you decided what IT Outsourcing contract to follow? If you are still unclear, contact Lotus QA for further support on this matter:

• Website: https://www.lotus-qa.com/
• Tel: (+84) 24-6660-7474
• Fanpage: https://www.facebook.com/LotusQualityAssurance

IT is among the top 4 outsourcing industries by Deloitte 2021 Global Survey. Business owners choose IT outsourcing services to handle new technologies and functions without spending a lot on training or hiring. Still, many IT outsourcing working models that meet different criteria may confuse you with choosing the most suitable outsourcing model for your business. 

In this article, let’s dig deeper into the most common types of IT Outsourcing based on how you pay and involve with the process, their pros and cons, and what to consider to choose the right IT outsourcing working model for your company.

1. Quick Review On IT Outsourcing Models

Three IT Outsourcing Types

• Onshoring – Domestic vendors.
• Nearshoring – Neighboring vendors.
• Offshoring – Overseas vendors.

Four IT Outsourcing Pricing Models

• Project-based – Pay per project.
• Time and material – Pay per time and effort.
• Dedicated team – Pay monthly salary.
• Staff augmentation – Pay monthly salary.

Also read: What to do when choosing an IT outsourcing provider?

2. Types Of IT Outsourcing

The simplest way to categorize the IT Outsourcing models is to divide them by geological locations. Here are 3 major IT outsourcing types widely adopted by IT companies worldwide.

• Onshoring IT outsourcing: You will delegate your IT operations to an outsourced company located in your country. You won’t face language or timezone barriers but you won’t be able to utilize the advantage of geological pricing. Since a major feature why people want to outsource is to reduce cost, onshoring is not the most favorable IT outsourcing model.   
• Nearshoring IT outsourcing: You will outsource your IT services to a partner in a neighboring country, such as a company in Singapore outsourcing their work in software development and software testing to a vendor in Vietnam. This is an ideal solution to achieve cost-effectiveness while maintaining communication in remote work.
• Offshoring IT outsourcing: You will hand over your IT services to an overseas software development company. This is the most popular IT outsourcing model as you have more chances to utilize high-skilled labor at lower prices. Still, it requires more effort to have effective communication with vendors with large timezone barriers. 

Just with these simple definitions of IT outsourcing models, you can easily their pros and cons. Perhaps you have already found a suitable model for your business.

All in all, regarding communication, onshoring is seemingly the most effective, as both parties of vendors and clients share many features, including the language and the time. With onshoring, any feedback and reviews will receive equivalent feedback right away. In case of emergencies, the clients can contact the vendors via phone numbers, which are accessible anywhere, anytime.

However, in terms of cost-cutting, nearshoring and offshoring are favored more. Due to geological pricing, one can save up to 90% of the overall cost when working with nearshoring and offshoring vendors.

People often say that the price comes with quality, but in the case of nearshoring and offshoring, you can get the equivalent high-quality work at a much more reasonable price. Perhaps the only obstacle here is how to communicate effectively.

The reason why people prefer offshoring and nearshoring IT outsourcing models is that they prioritize cost-effectiveness more than anything. If your utmost priority is to reduce the cost to the lowest, you can consider an offshore development center in Vietnam.

 

3. The four IT outsourcing pricing models

With IT outsourcing pricing models, you will know the basics of how you can run your outsourcing projects and what models fit your financial situations and plan the most. You should look into these IT outsourcing pricing models before signing any contract with an international technology outsourcing company. By knowing how you are going to collaborate, you will have better plans for streamlining your visions and your goals.

Project-based IT outsourcing model

The project-based IT outsourcing model means delegating the entire process to a third-party IT firm. The projects have crystal-clear requirements of what the outputs are. Tailor-made for projects with fixed budgets, project-based outsourcing model is the most suitable when you already know what to expect from this project.

Project-based models work with an individual project, and these projects, quite often, are short-term. Operating in such a short time frame, project-based IT outsourcing model is suitable for businesses looking for vendors to work for new features of a project, or something that has a predefined goal.

 

In regards to the financial matter, you will have to pay a fixed amount of money for what you want. Knowing how much you have to pay for the work, you can have better control of your budget and spending plan.
But what if you want something out of the original work scope? Project-based works if you are following the waterfall method but not the agile method.

To conclude, the project-based model is for clients who know exactly what they want and how they want it. To come up with this final information, business might have to go through multiple steps of business analysis and market research. With the firm information on what the market needs and predefined routes, project-based is the best IT outsourcing model.

Pros:

• Fixed-budget.
• Minimal engagement and management efforts required.
• Clients take minimal responsibility for failures and risks.

Cons:

• You will lack flexibility and be hard to change any aspects if the market changes. 
• Your company and your IT team won’t get much experience in handling and managing these kinds of projects.

Suitable for:

• One-time projects and short-term projects.
• Small-size or mid-size projects.
• Predefined projects.
• Projects with stable market conditions and customers’ needs.

Time & Material IT outsourcing model

In Time & Material (or T&M), you pay for the hourly wage and material costs of your project. While project-based is a pay-upfront model, in Time and Material, you pay for what you get from the vendors. Time & Material contract is another popular IT Outsourcing model that is being applied in many companies and projects in the world.

The T&M is one of the most common models of IT outsourcing if you prefer an agile method. The business company can adjust the process on the way according to the market changes or customers’ reviews. Hence, this is the best IT outsourcing model if you are on a long-term project without precise requirements, a fixed timeline and some aspects may be subject to change.

 

 

Time & Material is the opposite of what a project-based outsourcing model can offer you. With T&M, you focus on the value and productivity of the whole process. Time & Material are deemed the viable solution for businesses that are working on complicated and not predefined requirements. However, there are periodic orders and frequent schedules.

Usually, Time & material contract model often goes with businesses working in rather new fields of the IT world. New markets and new experiences require changes by the minute, and only Time and Material can offer the flexibility that you need to thrive in a new sector.

Pros:

• Cost transparency and worthy.
• Lots of flexibility to handle changes and create user-approved products.
• Best for new technologies or changeable fields in the IT industry that are hard to predict.

Cons:

• Difficulty in tracking time and materials costs.
• Overboard the expected budget if initial estimates go wrong.
• Resource-consuming to work with your vendor.

Suitable for:

• Long-term projects.
• Agile, flexibility-preferred projects.
• Projects with unclear paths or requirements.

Dedicated Team IT outsourcing contract

A dedicated team has a similar way of operation as Time and Material, but the difference lies in how the recruitment goes. Normally, for project-based and T&M projects, the clients only clarify the outputs of the project. The matter of who does it and their skillsets is minor in their focus.

The team-based model is when you deeply care about who does the task and their skills. Your IT outsourcing partner will suggest a pool of engineers alongside their talents and you will choose specific specialists to form a team.

In terms of payment, the pricing system is quite transparent, the clients will pay monthly in accordance with the team size. The pay includes members’ salaries, service providers’ fees and any other additional fees that have been agreed upon before.

The scope of a dedicated team is quite big, and they will work on projects that are not strictly predefined, with requirements that can change over time. Since they are technically vendor’s employees, the vendors can give them multiple tasks of multiple projects. This feature can be further addressed in the contract between the vendors and the clients.

Pros:

• Your outsource team can work as your in-house IT team.
• Lots of flexibility during the development process to handle changes.
• You’re able to choose the best specialists for your projects.
• You’re in control of the project development process.

Cons:

• You need to understand the project’s field to choose the right engineers with the right skills.
• Resource-consuming to manage the outsourced team.

Suitable for:

• High-standard projects.
• Flexibility-preferred projects.

Staff Augmentation

Staff Augmentation is a dedicated team but in a smaller scope. Staff augmentation is basically hiring tech engineers from vendors and having them work as your full-time employees. Payments for staff augmentation are the same as in dedicated team IT outsourcing models, meaning that the staff should be paid monthly.

The highest risk of staff augmentation is that the employees working for you might not want to work for that project anymore, you might have to do the hiring process again, including the onboarding and training phase. The sustainability plan for staff augmentation is not very ideal. But for a short-term and mid-length project, staff augmentation is the perfect answer, even better if you are only looking for one or two employees.

 

Pros:

• Easy to scale up and down the team according to business changes.
• Cost-effective as you don’t need to hire a big team.
• Your IT team may learn some skills from outsourced engineers.

Cons:

• Resource-consuming to onboard and manage outsourced professionals.
• Conflicts and communication gaps may be created when merging outsourced professionals with your in-house team.

Suitable for:

• Short-team and mid-length projects.
• New or advanced skills and technologies.

4. How to choose the most suitable IT outsourcing models

Now you understand different types of IT outsourcing working models. The next step should be understanding your needs and circumstances, right? 

There are a lot of factors to consider to find out the suitable IT outsourcing model that fits your business. Consider the following factors:

• The goal of your project, whether it is clear or still in the fog.
• The frequency of the project: Is this project one-time or repeatedly?
• The scope of your project. From the goals of the whole project, you can estimate how much labor will it cost you to complete the goal.
• Your preferred project management methodology. For example, if you want to follow the Agile or Scrum methodology, project-based is definitely not your ideal way to go.
• How do you expect the scalability from your outsourcing team?
• What technical skills and level of experience do you expect from your team members.

5. On the final note

Now you know all the IT outsourcing working models, their pros and cons, and your requirements. Simply go to any vendors and discuss your “order” to find the best team to work for you.

With an IT outsourcing model in your mind, you can determine how you can manage your team and how to allocate budgets during your project. The aforementioned models all have their pros and cons, and their use is just for some particular kinds of projects. One must know how they want the project to be carried out and the expected output (or at least what trajectory they are trying to pursue) of the outsourcing process to effectively work with vendors. If the requirements are not clear enough or the feelings of urgency make them rush into hasty decisions, they might fall into many outsourcing pitfalls instead of cutting costs and improving competencies.

About Lotus QA

At Lotus QA, we have a flexible approach for our clients to get the most suited IT Outsourcing model. As each of the models has its own traits and features, Lotus QA can customize them upon request, as long as it can help our clients successfully achieve their final goal. Flexible as it is, Lotus QA still complies with international processes and standards in how we provide you with our technology services.

Struggling with finding the best engagement model for you? Get free consultancy from our experts of Lotus QA. We will give you 24/7 support to find the perfect solution for you. Contact us:

• Website: https://www.lotus-qa.com/
• Tel: (+84) 24-6660-7474
• Fanpage: https://www.facebook.com/LotusQualityAssurance

 

The matter of Data Labeling Quality has been a major topic of concern in AI/ML communities. Perhaps the most common “principle” that you might come across solving this puzzle is “Garbage in, garbage out”.

By saying this, we want to emphasize the fundamental law with training data for artificial intelligence and machine learning development projects. Poor-quality training datasets fed to the AI/ML model can lead to numerous errors in operation.

For example, training data for autonomous vehicles is the deciding factor for whether the vehicles can function on the roads. Provided with poor-quality training data, the AI model can easily mistake humans for an object or the other way round. Either way, the poor training datasets can result in high risks of accidents, which is the last thing that autonomous vehicle manufacturers would want in their projects.

For high-quality training data, we need to involve data labeling quality assurance in the data processing procedure. At Lotus Group and Lotus QA, we take the three following actions to ensure high-quality training datasets. Take a look at this fundamental guide to provide your AI/ML model with the best training data.

Don’t know where to start in AI data processing? Check out our Data Annotation Guide.

 

1. Clarify requirements to optimize data labeling quality

The precision of annotations

High data labeling quality doesn’t simply mean the most carefully annotated data or the training data of the highest quality. For strategic data annotation projects, we need to clarify the requirements of the training datasets. The questions that annotation team leaders should answer are how high-quality the data needs to be, the acceptable precision of data annotation, and how detailed the output should be.

As a vendor of data annotation quality, one thing that we always ask our clients is the requirements. “How tedious do you want us to work with the datasets?”, “How would you want the precision of our annotations?”. By answering these questions, you will have ahead of you a benchmark for your entire projects later on.

 

 

Skillful levels of the annotators

Keep in mind that the implementations of Artificial Intelligence and Machine Learning are very broad. Besides the common applications in autonomous vehicles and transportation, AI and ML made their debut in healthcare and medical, agriculture, fashion, etc. For each and every industry, there are hundreds of different projects, working on different kinds of objects, hence different skills and knowledge are required to ensure data annotation quality.

Take road annotation vs. medical data annotation for example.

• For roads annotation, the work is quite straightforward, and you only need annotators who are capable of common knowledge to do the work. For this annotation project, the number of datasets that need annotating can add up to millions of videos or pictures, and the annotators have to keep the productivity high in an acceptable level of quality.
• Medical data requires annotators who work in the medical field with particular knowledge. For the case of diabetic retinopathy, trained doctors are asked to grade the severity of diabetic retinopathy from photographs so that deep learning can be applied in this particular field.

 

 

Even for well-trained doctors, not all of their annotations agree with one another. To have a consistent outcome, one annotation team might have to annotate each file multiple times to eventually come to a correlation.

It is a matter of how complicated the given data is and how detailed the clients want the data output to be. Once these things are clarified, the team leader can work on the allocation of resources for the required outcomes. Metrics and the relevant Quality Assurance process will be defined after this.

Example of an ideal output

We also encourage the clients to provide example sets to act as the “benchmark” for every dataset to be annotated. This is the most straightforward technique for the quality assurance of data annotation that one might employ. With the example of the perfectly annotated data, your annotators now are trained and presented to the baseline of their work.

With the benchmark as the ideal outcome, you can calculate agreement metrics to evaluate each annotator’s accuracy and performance. In case of uncertainty in both the annotation and review process, the QA staff can work with these sample datasets to define which are qualified and which are not.

 

2. Multi-layered QA process

The QA process in data labeling projects varies within different companies. At LQA, we adhere to the international standardized quality assurance process. The predetermined preferences will always be clarified right at the beginning of the project. These preferences will be compiled into one “benchmark” which will, later on, act as the “golden standard” of every label and annotation.

The steps of this multi-layered QA process are: Self-check, Cross-check, and Manager-check.

 

Self-check

In this step, annotators are asked to do the review on their own work. With self-assessment, annotators now have the time to look back at the data annotation tool, annotation, and labeling from the start of the project.

Normally, annotators have to work under great pressure in terms of time and workload, which can possibly lead to potential deviations in their work. The quality assurance starting with the self-check step will be the time for annotators to slow down and take a thorough look at how they’ve done. By acknowledging the mistakes and possible deviations, annotators can fix them themselves and avoid any of those in the future.

 

 

Cross-check

In data science in general and data annotation in particular, you might have heard about the term “bias”. Annotation bias refers to the situation in which annotators have their own habit to label the data, which can lead to biased opinions upon the provided data. In some cases, annotator bias can influence the model performance. For a more robust AI and ML model, we have to take some effective measures to eliminate the biased annotations, and one simple way to do this is to cross-check.

 

 

By carrying out cross-checking in your annotation process, the whole work is viewed differently, hence the annotators can identify the mistakes and errors in their colleagues’ work. Again, with this different view, the reviewer can point out the biased annotations and the team leader can take further actions. They can rework or give another round of assessment to see whether the annotations are really biased.

 

Manager’s review

An annotation project manager is usually responsible for the day-to-day oversight of the annotation project. Their main tasks include selecting/managing the workforce and ensuring data quality and consistency.
The manager will be the one that receives the data sampling from clients and work on the required metrics and carries out training for the annotators. Once the cross-checking is done, the manager can randomly check the output to see whether they adhere to the clients’ requirements.

Prior to all these checks, the annotation project manager also has to draw a “benchmark line” for quality assurance. To ensure annotation consistency and accuracy, any work that is under the predefined quality must be reworked.

 

 

 

3. Quality Assurance staff involvement

Data labeling quality control cannot rely only on the annotation team. In fact, the involvement of professional and experienced quality assurance staff is a must. To ensure the highest quality of your annotation work, a team of quality assurance staff is a must. They will work as an independent department, outside of the annotation team, and not under the management of the annotation project manager.

The ideal percentage of quality staff over the entire number of data annotation staff doesn’t go beyond 10%. The QA staff cannot and will not review every single annotated data in your project. In fact, they will randomly take out datasets and once again, review the annotations.

 

 

These QA staffs are well-trained with the data sample and will have their metrics to evaluate the quality of the annotated data. These metrics must be agreed upon between the QA team leader and the annotation project manager beforehand.

In addition to the three-step of review of self-check, cross-check and manager’s review, the involvement of QA staff in your annotation projects will sure adhere your data output to the predefined benchmark, which eventually ensures the highest level possible for your training data.

Want to hear more from professionals to enhance your data labeling quality? Contact LQA for more information:

• Website: https://www.lotus-qa.com/
• Tel: (+84) 24-6660-7474
• Fanpage: https://www.facebook.com/LotusQualityAssurance

Founded on October the 18th, 2016, Lotus Group sets the vision for becoming one of the top IT service providers working with domestic and international clients. Throughout the last five years, Lotus Group has always pursued the mission of elevating and connecting Vietnamese IT engineers to international clients, hence contributing to affirming Vietnam’s position on the world’s technology map.

Our journey started with the foundation of Lotus Quality Assurance, the first independent quality assurance company in Vietnam. Developed by the most talented and experienced QA engineers, Lotus QA has always been one of the key services, making Lotus’ name and position stronger in Vietnam’s IT market.

 

 

Aiming at providing a comprehensive service offering system, Lotus stepped up the game as our BOD expanded the service coverage with Lotus Technology Services in 2017 to bring more value and high-quality work to our customers. With Lotus TS, we specialize in providing data labeling, data annotation and software development outsourcing services.

As we saw the great potential in partnering with Japanese clients, Lotus Group established the Lotus Japan office in October 2020 with the desire to support our clients more quickly despite facing many difficulties amid the Covid-19 pandemic.

Motivated by the desire of bringing Vietnamese IT engineers to the global market, our Board of Directors has been working tirelessly to expand our reach and our resources. The plan for future establishments in major markets including Korea, the US, Singapore has been conceived and is soon to be carried out in the years coming. Lotus Group sets the target of becoming a global IT firm with 1000 headcounts.

 

 

After 5 years of hard work and continuous efforts, Lotus Group has gained many important achievements, affirming our high-quality and top-notch services.

During the past 5 years, Lotus Group has always been a reliable partner with two leading software testing units in Korea and Japan. Simultaneously, Lotus is also an active member of two leading technology associations in Vietnam, namely VINASA and VNITO.

In 2021, Lotus Group was officially recognized as a Silver partner of ISTQB, the most prestigious global software testing certification organization. This certification once again affirms the high-standard quality in our testing services, marking the first milestone in the development of Lotus’s Global Partner. Also in 2021, Lotus was honored to receive the Sao Khue Award of Top AI Data Annotation service providers in Vietnam and was awarded the title of top IT services in Vietnam by Clutch – the world’s leading B2B business listing website.

Our five years of operation are five years of continuous hard work to bring the best quality products and services to our customers. So far, Lotus Group has worked with 221 projects of all sizes, partnered with more than 70 clients from different markets. 94% of our clients are satisfied with the service quality from Lotus. The two important indicators contributing to such high satisfaction score are the 98% accuracy rate for annotation projects and the 0.02% leakage rate for software testing projects.

 

 

Starting the journey in 2016 with only 12 members, Lotus Group now has 236 employees and still growing in personnel scale with an average growth rate of 45% per year.

The growth in the number of staff not only strengthens Lotus’ prestige and reputation but also contributes to bringing more development opportunities for humans of Lotus.

Alongside the growth in quantity is the growth in quality. In addition to the development of IT-specialized professional skills, we also emphasize the importance of language proficiency. As our biggest clients come from international markets, 85% of our employees can communicate in English, 25% are fluent in Japanese and 5% are fluent in Korean. As we keep the communication effective, we can therefore bring our services to more markets.

The staff at Lotus also constantly strives for improvements by pursuing international professional certifications. As of October 2021, 52% of Testers at Lotus have ISTQB certificate, 10% have ISTQB Advanced certificate, 36% of staff have Scrum Master certificate, 10% of the management team have achieved No.1 international project management PMP.

Lotus always listens to the opinions and contributions of employees and constantly improves to create a desirable working environment. For the company to develop, we connect our staff and form a strong sense of solidarity. The company has successfully organized many Team Building programs, YEP, monthly events and many other extracurricular programs. It can be said that Lotus has been gradually improving in all aspects of organizational structure, quality, personnel and environment.

PV member: 1 word about Lotus

However, there is no bed of roses. To be able to achieve these results, Lotus has also gone through many ups and downs, hardships and challenges. Under the leadership of our BOD, Lotus has constantly overcome difficulties.

On the occasion of Lotus’ 5th birthday, each member of the company has different thoughts and feelings, but they all share the same purpose for strong development in the future.

Going through the first 5-year journey, despite many ups and downs, Lotus is proud to always maintain the spirit of a fighter, always ready to face new challenges. Our journey ahead is sure to be full of difficulties, but Lotus Group believes that with the youth, perseverance and solidarity of all members, all difficulties and challenges will make us more mature and stronger, earning us the title of Amazing Lotus.

Vietnam is amongst the top destinations for AI data processing services, providing top-notch data labeling, data collecting and data annotation work. With many favorable traits that can help businesses reduce costs as much as possible, we now have a whole ecosystem of the top Data Labeling companies in Vietnam.

If you are looking for a reliable AI data processing service provider in Vietnam, you can consider our list of top 10 data annotation companies.

You might want to know: Why is Auto Data Labeling the future?

 

Overview of data labeling companies in Vietnam

The demands for AI data processing services hit a record-high number as the world’s technology is revolving around AI-related technologies. To operate an AI model, one business might need thousands of training datasets. The increasing need for AI development and training data leads to the increasing needs for data collection, data annotation and data validation.

Since the dawn of AI and ML, there have been hundreds of companies founded just to handle data processing services (because the number needed is very high). The most mature market in this particular field is the US and China. However, as these countries move further towards AI development, the cost for operating an AI data processing hub gets higher and higher. In these countries, the workforce once dedicated to AI processing services now switch to other AI-related technologies.

To maintain a reliable and stable source of training datasets, AI development companies have to come to other countries for a better cost, and Vietnam is one of the most reasonably-priced destinations.

In Vietnam, the price for hiring and retaining talents is lower than that of China or the US. We also have a young and abundant workforce that can cover your needs for training data.

Our AI data processing services started to boom 6 years ago. And in only 6 years, a whole new ecosystem of the most prestigious and renowned AI data annotation companies are founded and still operating with great prospects:

• Lotus Quality Assurance
• DIGI-TEXX VIETNAM
• Sibai
• SANEI HYTECHS VIETNAM Co., Ltd.
• BEETSOFT Co., Ltd
• MP.BPO
• Vietnam Smart BPO (VSBPO)
• Kotwel
• OkLabel
• Vie-Partner

 

 

Details about top data labeling companies in Vietnam

Top data labeling companies in Vietnam can provide you with an array of different services to fulfill your needs in AI development and AI data processing.

 

Lotus Quality Assurance

Lotus Quality Assurance, as part of Lotus Group, was founded in 2016 with the start of a Testing and Quality Assurance company. As the company moves towards the newest technologies there are in the market, our BOD has come to the realization that AI data processing service holds great potential and prospects for further development. Indeed, since its foundation, Lotus QA has continuously worked with international clients in different data annotation, data annotation and data validation projects. Besides project-based work, Lotus QA has been a long-term partner of multiple clients, mostly in the automotive sector.

 

 

Especially, our annotators and QA engineers assure high-quality training data and annotated data with an average error rate of only 0.02%, which is very ideal for any annotation project.

Since the foundation of Lotus QA, data annotation has always been the key service offering for our clients. As we thrive in this area, we have been working with many kinds of data, ranging from image, text, voice from different sectors. These sectors are automotive, agriculture, construction, fashion, finance, etc.

 

DIGI-TEXX VIETNAM

DIGI-TEXX is a German IT- BPO company headquartered in Ho Chi Minh City, Vietnam since 2002, with 3 branches in Ho Chi Minh City and one office in Fukuoka, Japan. With 100% FDI from Germany, DIGI- TEXX is one of the pioneers in the Business Processing Outsourcing (BPO) industry in Vietnam. As a digital solution provider with a solid BPO background, we empower clients around the world from various industries to achieve business transformation and gain competitive advantages.

With more than 1000 employees, providing round-the-clock services, they guarantee service delivery excellence while ensuring compliance with industry-followed quality and security standards.

They have been consistently providing Outsourced Services and Digital Solutions for more than 19 years to international clients in various industries, that require:

• Document processing to save time and optimize cost.
• Digital solutions to replace paperwork with automation processes, such as Banking, Insurance, and Healthcare.

Besides, they also provide Customer Helpdesk services in fluent Vietnamese, Chinese, Japanese, and English for many E-commerce and trading platforms.

 

SIBAI VIETNAM

SIBAI VIETNAM was founded in 2020 with a dedicated team of more than 200 experienced annotators who can handle your most unstructured datasets. With competent staff who have worked on multiple projects, SIBAI VIETNAM can now carry out your data annotation project on multiple platforms with different data annotation tool, across all content types.

With the combination of human talents and AI, SIBAI VIETNAM thrives as one of the most successful data labeling companies in Vietnam. Our customers’ most complex labeling needs can be well handled and addressed.

 

 

 

With high-quality data labeling and data annotation services, SIBAI is to elevate your business growth. SIBAI VIETNAM has developed a talent pool of more than 200 well-trained annotators in diverse areas. With all combined, we can provide the most suitable solutions that you are looking for, anytime you need them.

Besides the usual data annotation service, SIBAI VIETNAM also focuses on content moderation solutions. SIBAI provides human-level accuracy that significantly moderates community-generated threats in image, video, text, and audio. SIBAI can help brands limit risk exposure and safeguard their online platforms from content that has been flagged as inappropriate or violating community guidelines.

 

SANEI HYTECHS VIETNAM Co., Ltd.

Established on 19th June 2015, SANEI HYTECHS VIETNAM Co., Ltd. is currently one of the best data labeling companies in Vietnam. With the association with Japanese branches and companies, Sanei has strong resources and a foundation for top-notch services. Their service offering includes:

• Software Development (Embedded software, third-party unit verification, software application on Windows, Android, iOS and Bluetooth, etc.)
• LSI Design (FPGA Design/Verification, Logic Dedsign/Verification), Ip Design/Verification)
• Annotation Center (Create, analyze and provide design/evaluation data toward Big Data processing, deep learning data creation of the Artificial intelligence development, BPO service)

SANEI HYTECHS VIETNAM Co., Ltd. is currently operating with small number of employees but it can stretch in scale if requested.

 

 

 

BEETSOFT Co., Ltd

Beetsoft is another stand-out name among the data labeling companies in Vietnam. With more than 5 years of experience working in IT Consultancy and outsourcing services, Beetsoft knows how to play a stellar role in honing the skills of professionals, assisting companies to achieve success in their operating fields. Based in Vietnam and Japan, Beetsoft focuses on providing services to these two markets. Especially in the data labeling and data annotation fields, Beetsoft stands out as it can provide high-quality projects thanks to international standards and a multi-layered QA system.

Beetsoft offers high-end services at competitive rates as our development and annotator team is based in Vietnam. The competitive price of Beetsoft is always accompanied by the best work there is, so their customers can rest assured of the quality.

 

MP.BPO

BPO.MP Co., Ltd. is the first BPO enterprise with the Vietnam-Japan joint venture model to provide Business Process Outsourcing services, including document digitization, data entry & processing data management, financial and accounting processing, content writing, translation-interpretation, image processing, document labeling, etc.

With the motto “Successful cooperation to overcome limits”, the company’s development goal is to combine the advantages of the two cultures of Vietnam – Japan, take advantage of the strengths of businesses of the two countries to provide the best services. MP.BPO promises to bring services of international quality for customers in Vietnam and around the world.

 

Vietnam Smart BPO (VSBPO)

Vietnam Smart BPO (VSBPO) is a brand under Free’t Planning Vietnam, a joint venture between Vietnam, Free’t Planning Japan and I-Corporation Japan. VSBPO takes pride in being a pioneer in the industry, and a leader in providing business process outsourcing (BPO) services in Vietnam. Their partner, Free’t Planning Japan, has 20+ years of experience in IT & BPO industries. Today, the total number of employees is 200+ across 3 countries (Japan, Vietnam, China).

With the vision of becoming the leading BPO company in Vietnam, VSBPO is to provide the best quality services at optimal cost to clients.

 

Kotwel

Kotwel is the emerging data service provider for artificial intelligence. Relying on its own data resources, technical advantages and rich data processing experience, since its establishment, Kotwel has provided high-quality data services to many technology companies and scientific research institutions worldwide.

 

 

Kotwel is committed to total customer satisfaction by providing consistently high-quality data & services that meet or exceed the expectations of our worldwide customers.

Their purpose remains to embrace the power of human ingenuity and technology to create value for your AI & Business Initiatives. Kotwel wants to enable enterprises globally with stellar quality data services by using the combination of advanced tools and human intelligence. Benefitting and creating an optimistic social change through employment.

By supporting the development of game-changing AI & Technology applications with cutting edge workforce solutions, Kotwel wants to become a global leader when it comes to solving your data needs.

 

Ikorn Solutions

As a leader in contemporary online trends, Ikorn Solutions has grown as a highly respected IT company and become a trusted partner of many large Korean firms since entering the IT outsourcing market in 2007. They specialize in software development and I.T. outsourcing services such as data labeling services that are comprehensive, integrated, and customized to suit individual business needs across industries.

Driven by a passion for technology, Ikorn strongly believes that quality integration and technological development are at the center of their business. Ikorn´s competitive advantages are a force to be proud of as an excellent pool of skilled resources recruited from the finest professional education institutions in the industry. In 2017, following 10 years of operation and great persistence in development, Ikorn Solutions took a consistent and rigorous approach to expand our outsourcing services into the automotive industry and began to seek new partners for the next phase of business. This move served to affirm, step by step, the company’s strong position in the software technology market.

 

Vie-Partner

In 2016, VP Studio was founded by a team of computer graphics artists, providing graphic and 2D/3D designs for movies and games productions.

After observing the similarities of working methods and logic between Computer Graphics and Data Annotation, they found that experienced graphic designers achieve a 30% higher annotation speed and accuracy than average.

With years of experience in graphics training, they founded Vie-Partner specializing in Data Annotation. The goal of Vie-Partner is to provide organizations with trustworthy labeling solutions while creating work chances for underprivileged youngsters in Vietnam, minimalize costs without compromising quality.

 

If you are looking for the high-quality data labeling services in Vietnam, contact Lotus QA for more information from experts:

• Website: https://www.lotus-qa.com/
• Tel: (+84) 24-6660-7474
• Fanpage: https://www.facebook.com/LotusQualityAssurance

At Lotus Quality Assurance, we provide high-quality end-to-end IT services such as software testing, development and quality assurance, and AI data processing. We are passionate about bringing young, talented, and skillful Vietnamese to the Global market by helping clients to improve product quality.

 

Positioned as an independent QA firm, we commit to providing transparent, trusted, and valuable quality reports. We focus on our client’s business goals, and we commit to bringing value by helping our client meet their quality needs at the lowest cost.

 

In our journey of providing the top quality testing service to our clients, we have built a comprehensive working process in compliance with the global standard. For any client that requests customization in how we work, we also support them to find the most effective process.

 

 

With that in mind, we are thrilled to announce that we are highlighted on Clutch as one of Vietnam’s top software testing companies for 2021. For further context, Clutch is a B2B ratings and reviews firm in the heart of Washington, DC, that connects businesses with the best-fit agencies or consultants they need to tackle their next big business challenge. Each month, over half a million buyers and sellers of services use the Clutch platform, and the user base is growing over 50% a year.

 

Every year, Clutch honors the highest-performing B2B companies across industries. The top companies exhibit deep knowledge in their field and a solid commitment to high-quality customer service. We work hard to deliver the absolute best products and working experience to our clients, and we’re thrilled that this hard work has paid off.

 

We are very appreciative of our clients for the continued trust and belief they’ve accorded to us. Their reviews on our Clutch profile prove that we have what it takes to provide top-tier software testing services. Below is a quote from one of the reviews we received.

 

“I can’t think of anything at the moment Lotus Quality Assurance could improve. They’re great people that provide superior service. “ – CTO, Advantages Digital Learning Solutions.

 

Do you have a project in mind? We are your choice for software testing and quality assurance vendor. Contact us today!

 

5 years of remarkable development are 5 years of hard work, and hard work pays off. Through the journey since 2016, Lotus Group and the employees have been working tirelessly to make our name stand out among the IT service providers in the world.

Our top-notch services have been recognized in both domestic and global markets, making our brand closer to international clients. With strategic development plans in the years coming, Lotus Group hopes to bring more significant achievements.

The foundation of LQA was set in 2016 when the market of Quality Assurance, in general, was still in the early stages. With the opportunity of a new and very promising field of the IT market, LQA strived as the first Vietnamese Quality Assurance Company.

With this advantage, LQA continues the journey of becoming a well-trusted Technology Solution Provider. Throughout our 5-year development and 162 projects, LQA has proven its competency and our dedication to the clients’ experience.

We are dedicated to constantly improving our competencies through achievements and certificates in multiple fields. With solid figures proving our experience, you are well-assured of high-quality services and products.

With 5 years of experience and dedication to a dynamic and developing community of Technology Solution providers, LQA has partnered with multiple companies and joined many organizations.

In terms of Process, LQA not only follows stringent procedures of ISO 27000:01 for optimal security and international standardized process but also flexibly adapts to clients’ requirements.

In terms of People: In LQA, we ensure staff competency through strict rounds of interviews, on-job orientations, continuous learning & development. Theoretical knowledge and practical implementations are combined throughout our process.

In terms of Technology: With leading-edge technologies and hands-on experience, LQA adapts to the ever-evolving pace of the market, enhancing the productivity and quality of our services for our clients.

We have different career paths for each position of Business Analysis, Developer, Tester or Project Manager, etc. to develop not only technical skills but also tactical skills.

Contact us:

• Website: https://www.lotus-qa.com/
• Tel: (+84) 24-6660-7474
• Fanpage: https://www.facebook.com/LotusQualityAssurance

The first five-year plan of Lotus Group has reached to an end with many achievements and stories to be told. With the foundation and certain success we had in the past five years, Lotus Group sets higher aims and bigger goals to our next five years to thrive.

 

Our motivation strengthens us

Since day one, Lotus has always envisioned to bring the IT talents of Vietnam to the global market. Seeing the unprecedented potentials of well-trained and professional IT workers that enter the job market every year, our BOD senses that these talents can also make a difference in the international market.

The talent shortage in tech positions is very alarming, and to fill these positions are very costly and time-consuming. Seeing the huge number of tech graduates every year, our BOD sets the vision on how to bring as many talents to the world as possible. From small testing projects, now Lotus QA has got some major succeeds with big clients, working in many fields including AI data processing, testing and development.

The motivation of Lotus has always been bringing Vietnam to international customers. Lotus wants to prove to the world that despite the war-torn history, Vietnam now has the potential and the opportunities to thrive as a technology-fused nation. By taking the potentials of these young and dynamic talents, Lotus strengthens the image of Vietnam and joins hand in making Vietnam the top country for IT services.

 

Broaden our services

 priorities for Lotus in the next five years is the expansion of our services to clients. In 2021, Lotus Group, from a company that focuses on AI data processing and testing services, have started the development service and this has helped Lotus Group gain more reputation in the international market.

With the three major services as mentioned above, Lotus appears as the well-rounded IT service company with capability of providing multiple IT services.

Our BOD aims at broadening our services to reach out to more and more customers, hence expanding Lotus Group. As there will definitely new services in our system, there will be a raise in the number of our employees. In 2021, our team reached 248 personnel, and this number is promised to rise more.

 

Learning and Development

Any company that invests in employee development is investing in their own success. By providing ongoing training for your employees, you are creating a workplace that is adaptive, flexible, and ready for change.

In 2022, Lotus Group plans to bring the essential classes to our employees. We not only help them acquire more knowledge but also give them the chance to improve other important skills such as foreign languages and presentation skills.

Employees increasingly expect informative and applicable training, which satisfies their needs both as workers at your organization and as up-to-date, informed professionals. Delivering on this training is an important step in building a genuine employee experience management strategy.

The next five years of Lotus Group will have a lot of changes, but we stay true to our motivation, and that is to bring the talented and professional IT workers to the world. By expanding our services and providing the essential knowledge for our employees, we are getting closer to successfully achieve this goal.

Amazing Lotus – The journey towards perfection of Lotus Group marks a new milestone as we celebrate our 5th year anniversary this October. Through the ups and downs in our journey, Lotus stands strong as we keep fulfilling the goal of bringing top-notch IT services to international clients.

Join us in these upcoming events of our 5th birthday to see our people and culture:

 

5 Years Rewind – October 11th

5 years of hard work, 5 years of ups and downs, and each member of Lotus Group has their own thoughts to share. This 5 Years Rewind is to remind us of the precious memories and lessons that we have in the past give years, and also to speak up our wants and needs in the future.

 

Lotus Gift Box – October 12th

To make this 5-year anniversary the most memorable events of 2021, Lotus QA wants to give you little gif boxes. No matter you’re working onsite or from home, we will send it to you as a thank-you gift for walking with us in the journey of becoming the top IT firm.

 

Lotus Summit – October 13th

Every idea and every thought of our employees will be heard, no matter how long have you been in Lotus Group. In this Lotus Summit event, BOD of the company will collect people’s thoughts and have solutions and measures accordingly. The revenue and business of the company will also be publicly shared so that the employees know what is going on with the company’s performance.

 

The Lotusian Contest – October 13th

An exciting contest to fire up the mood of our Lotusian. This will sure spark joy for our staff whether they are working from home or onsite.

 

5-Year Anniversary – October 16th

The most anticipated event of the year – 5th year anniversary party is a joyous and exciting occasion for the old and new member get to know each other.

Let’s have the most memorable birthday ever with Lotus Group!

On October 18th, 2021, Lotus QA once again celebrates its 5th anniversary, marking a milestone in the journey of providing top-notch IT services to the world.

With the firm foundation we had built in the past 5 years, from a company focusing on Quality Assurance and AI Data processing, Lotus QA has now broadened our horizons with new services in the Software Development field. This expansion brought excitement, alongside many challenges, creating motivation for us to strive for perfection.

 

The remarkable expansion

As Lotus QA takes pride in the top-notch services we provide to the international market, especially with the quality assurance and AI data processing services. In 2021, our Board of Directors decided to promote activities in the most demanding market – Japan. We’ve been in business with Japanese companies before, and now we want to focus our resources to fully tap the potential of this market.

Therefore, on April the 3rd, 2020, we founded the LJP office which is located in Yamashitacho, Naka Ward, Yokohama, Kanagawa 231-0023, Japan. This foundation has laid the foundation for many of our services to reach more customers in Japan, especially the Software Development services.

Besides this overseas expansion, Lotus QA has remarkably achieved another milestone back in Vietnam. Thanks to the improvements and developments in many aspects of managing and forming a business, Lotus QA is becoming the number one destination for young and enthusiastic IT workers. In Lotus QA, the BOD and team leaders want to create a dynamic, proactive and professional working environment for their employees. From a minor IT company in Hanoi, Lotus QA now has over 248 employees, raised by 20% compared to last year’s number.

 

International recognition

In an attempt to stand out in hundreds of IT service providers in the world, Lotus QA is trying to bring our best service offerings to as many clients as possible, beckoning those in need of high-quality work to come to us. With hard work and continuous improvements, Lotus QA has been recognized in the international market.

In September 2021, Lotus QA was honored to receive the title of Top IT firm in Vietnam. This title is the “Trophy” for what we’ve achieved throughout the last five years, and it also sets many more challenges for us to overcome to live up to the expectations.

 

The challenges to overcome

Despite the Covid 19 pandemic, we have successfully established our first subsidiary in Japan – Lotus Japan (LJP). Choosing the land of the rising sun as our next destination, we aim to deepen our understanding of international clients; while also learning from the strict quality regulations.

Other than amplifying our international presence, LQA also decided to spend more effort on the domestic market. So far, we have worked with leading clients in Vietnam from several fields: telecommunications, F&B, and insurance, etc.

We are trying hard to win in our home country, to be the number one QA firm in Vietnam.

To emphasize our goal, our CEO, Ms. Phung Thanh Xuan indicated: “As we are heading towards the new normal, the time could be the hardest for everyone. However, we are all in this together. We strive to become a world-class Quality Assurance Firm”.

Let’s celebrate this fascinating moment with Lotus Group in the upcoming events to be revealed.