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In order to analyze the success/failure factors in offshore software development service by the structural equation modeling, this paper proposes to follow two approaches together; domain knowledge based heuristic analysis and factor analysis based rational analysis. The former works for generating and verifying of hypothesis to find factors and causalities. The latter works for verifying factors introduced by theory to build the model without heuristics. Following the proposed combined approaches for the responses from skilled project managers of the questionnaire, this paper found that the vendor property has high causality for the success compared to software property and project property.

Critical Factors Analysis for Offshore Software Development Success by Structural Equation Modeling