6 Essential Metrics for Managing Software Engineering Contractors

Engineering contractors can provide key skills and capacity to supplement your in-house team. According to Bain, outsourcing and offshoring are taking on an unprecedented proportion of work once done in-house, with 60% of engineering executives planning to increase engineering and R&D outsourcing over the next three years.

However, effectively managing contractors and holding them accountable comes with its challenges, including laggy, asynchronous communication, language and cultural barriers, and the use of different tools and methodologies.

All this is to say, that getting on the same page and establishing smooth workflows takes intention and the right management strategies. Ensuring the contractor’s productivity is in line with expectations, justifies the expense, and is comparable to that of in-house teams or other vendors requires additional effort.

Here are six essential metrics that any engineering manager can use to get the most value out of contractors:

#1 Track Time Spent

Monitor the hours worked by each contractor to ensure they are meeting target hours per month. Quickly identify any contractors lagging and address it.

#2 Monitor Tasks Completed

Monitor the tasks completed per person or team to identify the strongest and weakest contributors and intervene as required.

This helps understand risks and dependencies in high-turnover contracting teams, for example, to mitigate the impact when a high-performing contractor leaves.

Understand contribution over time to mitigate risk in high-turnover contracting teams

#3 Monitor Cycle Time by Phase

Set an alert on items in the same status or stage for over three days.

Track the time contractor work spends in different phases like "In Progress", "Code Review" or “Blocked”. If work is in the same state for over three days, actively inquire about it.

Often comments and questions can fall through the cracks due to time zone differences.

Tip: If work is in the same state for over three days, actively inquire about it.

#4 Track Active vs. Waiting Times

Break down cycle times to compare time spent in active vs. waiting states to ensure contractors have what they need to progress efficiently.

If wait times are increasing at the expense of active work, step in to resolve the issue.

#5 Compare Work Types and Sizes

Classify work as tasks, subtasks, or projects. Analyze patterns in the types of work being done.

Ensure the backlog mix aligns with priorities, and also look at PR size over time to ensure you’re emphasizing small fast increments over large slow pull requests.

#6 Conduct Regular Reviews

Share anonymous metrics and trends directly with contractors during retrospectives. Keep everyone aware of goals and expectations.

Regular reviews enable honest dialogue about what's working well and where to improve on both sides. Data insights make the meetings more productive.

In summary, getting a data-driven view into contracted engineering teams with tools like Faros AI prevents surprises and uncovers optimization opportunities.

Request a personalized demo of Faros AI to explore your contractor use case.