Although initially designed for co-located teams, agile methodologies promise mitigation to the challenges present in distributed software development with their demand for frequent communication. We examine the application of agile practices in software engineering teams with low geographical distribution in Austria and Germany. To gather insights on challenges and benefits faced by distributed teams we conduct interviews with eleven representatives and analyse the interview transcripts using the inductive category formation method. As a result, we identify four major challenges, such as technical obstructions or the impediments different language abilities have on communication, and four benefits, regarding collaboration and information radiation, that agile methods yield in distributed teams. Based on our analysis of challenges and benefits, we deduct seven recommendations to improve collaboration, overcome distance and avoid pitfalls. Key recommendations for teams with low geographical distance include that teams should get together at certain points to build relationships and trust and share information face-toface.

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The paper deals with the decision process for IT outsourcing as a governance strategy for IT harmonization. IT harmonization is the standardization of IT solutions and IT functionality within former autonomously acting organizational units with independently grown IT departments. A case study shows the migration and implementation of a lead e-government application in the Austrian federal administration, where records management and workflows were previously operating independently in government agencies. Harmonization has been accomplished via a directed outsourcing decision which also supported the process of harmonizing IT governance. Sourcing design has proven to be crucial in that case, as several stakeholders presented different principle objectives. The approach of the outsourcing decision within the case study is analyzed by examining the decision process and interviewing major participants of the project.