Outsourcing software development is a widespread practice nowadays; most companies do it. But there are still many companies that are not aware of how to successfully outsource software development.
“The important thing about outsourcing or global sourcing is that it becomes a very powerful tool to leverage talent, improve productivity and reduce work cycles.” – Azim Premji, Chairman of Wipro Limited.
As per the US Bureau of Labor Statistics report, the United States has more than 1.8 million software developers contributing to many software products and services used worldwide.
On the other hand, Statista says the value of IT services companies delegated to external suppliers may exceed $413.72 billion by the end of 2021.
Image Source: Statista
This clearly shows that outsourcing custom software development is a profitable and growing business. Companies, including small, mid-size, and large corporations, are shifting their focus to offshore outsourcing.
So what’s the secret ingredient that companies need when outsourcing software development projects?
Important Points to Consider Before Software Development Outsourcing
“Companies are past the basics of talking about outsourcing and offshoring. Executives understand outsourcing now and want to know how to effectively use it in their organizations.” – Jagdish Dalal, CEO of Corporate Affairs.
Well, if you do: keep reading! With this, you will have a better understanding of the ins and out of software development outsourcing.
1. Clarify the Goals & Objectives of Outsourcing
Outsourcing carries a certain amount of risk. However, when done correctly, it can provide numerous benefits to the firm.
Before starting with the technicalities of outsourcing software development, it’s best to establish clear goals and objectives for your business. Ensure that you understand how outsourcing will help you achieve your long-term plans and reach your organizational objectives.
What do you want from the outsourcing partner? Consider cost, time, quality, and more. These are some of the core factors that will help you understand how to outsource software development successfully.
- How much does it cost for offshore software development services?
- How long can they deliver?
- Do they have an experienced team to develop your product or service?
2. Compare Different Outsourcing Models To Pick The Best One
There are different outsourcing models available. Each model has its pros and cons. But the most common ones include:
- Project-based-model
- Team-based-model
- Fixed price model
- Time & Material model
You can pick the best fit from these outsourcing models. You can also consider a mix of two or more models as possible, depending on your requirements.
Comparison of Different Software Outsourcing Models
Project-based-model | Team-based model | Fixed price model | Time & Material model |
1. You can easily track the progress. | 1. With this type of model, the outsourcing partner assigns the team that will work on your project to ensure proper ownership and accountability. | 1. This model is an ideal fit for large projects due to its fixed price feature. | 1. It’s good for both small and large projects as it provides the necessary flexibility to meet customers’ needs and allows them to make changes as they go along. |
2. You don’t need to worry about over-billing or under-billing. | 2. It’s easy to manage the team as you have only one point of contact. | 2. You can set milestones and deadlines to maintain the budget on track. | 2. Payment is made only based on time and material used by the team. |
3. This model is ideal for small and medium-size projects, as it doesn’t include additional services like maintenance support etc. | 3. This model is ideal for long-term projects or ones with multiple deliverables, including maintenance support, etc. | 3. It’s good for cost-savvy customers since it puts you in control of your spending on outsourced software development services. | 3. This model creates a strong relationship between the two parties and helps build long-term relationships. |
4. This model lacks flexibility for those with changing needs. |
It’s essential to understand which one of these models will work best for you. You want to ensure that your goals and requirements are met at the end of the outsourcing agreement without any significant issues or delays.
3. Research Vendors & Discuss Your Requirements
Once you have a clear vision about your needs and how outsourcing will help achieve them, the next step is to research different vendors.
Researching potential partners can be time-consuming, but it helps you understand their business model, clientele, team composition, certifications, etc.
There is, however, an increase in IT Outsourcing services demand worldwide, not just in one region or country.
Image Source: PixelCrayons
One other fantastic statistic that the Indian Brand Equity Foundation (IBEF) has predicted is that the Indian software and IT industry will achieve $350 billion in revenue by 2025.
- You need to be sure that your outsourcing partner has ample experience in the industry.
- You can communicate with them over email or speak to their past clients.
When you are clear about what you want, use this information to discuss your requirements with potential software development service providers. Discuss timelines, project details, quality expectations, etc., to ensure that both of you understand each other’s expectations.
4. Evaluate Agencies & Hire The Best One
It’s better to go through an evaluation process to ensure they are the right fit for your team and requirements.
Here are some quick tips you must consider while assessing potential partners:
- Experience
The more experienced customized software development service providers you work with, the faster your project will be.
- Familiarity With Industry Standards
You need to make sure that they are familiar with the industry standards and follow them to achieve the desired results.
- Ability To Meet Deadlines
The ability to meet timelines is one of the most important factors for an outsourced software development company. Your service provider should be able to meet the deadlines without compromising on the quality of work.
- Costs
Ensure that you are aware of all expenses associated with outsourcing your team, along with any hidden charges or fees. They should be transparent in their billing structure. However, the leading reason for outsourcing IT services is to reduce costs by 70% of surveyed companies.
- Communication
A strong communication process leads to a successful software development project. You need to work with a service provider with 24/7 availability through multiple communication channels, including phone, email, online chat, etc.
- Quality of service
Ensure to choose a vendor who will meet your quality requirements and standards. Choose the right outsourcing software development company to ensure that your project is in good hands.
5. Test the Developers’ Skills
Once you have finalized your partner, it’s time to test their skills and expertise. Send them a small project to make sure they are capable of delivering results as per your expectations. You can also share mock code with them for review before starting the actual project.
Here are some standard testing methods that you can use to ensure that they are the right fit for your team:
- Sending them a small project with specific requirements. Make sure they understand the goals of this project and provide you desired results within a specified deadline.
- Sharing mock code for review before starting your actual project. They should be able to review the code and provide necessary feedback if needed.
Important Points to Consider After Outsourcing Software Development
1. Ensure Communication Is Strong
The success of your outsourcing venture depends on your ability to communicate with them at all times. You need to discuss the project details, goals, expectations, deadlines, deliverables, etc.
Use multiple forms of communication, including chat/email/phone calls, for clear and easy communication. Whether there is a time zone difference or not, ensure that your service provider is available for you to discuss your requirements.
A strong communication process will prevent misunderstandings and ensure that the project is completed within the specified budget, on time, and to the highest quality standards.
Furthermore, India has the world’s largest talent pool, which draws businesses to the country. Every year, approximately 0.5 million software graduates are hired by Indian IT organizations, resulting in 98 percent of young and skilled developers between 18 and 35.
Image Source: PixelCrayons
2. Ensure That Deadlines Are Met
After outsourcing software development projects, you need to ensure that they meet all deadlines without compromising quality.
You can use communication channels to discuss deadlines and ensure no delays in any project phase, from design to development to testing.
3. Check The Quality of Work Delivered by The Outsourced Team
Always check the work delivered by your outsourced team for quality. It should be original without any plagiarism or copied content. The technical part of the work should be error-free, secure, and secure to leverage all functionalities provided by your platform.
Furthermore, here is a quick difference between an in-house development team and an outsourced development team.
4. Embrace Agile Methodology
Agile methodology is a globally accepted approach for managing software development projects. It helps you achieve your goals on time, within the specified budget and quality standards.
The agile methodologies include Scrum, Kanban, Lean, and XP that help in delivering high-quality results on time with minimal efforts.
5. Seek Regular Feedback
Seeking regular feedback from the service provider is one of the best ways to ensure the success of your outsourcing venture. You need to ask them about their experience and provide suggestions if there are any improvements you want them to make.
Ending Words!
Outsourcing software projects are a great way to reduce costs while leveraging the best talent around the world. However, you must choose the right vendor who will meet your quality standards and budget.
By following these steps, you can ensure that your outsourcing project is in good hands and delivers results as per your expectations.
FAQs
Q1: How do you outsource software development effectively?
A1: The process of outsourcing software development effectively involves following the right strategies to identify the best talent worldwide who can manage your project successfully.
You need to list your requirements and share them with service providers to get competitive quotes for each task.
You also need to check their experience in managing similar projects along with their skills, knowledge, and expertise to manage your project successfully.
Q2: What kind of work can be accomplished by outsourcing software development?
A2: Outsourcing software development involves different activities that vary in complexity, scalability, and scope. For example, if you want someone to develop simple web-based applications for your company, then it is relatively easy.
However, if you want someone to manage your entire product development cycle, including design, implementation, testing, and deployment, it is relatively more complex than web application projects.
Q3: When should you outsource software development?
A3: When you need a full-time resource to manage tasks on an ongoing basis, you must outsource software development.
For example, if your company lacks the necessary resources and expertise, it is preferable to outsource mobile and web apps continuously.