November 05, 2020
0 min read

Outsourcing software development: pros and cons

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What is software development outsourcing?

Sometimes in life, we need to call in outside help to do things for us. Be it a plumber, an electrician, or a babysitter, there are tasks that we don’t have the time or expertise to do ourselves. This same idea can apply to software development. Outsourcing is when you hire a third party to create the custom-made software your business needs. Software developers create software for you, or work alongside your employees, typically on a contract basis.

Why do companies outsource software development?

There are many reasons why companies may choose to outsource their software development. The largest motivators are to save time, and reduce costs. Other reasons companies choose to outsource include the desire to keep their business small, the need of industry experts, or because they only have a small amount of work to be done, and do not have an ongoing need for developers. According to the Gartner report, firms spent $3.8 billion dollars on IT outsourcing in 2019, and they expect that the trend will continue.

Related post: In-house development vs outsourcing software development

What are the advantages of outsourcing software development?

Wide range of talent

It may be that you’re not in an urban setting, or that the local talent was already snatched up by other businesses. Either way, it can be hard to find the people you need in your immediate area. By outsourcing, you can access talented developers from around the world. This increases your chances of finding the perfect team to suit your needs.

Finely tuned expertise

Custom software developers have worked with many different clients on many types of projects. No two clients have the same needs, and so the developers have had lots of practice. They can find the best way to create your software in the fastest amount of time. It is also possible that they have skills your in-house employees are lacking. This is especially true for uncommon or unique project types.

Concentrated focus

When you have too many things to oversee, some areas of your business will suffer. There just isn’t enough time in the day to focus on everything! Outsourcing leaves you with fewer worries, and more time to concentrate on your core business functions. Or maybe, your core developers are overwhelmed with other responsibilities. In this case, you can outsource specific tasks. That will ease the pressure on your in-house developers, and get the project finished faster.

Lower cost

The hiring and on-boarding process takes up a lot of time. Because they do not need the salaries and benefits of in-house staff, you can avoid those costs. Other overhead costs you can avoid are equipment, office space, and employee insurance. Software development companies also have incentive to keep their prices low, to stay relevant in the market, which means more savings for you.

Time efficient

Teams in outsourcing companies already know each other and work well together. There is no time wasted on getting to know each other's working styles, so they can progress faster than a new team would. They are also motivated to complete their jobs quickly and without any mistakes. Errors and delays only prevent them from moving on to the next client, which loses them money.

What disadvantages are there to outsourcing software development?

Communication barriers

Technology has drastically changed the way we communicate, but it is not flawless. Common communication problems you may run into are network outages, low or reduced bandwidth, and issues with communication platforms. With on-site staff, communication is easier, as you can walk over to their workspace, or call them. But when working with a team who is across the country or on the other side of the world, you have to depend on communication tools like Skype or Zoom. As we all know, these platforms are prone to mishaps and bad connections. Avoid this by having more than one channel of communication, with one as a backup.

Bad product

The greatest disadvantage of outsourcing is the potential of a bad product. Some companies boast a top-shelf performance, but may fail to deliver what they promised. You could get buggy code, or something that isn't up to industry standards. Another possibility is not getting your software at all! Avoid this by researching the company you want to hire thoroughly.

Complex project management

Outsourcing may bring up some unique challenges when it comes to management that you probably wouldn't have with your in-house staff. Time zone differences can lead to delayed communication and problem resolution, for example. It may also be that your company and theirs have different processes and decision policies. There may be confusion about who has the ultimate authority. Avoid this by discussing the process of decision making and working hours before the project starts.

Tips for effective software development outsourcing

Have clear goals

Before looking for potential developers, sit down with your project managers and other relevant staff. Discuss what you want and need, budgets, and other specifics. Having clear ideas will help the process move along quickly and smoothly. Alternatively, you can have a simple list of parameters, and decide on the details with the developers you hire. Good software developers will be very upfront about their process, and will want to know that they’re meeting your expectations.

Read more on aspects taken into account during the project planning in the Software development budget estimation article.

Agree on benchmarks

When the project is underway, it is helpful to have mini-goals (benchmarks) to meet throughout the duration of the job. Regular benchmark check-ins allow you to see that the project is on track, and work out any problems there may be. An easy way to do this is through your favorite project management application.

Research, research research

The disadvantages of outsourcing software development can be avoided with proper research. Look into custom software development companies and compare them. Check their client lists, past projects, and the experience of their employees. Find outside sources for reviews and client experiences. Anyone can say they have 100% satisfaction guarantee on their website, but a quick Google search can quickly prove otherwise.

Read also: Outsource web development in 2021 and beyond

Once you’ve chosen the right company for you, you can leave the rest to the excellent software developers you’ve just hired.

At Blocshop, we have four models we use to approach tasks. Whether you need an entire program built from scratch, or just a few things on the side done to ease your workload, we have the perfect approach to suit your needs. Do you want to know more about how we manage tasks? Read more about us here.

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