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How to successfully outsource a software project

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Software development can quickly become one of the most time-consuming and costly endeavors a business may attempt. For example, if the development requires bespoke software, a team of highly trained programmers will be necessary. But did you know there’s a way to avoid all of these problems?

Outsourcing software development can be a great way to avoid the high costs and constant time management associated with software development. But what exactly is software outsourcing? Can it truly save you money? And how do you go about outsourcing development to another team?

Below you will find answers to all these questions and more. So whether you are looking to outsource your next big project or just want to know the benefits associated with outsourcing, take a look at our guide below to get started.

 


{WHAT EXACTLY IS SOFTWARE OUTSOURCING?}

Software development outsourcing is where you hire an external development team to craft a custom software solution for your needs. As opposed to developing your new software entirely in-house, outsourcing allows you to hire a team of specialists to handle development and management for you.

Thousands of companies around the world regularly outsource software development to a team they can trust. Some of the biggest names in the world regularly make use of this resource, including:

  • Netflix
  • Apple
  • Nasdaq
  • Harvard University
  • World Bank
  • Securitas AB
  • Microsoft
  • IBM PartnerWorld

Outsourcing software development to a trusted partner will allow you to focus your entire attention on your business’ growth.

As you might expect, this opens up a whole host of benefits that can help your business out. Sometimes you may find specialists that are not available elsewhere, but they will also have the passion for creating an effective software solution.

{Benefits of outsourcing your software development projects}

It lets you focus on core activities

Specialist software development can be an essential part of the progression and success of a company. However, due to how challenging and time-consuming a software project can be, it will require large amounts of focus from you and your business’s managers.

Software outsourcing will give you the freedom to divert your attention to other sectors of your business that may require immediate attention. Business growth is based on many factors, so knowing you aren’t bogged down with just one project can massively help you out.

You should still keep up with the development progress where possible through scrum meetings, where stakeholders and management can be kept abreast of progress, and online meetings, but this will be far less often than using an in-house team. A reputable outsourced team will be able to manage almost all issues that arise, giving you peace of mind and freeing up your focus.

FREES UP Managers time

Managing a large-scale project can become time-consuming, especially with an in-house team. With so many factors coming into play, you can either hire a dedicated project manager or handle the project yourself.

Choosing to outsource software development projects will save time for both you and any associated managers. Most software outsourcing services will feature an in-house project manager – saving you from micromanaging the development process.

This can be an understated benefit as it frees you up to work on other projects that might require your immediate attention. It can also help you manage your budget more effectively as you won’t need to participate in development actively.

SAVE ON COSTS

Hiring an external team to work on your software development project is an excellent way to save on costs. Though the industry is fast-moving, as long ago as 2017, Forbes had the insight to publish an article looking at the pros and cons of outsourcing and included the opportunity of cutting costs as a major benefit.

In most cases, you always won’t be required to purchase additional resources for the software development process. A software outsourcing company will usually be in charge of its own resources, meaning you won’t need to buy the latest hardware or software for development constantly.

When outsourcing software development, you won’t need to continue to pay a wage after the project is done. When hiring a new developer, you will tend to keep them on board post-project completion. So not only will the cost be lower during development, but you also save once the project is complete.

Software development outsourcing is one of the easiest and cheapest ways to create bespoke software for your business.

access to skilled software developers

Hiring a specialist for a specific task is not only costly but can also be complicated. When outsourcing software development to an external team, you can access a range of skilled developers that you may not usually have access to.

Outsourcing can give companies access to specialists in a variety of software development fields all around the world. The benefit of this is that living and labour costs will vary, making it possible to find value for money outsourcing opportunities.

For example, at the time of writing, figures from Numbeo show that the average cost of rent for a 1 bedroom, city centre apartment in the UK is £749.93 compared to £114.42 in India, a difference of 84.74%. Average monthly net salaries in the UK are £1953.74 compared to India’s £315.09, which is 83.87%.

This will give specialists in countries with a lower cost of living the opportunity to offer a lower-priced service. You must research outsourcing software development companies to ensure the quality is of the standard you would expect, though.

An external software development company may also have access to hardware that your development team does not currently own. For example, machine learning requires costly hardware, which an outsourcing company may already own.

It is extremely beneficial for an outsourcing business to keep up with the latest digital trends and programming software. Any project that requires a niche programming language or dedicated hardware is incredibly suited to a specialist outsourcing software development company.

If you are considering developing specialist software or just want a team of the best developers to handle your project, outsourcing may be the right call.

Reach international partners

A great advantage of software development outsourcing to an overseas team is forming bonds with international teams. Creating links with international partners is a great way to add diversity to a project and open the door for future projects.

Partnerships can also outlast the software development outsourcing stage, offering you a way to reach a target audience typically outside your reach. International partners are an excellent addition to any software development or marketing project, so ensure you choose a team you are looking to create a lasting bond with.

An offshore software development company can be a great partner to have if you plan to work within software development in the future. Be sure to put in the effort to develop a lasting relationship; it is more than worth the time investment.

manage the risk of a large staff team

It may not seem initially obvious, but outsourcing the development of your software to an external team will involve less risk than an in-house project. One example of this is when it comes to financial risks and investments.

Outsourcing software development projects means you won’t need to invest in one-use tech or hire new team members for specialist fields. This makes outsourcing especially ideal for smaller companies or start-ups who haven’t formed a dedicated development team yet.

Managing a large team can quickly become challenging as you need to adapt to accommodate individual team members. Due to constant development in larger teams, software development companies will be incredibly experienced managing projects of this magnitude.

Lowering the chances of financial risks is something that any business will strive for, and outsourcing can achieve this. Just make sure you research any potential outsourcing partner to check how successful they are at managing risks.

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{Considerations to make before outsourcing software development}

do you already have the resources?

Before considering hiring an external software development team, consider whether you already have the resources required to complete your project. If your team has already made progress and the resources support this, outsourcing may not be required.

One of the main reasons a software company may outsource a project is the cost associated with the required resources. But if you already have the resources, then outsourcing may be a wasted cost – this, of course, depends on if the resources are enough to finish the project.

As with all development decisions, you must analyse what your team has available to them. If you do, then you may be able to save yourself a fair amount of development costs.

Is your budget sufficient for outsourcing?

Although outsourcing software development is regularly far cheaper than hiring a team of full-time software developers, it will still come at a cost. Outsourcing costs can vary greatly depending on the company being used, so that full cost transparency will be essential from the start. If you are planning on software development outsourcing, then make sure you take some time to plan out your budget.

Chat with your team managers and figure out exactly what you want from the software development process: do you want a truly bespoke software suite? Are you considering hiring a well-known software team? What resources are required?

Ask your trusted team members questions such as these, as they will greatly impact the cost of software development outsourcing. If you are struggling to lower the costs, consider what you truly need your software to accomplish and how robust it needs to be.

You may quickly realise that you simply can not afford to outsource software development to a specialist team. By budgeting, you could also save yourself a lot of money as you may quickly realise ways you can save that you otherwise might have missed.

are you going to make the most of your new software?

Whether you are outsourcing software development or building it entirely in house, developing any software can be expensive. From wages to purchasing resources, individual costs can quickly add up.

Before you pay a specialist team and outsource software development, determine whether or not you will truly get the most out of your new software. It can be quite difficult to know how much you will use the bespoke software, so ask your staff and see if they think it is needed.

You should also check the current software market as there may already be software out there that is perfectly suited for your tasks. Not all software needs to be bespoke, so you might be able to save yourself a costly development process.

However, if you are planning on specialising in a niche field, then developing your company’s software is more than worth it – just try to ascertain how much use you will get out of it before investing.

do you have a trusted outsourcing partner?

Before you negotiate with a range of software development companies, be sure to consider any outsourcing teams you already have links with. Developing partnerships and relationships are essential in the corporate world.

If you are lucky enough to have a trusted outsourcing partner you can rely on, then consider handing your project over to them. Hiring a team you trust can negate the worry that they might underperform, and it could also save you money further down the road.

A partner you trust will also know your businesses needs and expectations, which will help them develop robust software suited to your brand.

Time is money for managing a large business, so it’s always a good idea to save time where possible. Negotiating a deal and getting to know a brand-new company will take time – and can be completely avoided by hiring someone you already trust.

Few businesses can boast a trusted outsourcing partner, so if you are one of the lucky few, then be sure to work alongside them where possible.


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{how to choose a software development company}

experience

Honing a skill usually requires two things; managing time and effort, which can both come with experience.

A team with a long history of working on projects similar to yours will tend to offer a better service than those that lack experience. This isn’t always the case, but if you try to decide between two teams, the one with more experience may be better suited to your project.

Not only will more experience lead to better programming skills, but the experience can also help when it comes to managing large projects. If a team has already worked on a similar project before, they will know the best way to tackle individual elements – this can lead to a far more efficient development process.

If you are in the process of comparing outsourcing development companies, taking the time to look through their respective portfolios of work, or previously completed projects, will give you a far better understanding of what you can expect from them.

Requesting evidence of previous work on projects closely related to your software project is recommended. This will give you a better understanding of their development process and give you the information you need to make a fully informed decision.

Specialist areas

Gaining access to specialist areas without purchasing the necessary hardware or hiring experts can be a challenge. Not only are most specialist areas expensive to access, but they can also be challenging to access due to how competitive they are.

Thankfully, by taking the time to compare pre-existing software outsourcing services, you may be able to hire a specialist team for your project. Not only will this save you the hassle of trying to enter a difficult field, but it can also save you money on specialist equipment that may be needed.

Finding an outsourcing company covering specialist areas shouldn’t be too difficult as they will most likely advertise specialist skills. However, if you are in any doubt, simply ask what specialist areas they can cover.

Some of the most popular specialist areas that an outsourced team may be able to help you out with are:

  • Machine learning and neural network tasks
  • Functional programming designs
  • Database design and data management
  • Network administration and programming
  • Integrating existing software

Much like gauging a team’s experience, you can also inquire about a portfolio or an example of previous projects they have worked on. This is perhaps the best way to check if they have experience in specialist areas.

Depending on your specific project, you may not need a specialist. If your project isn’t within a specialist area, then the added cost of hiring a specialist team may not be worth it.

examples of previous work

A great way to gauge how experienced and skilled an external development team is, involves checking out their previous work. It isn’t uncommon for most software development teams to offer a portfolio to potential clients offering a glimpse into past projects.

Portfolios can show you exactly what an outsourced team has experience in and how skilled they can be. With so many different elements within software development, getting an example of what a team can achieve can truly help you make your decision.

Another bonus to checking out a client’s previous work is that you will be able to see if they have worked on a project similar to yours. If you plan to develop a specialist software suite, a team with similar work experience may be better suited to your project.

This is why it is vital that software development projects are checked throughout each stage in their development so that if a problem is present it will be identified and overcome early on before the next stage in the development begins.

cost

One of the biggest benefits of outsourcing software development is that it tends to be far cheaper than hiring a new software developer. If cost is a large consideration in your decision to outsource, you will want to make sure that the external development team is affordable.

Before you settle on a single software outsourcing company, compare the costs between a few different teams. You will want to find the ideal balance between experience, skills and cost so that it can seem fairly difficult at first.

A range of different factors will determine the cost of outsourcing. Be sure to keep the following in mind when trying to figure out a reasonable budget:

  • The experience of the software development outsourcing company
  • Whether or not your software requires specialist development
  • The overall size of your project, such as the number of developers required
  • Will you need continuous technical support once development is complete?

Try to determine a budget for your outsourced project to determine which outsourcing software development team is the best for your project. This way, you won’t be tempted to spend more on a team that your budget cannot accommodate.

The best software development projects are those which expertly balance the needs of the project team with those of the end-user. These needs can vary depending on the industry in which the application sits, but usually involves a mix of ‘giving the consumer what they want’ and ensuring that software standards adhere to the industries specific goals – such as enabling volume purchasing or avoiding inconsistencies.

local or overseas?

Deciding between a local development team or outsourcing to a team overseas can be quite difficult. An overseas team might be slightly cheaper, but it can be hard to remain in constant communication, especially if they are in a different time zone.

On the other hand, a local team will be far easier to coordinate with but may cost you slightly more – which can sometimes be worth the investment.

The best way to decide between a local or overseas software development team is to compare their experience and skill level. The cheaper option is usually better if they both have similar skills and past experiences.

It is advisable to try to decide what you value most in an outsourcing company to decide better which team you want to handle your project.

scalability

Scaling your staff to accommodate a project as it gets larger can quickly cost you a lot of money. In-house software development will regularly cost more than outsourcing development to an offshore team – especially if you need to upscale your team.

If you pass your project on to an outsourcing firm, you won’t need to worry about rescaling your dedicated development team. Before you decide on a team that’s right for your project, you will want to discuss the size of the team with your chosen outsourced teams.

Try to find an outsourcing software company that offers a flexible development team that can scale depending on the size of the project. Although most will want to decide on the size before development begins, you may be able to find some that can scale the number of software engineers they provide.

It can also be beneficial to sit down with managers and developers you trust to figure out the exact project requirements. Thorough planning is the best way to ensure any outsourced team can finish your project successfully.

level of involvement

A lot of how much involvement you want in a project will come down to personal preference. Some people prefer to let specialists crack on, whereas others will want to be involved in almost every decision.

When comparing software outsourcing teams, try to deduce how much involvement you want and how much the team is happy to offer. If a development team wants to work independently, then someone who wants high levels of involvement may not be suited and vice versa.

Software development teams are used to varying levels of involvement from a manager, so you shouldn’t need to worry too much about finding one that works with your needs. As long as you make it clear before signing a deal, there will rarely be any issues with this!

value compatibility

There’s no point working alongside a software development team if they aren’t compatible with your business structure and values. Finding a company that shares similar values to you is a great way to form a corporate relationship but can also help boost productivity.

Working alongside a team that values compatibility can truly help when it comes to software development. There is a range of ways that a company can be compatible with yours, such as work ethic and methodologies used.

There is a current debate over whether waterfall methodologies is the only project management procedure feasible within the world of outsourcing. In reality, as long as both companies share the same working methods, then any methodology is feasible.

During negotiations, always ask how a team works and whether or not they think they could work well alongside you. Compatibility can really help an outsourced project get off its feet.

transparent processes

One of the biggest worries people may have when hiring software outsourcing services is that you may not keep track of development. As you won’t be managing each aspect, it can be difficult to see how development is progressing.

Thankfully, there is a range of online tools that can be used to track development on any large software development task. Trello and GitHub are just two examples of some of the fantastic tools out there designed to help keep track of development in a range of programming languages and IDEs.

On top of this, most software outsourcing teams will be familiar with these and will happily keep you in the loop with development. Software engineers regularly work in large teams, so sharing progress with other team members is vital to success.

When negotiating a deal with a development team, be sure to ask about the tools they use and how they plan on sharing progress with you. Transparency can be a large deciding factor, so try to find a company that will not only offer you a glimpse into development but will also guide you through the software they have developed!

Good communication channels

Although you won’t be required to manage each element of your new project individually, clear communication is essential. It can be hard to determine how effective an outsourced team is at communicating without working with them.

One of the most effective ways of finding out is simply checking a few reviews online regarding their services. Communication is an essential part of collaborating with external teams, so if a team can’t communicate, the reviews will usually show this.

You can also judge a team’s communication before hiring them by checking how often they reply to any enquiries you have. However, this is fairly unreliable so try to still back this up by checking out reviews online.

Software development companies regularly work with external clients, so finding a team that struggles to communicate is extremely rare. With so many ways to communicate as a team today, such as Slack and Microsoft Teams, you will rarely run into communication problems.

post-project support

Another great addition to look out for is whether or not your chosen outsourced team offers post-development support. This can be in regular patches or bug fixes or even just support for further development.

Not all external developers will offer this, though, as it is not always beneficial to them, but it should be something you keep your eyes peeled for. Most applications and software will require regular maintenance and even upgrades as technology improves.

Continuous project support can also save you large sums of money as you won’t need to hire a whole new team to handle updates and patches. Software outsourcing teams will typically be happy to work on a project after completion as it provides them with constant and reliable work.

We would recommend hiring services from a company that offers support once a project is complete. Your business’ budget and the in-house team will be extremely thankful.

{tips for a successful outsourcing partnership}

communication is key

As with all successful team-based projects, communication is vital. A software outsourcing company will need to know exactly what your aims are and what you expect from them to develop the software you require.

Before you outsource your project, ensure that the team you are outsourcing it to communicate effectively. Bad communication will make a difficult task even harder, so try creating shared channels on software such as Slack and Discord.

The choice of development method can also have a large impact on communication. If the outsourcing team relies on AGILE development, frequent scrums are vital to the project’s success. By coordinating meetings, you can keep up to date with the team’s progress.

Once the project starts, however, communication is still needed. Throughout the software development, try to keep up regular meetings or video calls. Most software outsourcing companies will be excellent at communicating, but it’s best to discuss this beforehand!

know your goals

When it comes to software development outsourcing, you may not be able to micromanage individual elements the way you would with an in-house project. Establishing salient goals beforehand with the external team is extremely important.

This may mean you will need to create a plan beforehand that both you and the software outsourcing company can use to stay on track. You should also try to think of any contingencies in case issues arise during development.

An underappreciated benefit of planning is that it will help you find the ideal software development outsourcing team for your project. By establishing goals early on, a team will decide whether or not they can truly achieve what you are aiming for.

As long as you make sure that you clearly set out what you want the software to achieve and how you want it to do this – you shouldn’t bump into any issues.

stay open to new ideas

Adaptability is crucial when it comes to the software development process. We have all bumped into issues when creating new software, whether that’s team or code-based, so it’s important to ensure you are open to new ideas.

Although sticking to an established plan is a great way to keep development on track, you should also accept that you may need to change facets of your software. An outsourced team may notice issues that your in-house team missed – which could massively change the development process.

Big changes should, of course, be discussed between you and the outsourced software engineers, but you should be ready to make that call. Being open to new ideas can help enhance your project, so listen to the developers and be prepared to make changes you may not have previously considered.

work out your partner’s strengths, and use them!

When finding the right outsourced software development team, you will probably have checked their portfolio to see what projects they have previously worked on. If your chosen software development team has skills that could help your project, be sure to use them!

By spending time getting to know your partnered development team, you can discuss where their strengths lie and how that can help the development process.

For example, if you are looking to build an image classification database and know your chosen software development team has experience in neural networks, take advantage of this. Not only will the external team be happy to work on something they are familiar with, but they will also be far more suitable for the task.

Ideally, you should spend some time getting to know a team before hiring them for a software development project. This way, you can determine whether or not they are the best team for the job and if it is worth outsourcing development.

put time into developing the relationship

Much like steady communication, a strong bond between you and the outsourcing company can certainly improve project productivity. This is especially true when working with a company that shares similar ideals to you.

By cooperating with external teams, you may just form a relationship that can benefit both of you further down the road. Whether that’s by sharing development on a new application or combining a product with theirs, a strong inter-business relationship can be a great boon.

Forging links with overseas companies can be difficult, especially if you both work in differing fields. Software development outsourcing can offer you the platform you need to get in touch with businesses around the globe.

It has never been easier to develop a relationship with a team in another continent, thanks to the array of remote-working software available. Be sure to take the time to familiarise yourself with the outsourced team with software such as Zoom and Microsoft Teams. Who knows, it may form a long-term partnership!

{faqs}

With so many benefits, from saving development costs to receiving access to specialist software, software development outsourcing is more than worth it. Not only will you save money on expenses, but it will also free you up to focus on your business’ growth.

The outsourced team will handle almost all project development themselves, so you will only need to manage larger decisions. It can also help free up any other managers in your business, which any business manager can appreciate.

If you plan to work on a large software project in the future, or even just a smaller set of patches, consider hiring a software outsourcing company!

There is a range of benefits to hiring a software developer or outsourcing your project to an external development team. If you are looking to save money and worry that your business does not have the resources for a large project, outsourcing may be best suited for you.

However, if you want to ensure you have full control over a project and finances aren’t too much of a worry, an in-house software developer may be the right call.

Try to weigh up the pros and cons of each before making a final decision. It can be difficult to know exactly which is better suited to your project, but discussing possible options with your development team can be a great way to decide.

Much like hiring any external service, the first step is to find a team that is right for your outsourced software development. By using our handy guide above, you should have no issues doing this!

Once you have found a team right for you, you will want to negotiate the cost, show them what you need and discuss whether this is feasible. If possible, then a contract should be created that allows the outsourced company to handle your development for you.

The cost of outsourcing a project to an external development team will vary depending on what is required and how large the project is. Larger projects will, of course, cost slightly more than small-scale software, and the same goes for a specialist program.

Typically, you can expect an outsourced project to cost you anywhere between £20 to £75 an hour, depending on the developers’ skill. This is cheaper than hiring a full-time in-house developer, but it may not be what your company needs.

Communication during the whole process will be key to your budget. You will already have agreed on rates, but knowing whether the project is running to schedule is essential.

By being kept up to date through each step of the process, you will pinpoint any potential problem areas that may lead to costs spiralling out of control. Outsourcing does not mean an abdication of responsibility, and there will still be areas of project management that will need to be adhered to.

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