Based on our 15-year experience of software development outsourcing, this article presents all you need to know about outsourcing: benefits, challenges and strategies for outsourcing software development projects.
Furthermore, this piece highlights key considerations to keep in mind when selecting outsourcing firms and services providers - we want you to maximize all possible advantages from this endeavor! So lets get going now and maximize the advantages that outsourcing brings!
What Is Outsourced Software Development?
Software outsourcing refers to delegating an internal software development project to an external organization for completion, usually via outsourcing agreements with third-parties.
When this decision is taken by companies they often enter into outsourcing agreements in order to start new software projects with third-parties and delegate software development functions accordingly.
Why Do Companies Outsource Software?
Outsourcing software development offers many advantages, from increased productivity and product quality improvements, to cost savings.
But to truly outsource IT development effectively requires medication. Incorporating an outsourcing strategy as the cornerstone of hiring the perfect partner. So how do you go about doing that?
Why do companies outsource their software development? Outsourcing your software development can bring many benefits to your business.
Reduce Software Development Cost - As technology rapidly changes, software industry dynamics also are shifting quickly.
Due to these rapid transformations, hiring and training developers for project work may create additional overhead expenses and costs that exceed expected return.
A High-Quality Software Team - Software outsourcing services offer you access to teams of developers with diverse skill sets that will allow them to help understand both technically and domain aspects of a market from all corners.
Hire Specialists Faster - Time is money, and one way you could save even more by hiring pre-approved specialists is outsourcing your hiring needs to dedicated developers as part of outsourced teams.
Once hired into one, reap its full benefits without extra work on your part; sometimes hiring processes for outsourced teams take as long or even less than hiring one developer from within your own setup - consider what time and money savings could come your way by outsourcing!
Access To World-Class Talents - One of the greatest advantages of an outsourcing network is being able to bring world-class software developers right into your office (at least virtually).
You just need access to project management and collaboration tools in order to leverage all this talent effectively.
Scalability And Flexibility Of Team Size - One great aspect of outsourcing software development is being able to access an "on-demand" service model.
Simply imagine having a scale reflecting both cost and skill in relation to your project; even though this scale wont give an exact representation, it will give an indication of just how much freedom exists when scaling projects according to need versus time and money saved through doing this yourself. The time and money savings gained can be enormous!
Use A Team That Is Managed - Use team development rather than individual developers to save both time and money while managing projects more effectively.
Hiring the appropriate manager for in-house teams may prove difficult; when outsourcing however, all teams come already managed - meaning no additional worry for your in-house staff members when hiring management for projects. It remains essential for projects to have proper direction from management; outsourcing can fulfill much of that duty for you.
Focus Your Business On The Core - This brings us to our final advantage of working with an outsourced software development company.
Fasting on your core business is a great way to achieve a better overall result, since you will not be distracted and wont lose sight of the original ideaIt could be the most important aspect of your business.
Outsourcing Software Development Models
Before outsourcing a project, it is essential that you carefully consider some fundamental points. This guide focuses on building healthy relationships between client and provider as healthy relationships are the basis of business success; distance will no longer matter when relationships are strong enough.
Below are three models of such relationships.
Staff Augmentation - With staff augmentation, you are completely responsible for overseeing every step of your project from its inception.
Clients assume most responsibility, while you hire specialists from an outsourcing firm to strengthen the development team.
Managed Team - This model involves sharing responsibility between client and outsourcing provider to determine who assumes what responsibilities.
Your managed team operates separately from internal staff while an outsourced design director supervises daily operations and workflow.
Project Based - Outsourcing provider owns the project from beginning to end. He or she completes development systems to your specifications.
Different problems require unique solutions and software outsourcing models. You should first identify your problem before looking for solutions; staff augmentation is a good place to begin for those new to outsourcing; it gives them a taste of it while giving your relationship time to mature and change over time.
As your needs develop further so will other types of outsourcing models be available as your needs increase and relationships develop further.
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How Can You Outsource Software Projects?
Outsourcing software development has numerous advantages, including increased productivity, better product quality and cost savings.
You can not outsource IT development effectively without medication. Developing a solid outsourcing strategy is the original step to hiring a mate who can meet your requirements. How do you make one?
Define Your Goals
No project can expect every stakeholder, such as company leadership, end users or customers to participate equally in every aspect of a project.
Project stakeholders include company leadership, end users and customers among others.
Outsourced projects will often involve various stakeholders. This may include individuals or organizations not directly associated with it but who will still benefit from its outcome or have direct bearing on its final result.
Make sure your project is clearly defined by speaking to people both inside and outside your team, who work in the industry, so as you discuss ideas with others involved with its development.
Documentation Of Scope Of Work
Its pointless to contact a software outsourcing company without a plan. Documentation is key to letting them know what you want and how much it will cost.
Define Your Technology Stack
It is important that, as software development is often outsourced remotely, your partners technical profile matches your requirements.
We suggest creating a list of resources for your project to achieve this goal. Moreover, data loss and security issues should not be ignored.
Bring In An Experienced Engineering Leader
An outstanding leader is essential in building an engineering team. A good leader brings technical knowledge and selects talented members for each position within an engineering firm.
Furthermore, strong leaders can oversee remote teams while offering advice to clients while protecting you against issues like poor team coordination or quality assurance.
We are committed to being your software partner and have created tailored development tracks for engineering leadership positions.
Engineer Leaders play an essential part in managing teams and technology while working toward long-term client satisfaction on multiple fronts.
Outsourcing Software Development Step-By-Step
No matter how complex a product may be, it should still be able to be upgraded, maintained, and adapted. To achieve this, prepare each stage meticulously from conception to maintenance.
Software development companies have different stages in the SDLC.
Gathering Requirements - After a gap or an opportunity has been identified in the application landscape of the organization, it is important to document and understand the exact business requirements in order to choose the right solution.
In this phase, its important not to jump straight to a result. Stakeholders may bear coaching and support in order to keep an open mind and to avoid any preconceived result preferences.
Design - After the requirements of the new software are documented and approved, the design process can begin.
The organization should now decide whether it is better to build a bespoke system, or purchase something that already exists. It may be necessary to go through a tendering process, such as a Request for Proposals (RFP) and a Request for Information (RFI).
Implementation - During the build phase, software developers transform the requirements and design phases into actual software.
It could include building front-ends, back-ends, databases, microservices, or other components.
Testing - During the testing phase test judges conduct a variety of confirmation checks for the software, similar as performance tests, cargo tests, and exploratory homemade checking.
The main thing is to make sure that the work done in the figure phase will meet the conditions of normal operating conditions, and to determine what happens if those conditions are exceeded.
Deployment - In the deployment phase, software is loaded onto the production environments and platforms where it will run.
These environments can be either physical servers in a businesss data center or, increasingly, cloud-hosted platforms.
Maintenance - The system is handed to the team that will support it for the rest of its life in the organization during the maintenance phase.
The service desk staff will need the right documentation and help files to know where to send user support requests.
Read More: Software Outsourcing the Ultimate Guide 2022-2023
How Do You Choose A Software Outsourcing Company?
Congratulations on choosing to outsource software development! Now that the first step has been taken to launch a software project, phase two - finding suitable outsourcing companies - begins.
At this step in the development lifecycle process, it is key to take your time in selecting an outsourcing provider if you want to increase the quality of your project or risk its failure.
As such, this step requires much care and consideration.
Once again, depending on your business model and project at hand, when approaching this issue you should assess this matter from various perspectives.
First of all, evaluate their experience and abilities related to software development overall as well as whether those abilities apply specifically to your work as well as prior experiences theyve had working for clients similar to yourself.
Make sure they are the ideal developers for you by asking additional questions.
Pricing And Contracts For Software Development Outsourcing
Signing the Contract for Software Development Outsourcing with Us is your next step once youve identified an ideal development company.
Custom software development contracts are legally-binding documents which outline terms and conditions between contractor and customer - they help both reduce risks while exceeding expectations, guaranteeing quality projects while creating rewarding experiences working alongside us!
Paying a software developer can come in two forms - hourly rates or lump sum payments through whats known as a fixed-price agreement).
There are two contracts associated with software development: time and material agreement or fixed price contract.
Time-and-material - The most common type of outsourcing custom software development arrangement.
Signing a time-and-material contract commits you to paying developers for the time they spend on your project. To calculate the total quantum, multiply the number of hours delivered by each inventor by the hourly rate for the design.
Fixed Budget - A contract with a fixed price requires both parties to have a high degree of certainty about all aspects of the project.
This includes design and technical solutions. It requires an evaluation of all phases of the project, and is best suited for engaging suppliers to complete minor tasks.
Outsourcing Software Development Costs[Factors You Should Consider]
The cost of software outsourcing is an important factor in determining whether or not to outsource a project. The type of project, the size and the location of the vendor are all factors that may affect the outsourcing cost.
It can be difficult to estimate the cost of software outsourcing due to the differences between each project. What works for one may not work for the next.
Types of Projects
Included in software development systems are frontend, backend and full mound. They also include desktop, mobile, web, and desktop operation development.
Frontend Development - Highly-skilled developers develop functional and visually enhanced user-interfaces.
Backend Development - Individual developers focus on parts that are invisible to users. It involves creating an infrastructure that focuses on functionality, system interoperability, and the execution of business logic.
Full-stack Development - includes frontend and backend developments
Desktop Development - creating apps that run on Windows macOS Linux and other operating systems.
Web Development - is a web-based application that web developers create for users who want to access software via the internet.
Project Size
Estimating the cost of outsourcing software projects is largely determined by the size of your project. Large-scale projects require more time and resources, while smaller projects do not.
The size of the project is also a major factor, particularly for the time-and-material engagement model.
Location of Vendor
It is important to consider the location of your outsourcing vendor when estimating costs for software development.
These vary from region to region. Indias front-end developers are cheaper to hire than those in Australia or the United States. The hourly rate for backend and full-stack remote developers is also different depending on the vendor.
Outsourcing Software Development Can Be Risky
It is not the answer to all your problems to outsource software development. If you do not have a plan for outsourcing your development process, it can cause problems.
Here are some of the risks associated with outsourcing without a plan.
Delivery Delays And Low-Quality Products Are A Risk
Outsourcing software development projects is often risky. Be sure to verify if any code produced during this phase meets with original project specifications.
Many vendors make promises of timely deliveries; however, poor management often results in delays and complications.
Some vendors do deliver on time; however, quality must also be assured.
Target provides an ideal example. Target, an American grocery chain with ambitious expansion plans in Canada, hired consultants to customize a SAP system specifically tailored for their Canadian locations.
SAP system failed to deliver accurate information resulting in massive inventory issues for Target Canada stores across Canada; as such, over 130 shops had to close as a result of data overload and project management challenges associated with SAP systems malfunction.
Before releasing it to the public, your software should also be rigorously tested.
Outsourcing Software Development Is Associated With Security Risks
Subcontracting software means sharing sensitive information with vendors. Failure to enact sound data access and security policies could result in data being leaked - according to reports, 43% of cyber threats, whether intentional or accidental, occur within organizations; it is therefore paramount that internal networks and their data be properly protected from attack.
How can you secure your data when outsourcing?
RBAC policies provide the ideal way to combat such situations. With RBAC in place, access to data may only be granted to specific roles - employees or outsourcers could only access relevant files based on specific roles assigned to them.
Lack of Control
Your software project management options for outsourcing include onshore/local projects that allow more control, while offshore outsourcing offers less.
Choose an outsourced vendor who communicates openly about all stages of software creation to avoid potential headaches when outsourcing, like selecting an extended team to improve quality control of delivery of software products.
Vendor Lock-In
Outsourcing can be a risky business because it could lead to you paying more, but being restricted to one tech stack.
This could pose a serious issue when creating cloud-based applications.If, for example, your vendor provides AWS services to develop cloud-based software, then the tech stack is limited to certain tools and technologies.
Software Development Process
You want your software to be easy to maintain and flexible, no matter how complex or simple it is. To achieve this, you need to understand the software development cycle and know what best practices are to be implemented at each stage.
These are the phases that typically occur in a software-development process.
Read More: What Are The Best Benefits Of Software Development Outsourcing?
1. Idea
Each software project starts with an idea. You need to narrow down the idea by identifying the customers pain points and business needs.
The following activities are included in the ideation phase:
The feasibility of an idea can be assessed by using a PEST profile (Political Economic Social and Technological profile), a SWOT analysis (Strengths Weaknesses Opportunities and Threats), and focusing group discussion.
- Determining project scope
- List the project owner, objectives, deliverables, and goals.
- Defining various stakeholders
- Develop a business plan that will help you turn an idea into a successful product
2. Planning
The following steps are included in the planning phase:
- Making a project plan
- How to build a development team
- The roles and responsibilities each team member
- Estimating the budget total of the project
- Gathering hardware and software resources
- Evaluation of risks and creation of a plan for risk mitigation
- Documenting Software Requirement Specifications (SRS)
A rich documentation is essential to the success of any software development project. It is also important to update the documentation as requirements change.
In an SRS, you should include all the information that was discussed and analyzed in the planning phase. The SRS document is a roadmap that outlines the product development process and resources required to complete the project.
3. Designing
UI and UX is one of the first things that users will interact with while using your software. A visually appealing, intuitive and easily navigable design is crucial to ensure a positive customer experience.
In the design phase of the software development cycle, the following factors are taken into account:
Architecture: The overall skeleton of a product
User interface (UI): How the user interacts the product
Platform Specific Guidelines: Android iOS or Windows specific design guidelines
Communication: How a product interacts with other assets
Security: Measures for preventing data leakage, such as SSL encryption, password protection and 2FA.
Youll be able to create a prototype, which is a visual representation, at the end of the development phase.
4. Coding
At this phase of diy software development, your team must transform planning and design into a product.
Small-business projects may only need two experienced coders for completion.
When working on large projects, its essential that tasks be divided among various people according to their areas of expertise.
A front-end designer will be in charge of designing an intuitive UI; database administrators handle database structure; while backend developers link together both frontend and backend.
Check that all code produced during this phase complies with original project specifications. Developing will likely consume most of your time; if all teams involved have collaborated effectively to reach desired goals in planning and design stages, however, obstacles should not present too many difficulties during the development phase - you should complete it successfully by leaving behind a working code repository with the product at its conclusion.
5. Testing
After the development phase is finished, the quality assurance team will perform quality assurance. To look for bugs, errors, or security holes, they will examine the source code.
The product is now subjected to a variety of tests, including functional, regression, unit integration, security and usability testing, as well as black box and white box testing.
Once all errors have been found using the established quality assurance procedure, the QA team will send the comprehensive report.
The development team then sends the report back to QA for additional testing after fixing any bugs or errors. Iterative in nature, the process continues until all bugs have been eliminated from the final product.
6. Deployment & Maintenance
After the testing stage, you release your product to a small group of users who are also members of your target market.
The support team then starts gathering input from these initial users. Then you analyze the feedback and incorporate it into your product. Finally, you launch the product on the market. The cycle does not end there.
To stay relevant and to avoid saturation, you must strive for continual improvement. Software maintenance is a regular task your team should perform in order to maintain the best quality and performance.
Want More Information About Our Services? Talk to Our Consultants!
The Conclusion Of The Article Is:
Software outsourcing is more than just a decision. Its a transformation of your business. The results can be great if you do it correctly, but if you make a mistake, everything you have invested could go wrong.
Consideration of the project requirements, cost, outsourcing models and risks is important.
