When to Outsource Software Development

by Anna Khrupa on Mar 24, 2022

Both start-up and international companies outsource software development projects for various reasons. Despite having tight budgets, the companies want to receive the best solutions. High quality is a priority for businesses, which calls for utilizing the funds available as efficiently as possible. This necessity creates a demand for outsourcing IT solutions.

Why Do Businesses Choose to Outsource Software Development Projects?

Many companies of any scale prefer to outsource custom software development. Billions of dollars are spent in this sphere each year. Hiring a software engineer from outside of your company is highly advantageous. With the help of professional developing teams, it is possible to remain focused on your own objectives, cut costs on the software development, and receive a top-quality product in due time. Here are some of the main reasons why business owners continue choosing outsourced software:

  • Cutting costs. This is one of the most important reasons why businesses choose to outsource their IT solutions. Even successful companies need to make cost-efficient decisions, not to mention smaller businesses that are often on a tight budget. It is recommended to hire an outsourcing development team in order to make the most out of your money. This decision allows cutting expenses on training your own staff and eliminates the need to invest in the necessary resources.
  • Quicker software delivery. Software development takes significantly less time when outsourced to an expert team. Collaborating with a third-party company ensures that you will be able to meet your deadlines efficiently. Employees of companies specializing in software development are highly trained and have a lot of experience in this field. A team skilled in Agile development will help your business stay on top of your performance.
  • Focusing on your company. The process of hiring and training new employees is time-consuming and expensive. Delegating certain objectives, such as developing a specific software solution, to another company will grant you more time to spend on operating and improving your business. With the extra time you will have after outsourcing some tasks, you can make sure that everything is running smoothly and focus on innovating various sectors of your company.
  • Expanding the knowledge base. One of the reasons to outsource software development is learning from the experts working for other companies. In case your business lacks expertise in software development, outsourced professional engineers will provide their assistance. This is helpful not only for meeting deadlines but also for expanding your knowledge base. Even if your employees can technically do the job, it is always beneficial to learn about the latest frameworks and techniques that will help you in the future. In addition, your developers can receive useful info on how to create software quicker and with higher efficiency.
  • Meeting the highest expectations. A reliable software development company will not simply create a program for you. Professional software engineers know how to meet clients’ expectations by researching their target audience and competitors. Investing time and effort into research helps in creating top-quality programs and apps that will enjoy high demand.
  • Reducing risks. When collaborating with companies that specialize in software development, you are guaranteed to receive first-class service and meet all your deadlines. This way, there is no risk for you to fail in creating software and delivering it on time.
  • Expanding the reach. Investing in the most efficient software solutions provided by professionals in the field will help in developing your company. Masterfully created software based on meticulous market research will surely expand the boundaries for your company. Reaching wider audiences and offering them great software will ensure steady and constant growth.
  • Thinking outside of the box. You might have a team of skillful software developers in your company, but working on similar products all the time might limit their potential. Buying services from other developers will offer a fresh look at the objectives of a new project. Adding other professionals to the team might be also beneficial to improve the workflow and increase the skill level.

If you are wondering why outsource software development, the reasons listed above should give a clear answer to this question. And these are not all the benefits but just the key ones.

The Pricing of Software Development

Cost efficiency is one of the key reasons why businesses tend to outsource their software development projects. So, how much does it cost to outsource software development? The prices can vary drastically from country to country due to different taxation policies, laws, and other factors. For example, American software engineers can earn about 77 thousand dollars a year. Indian professionals, on the other hand, usually earn ten times less than that. Their relatively low prices attract business owners from all over the globe. Surely, low pricing might result in a poor-quality product. Yet, cheaper services do not necessarily mean compromised quality, especially if the cost of office space, energy, and other resources is lower in a specific country. Here are some of the criteria to keep in mind when looking for a highly skilled development team:

  • opportunities for technical education;
  • global IT ratings;
  • time zone differences;
  • proficiency in English and other languages;
  • the availability of resources and level of technical competence;
  • cultural differences, etc.

When picking a software development company to outsource your project, it is also crucial to look at their portfolio and examine previous projects to see whether they will be fitting for your requirements. In case they had similar tasks to what you require, this should be a huge plus.

How Can You Select a Fitting Team to Outsource Custom Software Development?

There are millions of software engineers all over the planet, and it is not easy to pick a suitable company quickly. However, much like with choosing any other service, it is possible to select a reliable and top-quality software developer. This is a small step-by-step guide on how to select a perfect candidate:

  1. Describe all your requirements (a mobile application or a desktop program, necessary deadlines, etc.).
  2. Look through available companies that can potentially work with your requirements.
  3. Pick a few candidates and do your research. Look through their websites and social media profiles, examine their portfolio and test cases.
  4. Contact these candidates to receive more detailed info about their prices, qualifications, experience, technical solutions, etc. Exclude those candidates that do not meet your requirements.
  5. Contact existing clients of companies that are left on your list and ask about their experience.
  6. Share information about your projects with the remaining candidates. Request at least approximate info about the cost and time of their execution.
  7. After going through all these steps, you can finally ask the candidates to complete a test assignment. This task should be short and straight to the point. Regardless of the results of the test, it is essential to pay all candidates for their work.

Based on the results of the test assignment, you can choose a company to outsource. If this company meets all your criteria and the assignment is done well, you can safely hire its professionals to help you with your objectives.

Creating a Contract for Your Collaboration with an Outsource Company

After finally choosing your perfect software development company, it is time to write a contract for your cooperation. This contract is very similar to any other contract describing a purchase of services, but there are certain points to be included, as this is a specialized software development agreement. Here are some of the sections that need to be covered:

  • Services provided. It is necessary to describe in full detail the services required from the outsourced company. The procedures for introducing changes in the scope of work should also be outlined.
  • Duration and pricing. You should specify hourly pay as well as each development phase with its specific deadline and the overall time required for the project to be completed. Conditions regarding possible delays in software delivery need to be stated too.
  • Acceptance testing. It is a crucial stage that determines whether all the conditions are met. It is necessary to spell out in the contract which side will be responsible for this testing.
  • Intellectual property rights. It should be stated clearly that the finished software belongs to the client. The developers should not retain the right to the finished product.
  • Security. It is crucial to determine which data are considered confidential. The consequences of disclosing confidential data should be described.

After signing the contract, your agreement with the outsourced company becomes official. The developers can start working on the software as soon as the contract is signed.

The process of finding reliable software developers to outsource a project is complex. However, the advantages of collaborating with top-tier developers from different countries make this process worth it. It is possible to reduce development costs greatly while receiving great programs. Thanks to meticulous market research, you can be sure that your product will receive a positive response from the target audience.

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