How to Successfully Outsource Software Development

outsource software development

How to Successfully Outsource Software Development

What is Software Outsourcing?

Outsourcing refers to the business practice of hiring a third party to perform a company’s services or render additional responsibilities. These were previously performed in-house by that company’s employees and staff. Outsourcing, as a practice, is usually adopted by companies to minimize costs. Outsourcing was first recognized as a business strategy in 1989. It, then, became an integral part of business economics throughout the 1990s.

Development of Software Outsourcing

Outsourcing software development is where an IT company hires the services of an external software development company to carry out all the tasks of the company’s software development necessities, that could have been done in-house instead. The third-party should be capable and adequately equipped to carry out all tasks as instructed by the hiring company.

Growth of Software Outsourcing

According to a study conducted by Statista in 2017, surveying CIO worldwide, it was found that software application development was the most commonly outsourced IT function. It was answered by 64 per cent of the respondents. According to a more recent report by Statista in 2019, the market size of IT software outsourcing amounted to $66.52 billion in 2019. Consequently, according to another report by Technavio about “IT Outsourcing Market by Service, End-user, and Geography – Forecast and Analysis 2020-2024”, it was predicted that the IT outsourcing market has the potential to grow by USD 98 billion during the forecast period of 2020-2024.

Implications of Growth in Software Outsourcing

Such large numbers imply that the market for software development outsourcing is only expected to grow even more in the coming years. Moreover, as more and more businesses are going digital, software development outsourcing can become the basis of their digital transformation process. With the evolution of technology at such a fast pace, it might be difficult sometimes to keep up with it. The technology of this year might become obsolete in the next. Due to such high competition, companies must evolve and adapt themselves to the changing times. It is each company’s goal to adopt a more cost-effective model, and software development outsourcing proves to be a practical and feasible approach towards that goal. Software development outsourcing has become increasingly popular due to its varied benefits, including

  • effective development costs,
  • quick access to a large pool of IT talent, and others.

Benefits of Software Outsourcing

According to a global survey conducted by Deloitte, of more than 500 companies, 93 per cent of companies are already considering outsourcing their software development needs. There are several benefits to outsourcing software development:

Access to an expert talent base:

Outsourcing software development opens up a channel where companies can get access to talent from all over the world. Outsourcing teams are thus more diverse and have expertise in a variety of areas. There is an increased division of labour. The outsourcing team is already an expert in the task and will thus help to minimize risks. Moreover, outsourcing allows the client to focus more on their business milestones.

Minimize costs:

When a company decides to disburse its business requirements to the in-house staff, it has to incur costs of recruiting, training, and paying regular salaries of in-house developers. Outsourcing software development minimizes these costs. Companies can hire experts in their required fields and invest smartly to avoid unnecessary costs.

Focus on core business goals:

There is rapid evolution of technology every day. Hence, businesses must come out with their software as soon as possible. However, it is also necessary to keep business goals in mind. Striking a balance between these two tasks can prove to be hectic. However, with the outsourcing of software development, businesses are assured that their development tasks will be performed smoothly by hired professionals. They can, thus, in turn, focus on achieving their objectives. One simple example of outsourcing is when companies hire professionals to write code to design their websites. The third-party focuses on website design and website development. Clients are assured that their web requirements are being handled efficiently, and they can move on to focus their attention on other tasks.

No skills gap:

Sometimes, the in-house employees of a company lack the specific skills required to execute a software development project. In such cases, businesses can outsource their software development needs to bridge this skills gap. This helps to overcome any and all shortcomings smoothly.

Strengthen your product:

A full-cycle company can offer various services as a part of outsourcing software development. There can be various stages of product development or service development cycle. Each team handles a separate cycle. Thus, the hired team of professionals will aim at strengthening and promoting the company’s products and services. The company can free it’s time to focus on business goals.

Swift software creation:

Outsourcing means hiring trained professionals who are experts in their respective fields. IT software outsourcing companies who hire the best experts can be sure of their talents. They know that with their vast experience and suave delivery methods, results will be delivered within the given deadlines.

Manage time and money:

Though there are various other advantages to outsourcing software development, minimizing costs is the leading one. According to various research, 70 per cent of businesses use outsourcing to develop new products.

Businesses need to make a detailed outline of their milestones and goals. And only then decide whichever parts of their business they want to outsource. Some key tips to remember when outsourcing is:

Define your goals:

Businesses need to make a clear and defined set of goals, requirements, and expectations. Accordingly, they can make an informed choice about the company they want to hire to outsource responsibilities.

Analyse your project:

To make an even more informed decision, businesses need to understand every aspect of the project. They need to assess the details. This will help to write technical implementation, fix the project boundaries, estimate the cost of development, and predict possible risks.

Explore the company:

It is extremely important to research the company that you wish to hire. Check out the company’s website, its LinkedIn profile, and then only decide to move forward. Do not hesitate to clear all your doubts thoroughly.

Discuss the project:

There is no need to rush. Arrange a meeting with the company or its representative and discuss what your project entails. This discussion can prove to be very fruitful. It can help to check their communication skills, flexibility, transparency, and the ability to speak with you in the same language.

Trial project:

If you wish to probe further, you may engage the company in a trial project. This will ensure your complete satisfaction with their kind of work. It is very important to see how they perform on a trial. This will prove whether you want to hire them or not.

ErisnTech Software Development

IT and software development company ErisnTech provides several services. They include like web development, app development, software development, UI/UX designing and digital marketing. In the field of software development, the variations provided include:

  • A one-of-a-kind learning management system to create, customize and collate courses that match the curriculum.
  • A state-of-the-art hospital management system that automates workflows, enables online bookings, stores electronic records, and delivers notifications in a completely digital environment.
  • An inventory with POS offers a full range of retail systems, helping you run your business anytime, anywhere.
  • A consolidated HRM system that encompasses all human resources into one single platform for maximizing returns on employee investment.

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