Outsourcing has become a buzzword amongst software, technology, and IT companies worldwide. The word itself came into extensive use in the early 2000s with the dot com bubble; many internet companies were ‘outsourcing’ software development jobs to places worldwide to reduce labor costs.
Outsourcing essentially means giving a part of your work to someone (like a software development company) and ensuring that they follow the requirements and processes that make your business better, faster, and reliable.
Why do businesses outsource their software development?
Initiated by a shortage of software developers in the US in the early era of internet companies, businesses began outsourcing their development work to countries with more people and less labor costs. This included Asian countries like India, China, Singapore, and others. People found that outsourcing brought immense benefits in addressing developer shortage and effective cost management and increased productivity.
While this trend had initially developed due to several factors involved, gradually over the years, the pattern gave rise to a whole new sector and companies whose primary job is to do outsourced work. And since the growth of the software market, many businesses found a useful and cost-saving way to build more products in a short period.
This has led to an increasing number of startups, small, and medium businesses outsourcing their development as a part of their strategy.
If you are planning to build an application for your business and want to choose which software development company you should choose — read on to understand what strategies you should keep in mind.
Strategy 1 – Identify what part of a business function to outsource.
You might be a new business or status, and that doesn’t mean you have to outsource your entire business to another company. An effective strategy to tackle this is to choose which part of your business is labor-intensive and how you can outsource that part of your business. Now, this can come in three different sections.
Outsourcing your application development — You might be looking at outsourcing your application development because that needs a lot of development process, including system architecture, low-level coding, quality assurance, and deploying additional features that make the application stable and functional.
Outsourcing your system integration process involves connecting an existing application or physical application to various other apps to create a complete system. This is done to achieve specific functionality.
Outsourcing your database management systems – A service provider, in this case, organizes, updates, and maintains data processes.
Once you’ve identified which part of your business you’d like to outsource, the next steps involve deciding the outsourcing model.
Strategy 2 – Choosing the outsourcing model
An effective strategy involves choosing the right outsourcing model for your business; this can be categorized into three parts.
Onsite model – In this model, a group of talented software developers/programming engineers is situated on the customer’s premises and discusses carefully with them. The on-location cooperation goes from information gathering to deployment. The on-location group additionally works close to the customer’s representatives, and this works best for customers who need direct correspondence. With this model, it becomes straightforward to execute changes in the undertaking when required.
Offsite model – In this model, the specialist co-op for an offsite model lives close to the customer. An offsite specialist doesn’t need to work within the customers’ organization and can work outside the premises, yet their office is situated close to the customer. This model works best if the undertaking prerequisites are not exhaustively characterized.
Offshore model – This model is called the remote working model, and unlike On-site or Off-site, a specialist doesn’t need to be anywhere near the customer’s location. The software development company can be outside the country or region of the customer. In utilizing this model, the customer gives a point by point venture necessities to the development team, and they work with that brief. Since the offshore teams are found nations away, individual connections between the specialist organization and the customer are nearly impossible. The two gatherings impart through email, telephone, and video calls.
As a business, you can also implement a combination of the three models highlighted above.
Strategy 3 – Deploy which outsourcing strategy works best for you
As a business outsourcing your development work to a third party, it is essential to identify its metrics. The best strategy for outsourcing is to choose a part of your software development process and work with an external company to get it done.
This has two-fold benefits — one; you get access to a global and specialized talent pool that you might not find in your country and two; you see them at a much lower cost, making all possible without compromising on quality.
Several nations throughout Asia and Latin America and others have a vast pool of talented engineers and developers who can work productively and comply with your business needs. So deploying the best match of outsourcing strategy that suits your budget, quality, and choice of the region will benefit you in the long run.