Software Development Outsourcing: Top 11 Tips For Effortless Management

Choosing a software development company to outsource your project might be a hectic and confusing task for your business. However, software development outsourcing is a growing trend in the present-day scenario. Today, software development is in high demand with the rapid digitalization of the entire world. Eventually, the software development cost is rising at one hand, and the company, over-burdened with multiple projects tend to delay the development. 

However, outsourcing companies offer much more cost-effective and faster development processes and have emerged as a boon for the IT world. However, outsourcing software development is a chaotic process as you can not choose any company randomly and need proper intellect and research. Well, to cure your chaos, we are introducing a complete guide to software development outsourcing and sharing the top 11 tips for the successful management and execution of the outsourced project. 

What is Software Development Outsourcing?

Before discussing the tips directly, let us first understand software development outsourcing in brief. When rather than developing a software product in-house with your IT team, you hire another IT company to work on the project, we call this project software development outsourcing. A company may outsource an IT project for various reasons. Say, for example, some of the reasons may be: 

1. Not being a business in the IT domain and eventually not having an in-house IT team.
2. Insufficiency of skilled IT professionals and inability to hire new developers for a temporary project. Say, for example, need a project in ReactJS, but have ReactNative developers only in-house. 
3. Having too many projects to develop, and therefore outsourcing less important projects to some other company. 
4. When a company does not get budget-friendly services in its own country, then they prefer to outsource to a comparatively less rich country to save the cost. 
5. Likewise, when a country or region lacks skilled, trained, and educated developers, then they prefer to outsource the software development project to some other country that has sufficient and eligible resources. 

Furthermore, there might be some other reasons as well. So, for a successful software development outsourcing, it is important to first know the methods of outsourcing. It will help you choose the best type of outsourcing services for your business as per your comfort zone. So, let’s scroll down and understand the types of software development outsourcing first. 

Types of Software Development Outsourcing

Mainly, there are 5 types of software development outsourcing services on the basis of hiring model and location. We can understand the software development outsourcing types below: 
 

Onsite Software Development Outsourcing or Staff Augmentation

The first option is to outsource the software development onsite. Onsite software development is the process when a company hires (or borrows) a developer or the entire software development team for a particular period of time. In this case, the developer or the team will visit and join the existing IT team of the client and fulfil a project. Usually, the developer outsourcing companies would send their teams or individual software developers to fulfil your project. 

Onshore Software Development Outsourcing

Another option is onshore software development outsourcing. In this case, a developer or the team does not visit the location of the client. Rather, the client provides entire project details to a service provider or outsourcing company. Then, the outsourcing company can develop the project at their own location. However, in onshore software development, the client and the service provider will share the same country. 

Nearshore Software Development Outsourcing

When the client outsources the project to a company located in the neighbouring country, then it becomes nearshore software development outsourcing. Just like the onshore outsourcing, in nearshore outsourcing as well the developer can work remotely at his/her location. 

Offshore Software Development Outsourcing

In the case of offshore software development, a client chooses an outsourcing company based in some other country. Offshore software development is also a remote service and the outsourcing company will work on the project at its own location. 

11 Tips for Better Management of Outsourced Software Development 

So, having understood all types of software development outsourcing methods, now you are wise enough to choose the right model that fits your project requirement, trust level, and budget. However, whichever outsourcing model you choose, you can follow these tips: 

1. Conquer The Linguistic Barriers 

Software development outsourcing often comes with linguistic barriers. It is because, to save cost, a company usually prefers an outsourcing company from a region, city, or country where labour is talented and the value of Dollars and Pounds is highest. In this way, the client gets quality services at affordable prices. However, make sure that whichever country you choose, they must be able to understand and communicate properly in your language. 

Suppose, your native language is British English, then the outsourcing country must be able to communicate at least in common English fluently. In this way, you will be able to share the project details and take the reports hassle-free. 

2. Document Everything Clearly 

Furthermore, no matter how proficient a country is in your language! Your language is native to you and a second language for the outsourcing country (if outsourcing offshore). Eventually, there are possibilities that the accent of both, the client and the outsourcing company might hinder the communication. 

Therefore, document every detail of the project. Written communication will help the software developers understand the project requirements better and perform the required tasks in a more comprehensive manner. 

3. Establish a Rapport With the Outsourcing Partner 

Moreover, always establish a good rapport with the outsourcing partner. In the case of outsourcing, the service provider may be nervous due to linguistic, cultural, and attitude differences. However, you must make your outsourcing partner feel comfortable so that you can communicate freely with them. 

Also, establishing a rapport with the outsourcing partner will also encourage them to connect with you from time to time whenever they face an issue. This will bring transparency in the software development process and you will get a clear report on the progress. To establish a rapport with the outsourcing partner you can: 

✓ Connect over the video conferencing and keep your cameras on. Also, ask the outsourcing partner to keep the cameras on so that you can get a face-to-face meeting virtually. 

✓ Introduce yourself well and be more friendly than being strict and professional.

✓ Ask questions like ‘How are you doing’, ‘What’s going on these days at your place?’, ‘what’s the weather there?’ etc.

✓ Praise anything you like about the outsourcing partner. It may be their energy, smile, or way of conversing, or punctuality. Alternatively, you may praise what you see behind them. It may be a flowerpot, a painting, or anything special about the interior. 

Now, you have made them comfortable. Good Job!

4. Keep Communicating With Them 

Once you have finally outsourced your software development project to a company, it is important to keep a check on the project. During the contracting phase, make sure that you mutually agree upon and sign a pact in which you have decided to connect periodically to discuss the project update. 

The best approach is to connect weekly over Google Meet or Zoom Call. By sharing screens you can see the project development in real time. Moreover, if the outsourcing partner is a newbie and lacks sufficient experience, then you can also connect daily. 

Connecting on a regular basis to share the progress report will help you control the project better. You will identify and rectify the errors earlier. It will lead to smoother software development

5. Do Company Research Before Choosing 

Moreover, as you have decided to outsource the software development project you have, do not choose a company randomly. Rather, do complete and robust company research before making a decision. Before choosing a company, check the following resources and cross-check by connecting with the company over a call or Google Meet: 

✓ Make sure that you check their official website thoroughly. The website must have a valid:

✅ Contact Number

✅ Registered Office Address

✅ Detailed Privacy Policy Document

✅ Client Testimonials (if present) 

✓ Check their Google Ratings and Reviews. What their other clients are saying about them will help you make an informed decision. Google reviews are the most authentic source. 

✓ See their social media presence and analyse their activities on the same. Check their social media comments on their posts and their client activities on their social media pages. It will help you understand their authenticity to a good extent. 

6. Try to Outsource Software Development Onshore 

Furthermore, to ensure smooth and better management of the outsourced software development process, we would suggest to opt for onshore software development outsourcing. It is because when you share the same country, you are less likely to suffer: 

❌ Communication Barriers

❌ Currency and Payment Transfer Issues

❌ Time Zone Variations

❌ Physical Distancing Issues

Now suppose, there is a technical glitch while connecting through the Google Meet or Zoom Call. Then, the communication will suffer! Eventually, the chances of project delays or flaws will increase. Similarly, if international bank transfers have any technical glitch, the payment would suffer. Eventually, the outsourcing partner may delay the project knowingly. 

On the contrary, suppose you are in the same country. Then, at the time of glitches, either of you can travel to the other’s location and complete the project without wasting much time. However, travelling between the countries is more expensive and is also subject to the prevailing political conditions sometimes. 

7. Choose a Developing Country When Outsourcing Offshore or Nearshore 

However, you have to save a lot of cost and you can’t afford software development in the native country or expensive countries such as the UK or the USA. Then, choosing a developing company like India, China, Brazil, Mexico, and South Arabia can be the perfect choice. 

In developing countries, it is much easier to find highly skilled resources at affordable prices. Therefore, whenever choosing offshore or nearshore, opt for web development outsourcing companies based in developing countries. It will save a lot of cost for you without compromising the quality. 

8. Do The PESTEL Analysis

Most importantly, whenever you are outsourcing the software development project to a region not native to yours, then you must do a detailed PESTEL analysis of the region where the outsourcing company is located. Ohh, not aware of PESTEL Analysis? Well, let us explain. PESTEL analysis is an environmental analysis of a place that covers: 

           ✅ Political Environment: 

Politically, both regions must have good relations to avoid any future glitches. For example, remember how India had banned TikTok and so many people ended up being jobless. Likewise, China suffered a big revenue downfall. So, such matters must not happen for the smooth execution of the outsourced software development project. 

✅ Economic Environment: 

The economic environment of the outsourced region must also be stable. An unstable economic environment opens the gateway for various associated problems. A country which is economically not doing well can experience high fluctuation rates of inflation and a lack of supporting technical infrastructure. Eventually, this hinders the software development. 

✅ Social Environment: 

The social environment includes the behaviour of the society. Always choose a country that has a good literacy rate. When a country is socially amiable and easy-going, then getting a smooth development is a guarantee. On the contrary, in a country where most of the time the society demonstrates discriminatory, intolerant, and religiously hustling behaviour, the project might suffer delays due to worker strikes, or the careless attitude of the developers. 

✅ Technical Environment: 

Most importantly, cross-verify the technical environment of the region. Make sure it has stable networks and well-built infrastructure for the smooth execution of the software development project. If a region suffers regular network issues or poor IT infrastructure, then clearly, your project is not reaching you on time with the expected quality. 

✅ Educational Environment:

The education system and literacy rate of the chosen software development outsourcing company must also be good in condition. If the educational environment is not good in that particular region, then how will you get good-quality software developers? So, make sure to choose a company which is located in an educationally elevated environment. 

✅ Legal Environment: 

Furthermore, the legal environment of the region must also be sound. Otherwise, if you outsource your project to a company situated at a place where worker strikes, political riots, and corruption rule the region, then you are landing in hot water. Your project will suffer delays and bad quality, and you will even not access legal remedies the way you must. 

9. Be Nice and Do Not Try to Dominate 

Next, always be nice to the outsourcing partner. If you interfere too much after the outsourcing do no let them work at their own pace. Then, it will disturb their timeline and hinder their concentration. So, do not try to dominate them even if they are from a developing region. You must not try to flaunt your superiority. Furthermore, if you have outsourced the project to reduce your workload, then there is no need to take any load after outsourcing. 

10. Make Provisions for International Payment Methods 

Usually, when it comes to payment when you have outsourced the project nearshore or offshore, then having a common payment method is often a problem. Either you pay high commissions and end up paying out of budget, or the payment gets too delayed. 

Eventually, before outsourcing the project, do some research on international payment methods. And mutually agree upon a convenient payment method. Mention these terms and conditions in the contract and sign it with the outsourcing company to avoid future clashes. 

11. Always Have a Backup Plan

However, software development outsourcing is a safe and secure method to get affordable and good quality software development services. But, uncertainties are uncertain! Therefore, you must always have a backup plan and that too must be documented. 

Keep strict terms for the project failure and make sure that the chosen outsourcing partner fears project failure. For example, you may put hard penalties on the delays. Also, counter-sign all the pacts necessarily. This will keep the outsourcing partner self-motivated to complete the project on time. 

Final Remarks 

So, software development outsourcing can be a boon for your project. You may outsource your software development onshore or offshore. However, when choosing an offshore web development, be sure that take sufficient care of linguistic barriers, time zone differences, cultural differences, and PESTEL factors. Moreover, while outsourcing your project finally to a company, never try to dominate them. Rather, establish a rapport and offer them a great partnership experience. Furthermore, always connect with the company virtually or in person and communicate openly with the staff to judge their authenticity, skills, and knowledge. This way, you can have a smooth outsourcing experience.  

FAQs

1. What are the benefits of outsourcing software development?

Software Development outsourcing has a plethora of benefits for a company. Some of the anecdotal benefits of outsourcing types include: 

Onsite Software Development Outsourcing / Staff Augmentation

• Meeting with a different team of software developers leads to an exchange of knowledge and skills between the more experienced and less experienced teams. 
• The project development speed increases.
• Better monitoring and control over the project.
• Saves hiring costs.

Onshore Software Development Outsourcing 

• Reduced cost of development by outsourcing the project remotely.
• Less burden on the in-house team about development.
• No linguistic barriers.
• No timezone barriers. 
• No payment method issues.
• Easy to connect in person as and when required.

Nearshore Software Development Outsourcing 

• Competitive prices.
• Less timezone issues.
• Cost-effective solutions.
• Enhancement of knowledge and skills for both partners.
• International exposure.

Offshore Software Development Outsourcing

• If outsourcing to a country where the inflation rate is less than native, then cost-effective solutions.
• On the contrary, if outsourcing to a country more developed than the native, then higher quality of services. 
• International exposure.
• New skills and knowledge gained. 

2. What challenges can I face while outsourcing software development? 

Software development outsourcing also comes with certain challenges. Say, for example:

• Linguistic barriers (in the case of nearshore/offshore outsourcing)
• Timezone differences
• Hindrances in the project due to the above two factors may lead to project delays.
• Lack of control over the project after outsourcing
• Code security and confidentiality might suffer
• Once outsourced, the client might become a puppet in the hands of the outsourcing company.
• Payment methods are a challenge for international payments. 
• Background check of the outsourcing company.

3. Will my project remain safe while outsourcing software development? 

Well, to ensure complete data security and confidentiality of the project while outsourcing software development, make sure that you sign an NDA with the company. Furthermore, do a robust background check for the chosen company and ensure that they are genuine. Rest, data safety is somewhat at stake while outsourcing software development. However, if you proceed with caution, then you will be able to find the right and ethical company for your project. 

4. How much does it cost to outsource software development?

Software Development Outsourcing Cost in the UK depends purely upon the project requirements. In general, software development outsourcing may cost between £10,000 and £500,000 depending upon the software type. While a web application might cost less, if you wish to get enterprise software tools such as ERP and CRM, then it will cost high. Whereas, app development outsourcing comes in the mid-range.