Software outsourcing or delivery team: what's best for your company

Today's business environment requires different strategies to deliver the best products and services. One such practice in use is the outsourcing method.

Outsourcing is the business strategy of hiring a party outside a company to create goods or perform services originally performed in-house by the company's staff. It is a practice undertaken by businesses as a cost-cutting measure. Outsourcing covers a wide range of jobs.

As more businesses rely on software as their primary revenue generators, executives have turned to software outsourcing. Such businesses need these firms to help them fill internal weaknesses and develop new products on time and within budget. The two main outsourcing models today include software outsourcing and delivery teams.

What is software outsourcing?

Software outsourcing is handing over control of a business's custom software solutions to a third party. The outsourced firm is often qualified to handle the required business tasks.

Software outsourcing has become one of the most crucial business strategies for achieving desired business goals and managing new trends. Outsourcing development allows management to focus on the company's long-term growth and core responsibilities.

What is a Delivery Team?

The delivery team model allows businesses to grow continually by providing experienced contractors that monitor the business's technology needs. It is also referred to as the in-house software development team. They are also responsible for suggesting improvements and immediately responding to emergencies as they arise.

The outsourcing model involves hiring a long-term extended team of experienced software engineers to handle network support, resolve day-to-day tech issues, and monitor the company's technology. It is a strategy that reduces the staff burden and helps a business grow or ensure the security of sensitive data.

How to choose the right model

Before picking any outsourcing models, the first step should be identifying the challenges a business project faces. These factors include the objectives, time, and resources of the business. One way to ascertain these factors is to carry out some market research. The idea entails looking at the pros and cons of both options and the best-suited one for the business.

Challenges of the outsourcing models

It is an easy task to find a perfect solution in every respect. However, both models pose some risks, and it's important to know them before opting for them.

Cons of the Software Outsourcing Model

Limitation of control

In the case of software, outsourcing is difficult to oversee the steps and actions taken by the outsourced firm. It also requires more work to administer their daily activities. Nonetheless, there are project management tools that help businesses to see how the developers work. It also shows how much time they spend on the project.

Security Risks

The trend of Cybersecurity risks and threats is on a constant increase. The insecurity of the digital world results in some communication failures and lack of control that undermine a company's security. However, companies need to take some technical measures to prevent information leaks.

Disruption in Communication

One challenge of software outsourcing is the inability to reach offshore vendors at the usual working hours. As a result, it slows operations when there's an urgent reason to reach out.

Cons of the Delivery Team Model

High Cost

An in-house software development team requires payment of salaries, raises, vacation days, sick leaves, insurance, and travel expenses. All these often lead to never-ending investments and extra expenditures.

Search for Talents

In today's digital workspace, there's a shortage of talent. As a result, good skills are in high demand. However, having the best professional developers at a given site requires that businesses make some offers that are difficult to reject. That is why competition for a good expert comes very strong among employers.

Brain Drain

Some companies prefer to create an in-house software development team. The risk here is that they eventually face an outflow of brainpower. This trained personnel moves to a higher paying offer at the end of their contract. Losing middle developers requires additional expenditures on finding and training the replacement. The loss of senior developers comes with great repercussions for the business. Such losses tend to affect other departments of the company and delay product deployment dates.

How to manage an outsourced development team

Establish a True Partnership

A good way to start is through effectively communicating ideas and sharing visions of the future product. It puts the vendor at ease and helps them know what to do. The company also needs to learn to discuss and accept advice on the project workflow. This establishes a cordial work environment for the outsourced projects. Finally, the business needs to treat the IT vendor as a real partner. Showing empathy to a remote team and letting them know the company cares about their growth motivates them to work more efficiently.

Eliminate Cultural Discrepencies

When hiring developers overseas, remember that they have a different culture from yours. So, before hiring a remote team, the company needs to determine whether its culture goes well with its product development culture. Be aware of a delivery team's behavior rules, communication habits, traditions, and customs. Offshore team members will help you avoid any misunderstandings.

Implement Agile Practices

Outsourcing software development and an agile methodology are the two trends in software development. The implementation of agile development requires both parties to apply the same practices and have a common understanding.

The agile practice involves open and well-tuned collaboration, trust, and taking responsibility. So, ensure that all partners in different time zones offer sufficient flexibility, scalability, and collaboration capabilities.

Use Project Management Tools

Working with an outsourced team requires a whole lot. It includes giving them precise and clear tasks, setting deadlines, tracking task execution, arranging online meetings, and more. Therefore, it becomes a matter of necessity to use management tools. Several project management software tools exist. They are simple to use and help make the process of managing outsourced projects run smoothly. The popular ones include Trello, Asana, Skype, and more.

Key TakeAway

Choosing the right outsourcing model is a challenging task. It entails factors like project requirements, an adequate budget that fits best for software development, and a deadline to make the product market-ready. There's also a need for clarity.