In this article we’ll dive into how globalization and the increase of remote work has made it easier than ever to outsource your software development company. We’ll discuss the benefits of outsourcing including cost, time, quality, scalability, mental health and perks.
Outsourcing is a popular business strategy that’s been used as a method for companies to take over their competition. The process of outsourcing involves an external company doing some or all of the production or operations work for another company.
Tasks that could be outsourced include, but are not limited to, payroll services, website design, graphic design and product development. The benefits of outsourcing can range from cost reduction to increase in focus.
What is Outsourcing?
Before talking about the benefits of outsourcing let’s first discuss what it is. Outsourcing is defined as “trading work outside one’s own country” or “the practice of employing workers in a country other than one’s own.” A software development company can outsource business functions such as customer service, finances and software development. It is estimated that 80-90% of companies outsource work at some point.
Here are a few benefits of outsourcing your business:
- Cost Reduction (including an ROI): The cost of software development can be reduced by outsourced work. Since software development is started and finished at different times, dividing up the work between several developers can slim down costs (and increase profits). The time needed to complete outsourced tasks is also cut in half.
- Increase Focus: When you outsource your staff to a company outside your company, you will have more of a focus on what’s important, such as coding or customer service. Outsourcing will allow you to focus on the tasks that are most important for the success of your business.
- High Quality Custom Software: You can get high-quality software developed when you hire a talented team that cares about their work, which is not something everyone can say about their own developers. Top talent is difficult to find without having a large budget to pay notoriously high salaries. That’s why outsourcing is an ideal strategy for companies who can’t afford the most talented developers.
- Scalable and Sustainable: As your business grows, so does your software development company. You can outsource more of your company’s work while still keeping the same size staff of developers or even growing it. This way you will never have to worry about exceeding the capacity of your staff members. Scalability will not be an issue with outsourced software development.
- Increased Profit: Since outsourced software development is cheaper than in-house staff, you will end up with a higher profit margin.
Defending Against Outsourcing
When considering the idea of outsourcing, there are several ways to increase the risk or decrease the benefits. To make sure that you don’t outsource your company’s important functions, protect yourself by looking into the following recommendations:
Firm Up Your Contract: Here are a few things that may be missing from a contract between you and your outsourced software development company. Before signing any contract with an outsourced developer, ask for names and email addresses of their team members along with a list of their current clients. Be sure to check out references before hiring anyone.
Inquire About Quality: Ask the developer’s current clients how happy they were with their work and whether the project was completed on time. You can also mention that you are having a hard time finding good staff to help you grow your company. This will help you understand more about the quality of their product before you hire them.
Keep an Eye on Your Budget: It’s not uncommon to find that an outsourced company charges more for a project than your in-house staff members are currently charging, or even more than what it would cost to hire new employees. If this is the case, try and negotiate by looking at lower prices for different features, or even look at adding extra features when hiring your employees back.
Don’t Tell Anyone Else: Outsourcing software development is one of the worst things that a software development company can do. It’s common to find software development companies that have been victims of outsourcing in the past. If you’re considering outsourcing, don’t let anyone else find out or you may end up with them.
By following these few tips, you can help prove to the outsourced software development company that your company is worth hiring again and they’ll be more likely to feel comfortable bringing them back for new work.
Hopefully this article has shed some light on outsourcing and the benefits of it. As a software development company, it’s important to look at every option for growing your business. One way to do this is by outsourcing some tasks to help you focus on what’s important in your company and grow more efficiently.