IT Outsourcing: How to Choose the Right Software Development Company

Outsourcing software development takes place when companies grow and no longer have the internal bandwidth to manage certain tasks and operations. Other motivations for outsourcing are to reduce costs, increase efficiencies, enhance customer service, and more. When embarking on a new business initiative, it's critical to have the right team in place and hiring a software provider isn’t a decision to be made hastily. It is imperative to consider whether potential providers have the technological expertise for the scope of your project; a proven track record; and an interest in building a solid working relationship to augment your present workforce.

What Kind of IT Outsourcing Is Right for Your Business?

Location-based Outsourcing

This framework focuses on the location or distance from your service provider:

• Onsite Outsourcing: In this model, your outsourced team reports to your office and works alongside in-house employees. Having outsourced staff on location speeds up learning processes and working within the system.

• Onshore Outsourcing: Under this arrangement, the third-party partners work in the same state or country, allowing for minimal cultural and language differences.

• Nearshore Outsourcing: This model seeks providers in neighboring countries that are often in the same time zone. There may be some linguistic differences, but most businesses looking for nearshore partners are seeking a more affordable solution.

• Offshore Outsourcing: To save even more money, a business might opt to outsource to more distant locations.

Relationship-based Outsourcing

With relationship-based outsourcing, there is a focus on ownership and responsibility and how the third-party provider handles these two principles.

• Staff Augmentation Model: This model is similar to onsite outsourcing. The outsourced team joins your in-house staff to manage programs internally. The client has full control over the projects from beginning to end.

• Managed Team Model: Under this arrangement, both the provider and the host company share responsibilities and designate who focuses on what tasks. The client also has control over the team.

• Project-based Model: The third-party owns the project after the company informs them of the requirements.

What to Look for in a Software Development Company?

Whether you’re intending to hire a team to build a custom solution from scratch or acquiring outsourced resources to augment your team, choosing a software partner that best works for them and their specific customers' needs.

can be quite the challenge. Entering the wrong partnership can lead to delays, wasted funds, and poorly built solutions. When considering a provider, it would be wise to be on the lookout for the following qualities.

Comprehensive List of Services

One of the initial steps in hiring an IT provider, is understanding what your goals are and what you would need to get there. Having this in mind will help with assessing and comparing teams; are they sufficiently equipped to take on your project? You can start by asking about the structure of their teams. Are they providing project managers, designers, developers, and quality assurance specialists? It would be ideal for solution providers to house a wide range of internal teams and talent. This way you don’t have to worry about paying for additional services.

Diverse Technical Skills and Domain Expertise

Technology is vast and there is a plethora of tools, platforms, and programming languages one can use to develop software. Developers today should be aware of the resources at their disposal and should be able to choose the appropriate stacks for the scope of your project. Businesses seeking to outsource work should avoid software companies that can only work within one type of architecture; there is no such thing as a one-size-fits-all solution when developing products. In addition, while it is great to work with a company that has worked on a similar project as yours, it would be ideal to find a team that specializes in the same field as the final product.

Understands Business Objectives and Bottom Line

Prior to committing to a particular company, it is important to align on business goals, ensuring all parties are on the same page. The business world is much more dynamic compared to a decade ago, and custom development companies must understand your short and long-term goals.

Effective Communication

One of the most important qualities providers can have is effective communication. Miscommunication and lack thereof can gravely impact the project’s progress and the final product. Communication is essential between the outsourcing house and the business as openness and transparency is fundamental to a project’s success, mitigating potential misunderstandings. You can ask questions and initiate discussions to ensure that the project is progressing in a way that you understand and optimally meets your business goals.

Prioritizes UX/UI

Many software development services providers focus on design while others focus on technical services. However, prioritizing one over the other can be detrimental in the long run. Business leaders must seek a development company with experience in both technical assistance and providing UI/UX development solutions. Creating intuitive and user friendly solutions makes for a successful application that is better received because users are your market. Giving precedence to UX/UI helps you meet your business goals, reduce costs, and save times time in the long term.

Quality Assurance

There is an inherent difference between “quality assurance” and “testing”. Including a QA team in the software development process to identify vulnerabilities developers might miss, indicates a dedication to detail. Tools such as Agile and DevOps focus on iterative releases, allowing for an ongoing feedback loop. This loop should include ongoing validation stages, including user testing, daily scrums, and prototyping.

Certifications and Accreditations

When your company is ready to invest in a software development company to partner with, it would be wise to validate their performance claims. Being able to showcase skills and abilities is one of the best ways to confirm capabilities. Seek certifications such as Oracle, Salesforce, Amazon Web Services, and Microsoft.

The Pricing Model

There are a few types of pricing models typical in the software development industry, fixed price and time and material. Deciding on which model would be right for you is largely depends on your specific project type. With the fixed model, you’re losing a bit of flexibility, whereas the other option allows you to pay for work as the project progresses.

Choosing the Right Software Development Company for Your Project

The stakes are high when entering a partnership with a third-party provider. Badly built software costs you more than financial losses (repairs, correcting errors, redesign). Your reputation is also on the line, which can negatively affect your bottom line. Meticulously vetting potential partners is a critical step that shouldn’t be overlooked, choosing the right provider makes all the difference to success. It is important to work with companies that will deliver software solutions that exceeds expectations in every area.