The benefits of software outsourcing for organizations

Organizations define software development outsourcing as the practice of hiring a third-party software development provider to complete projects, utilizing external resources. If you are concerning its effectiveness. This has become a global trend in the digital world currently due to its effectiveness. There are different outsourcing models that organizations can choose for their projects. Organizations can hire third-party service providers to develop their software and utilize their advanced technologies for their needs. Some outsource their software development and they depend on third-party providers so as to archive projects on-site. They also hire other companies or individuals to complete projects off-site.

So, why outsourcing is attractive and effective that it become a trend for a while in most organizations? Here are some benefits that software development outsourcing can bring to businesses.

Cost & Time saving

When it comes to the cost, some may think that using an in-house workforce can save more money than hiring other companies. However, outsourcing reduces more than 60% cost of workforce labor. In fact, businesses do not need to be concerned about the budget for labor while you can pay money for the right professionals. In addition, if businesses choose 24/7 support services from providers, they can save time to deliver their products or software to the market as soon as possible. Cost and time savings can be the impulse to make their product price competitive whilst there is a shorter time-to-market delivery.

IT professional talent & experience

Your outsourcing company has experts in this field and technologies to guarantee your projects are completed on time. Also, they have qualified labor to take full advantage of technologies and their experience can ensure the quality of your software.

Technological advances

As you know, technologies have always developed and evolved to satisfy the desire for change and innovation in the digital world. If you do not have expertise in technology, this will be a waste. Instead, your outsourcing companies, who have enough talents and experts to keep track of the enhancement of technologies, can analyze, estimate, and suggest appropriate ones with multiples perspectives.

Consulting & Strategy

In recent, some outsourcing companies also provided consulting services about technologies and solutions that fit your potential software or applications. By outsourcing your software development, you also receive more recommendations and advice which can contribute to generating your competitive advantage during your technological race in your market.

Compliance

One of the benefits of hiring an outsourcing company is that there is no need to be concerned about legal compliance whilst you can collaborate or indirectly hire global employees. The labor issue and paperwork are your outsourcing company’s responsibility, but they are in charge of the progress and quality of the product and service they provide.

Risk Mitigation

For a large number of talents with experience and expertise, the risks can be minimized during the progress of work. Your in-house team can understand the target, goal, and strategy of the software, however, your outsourcing experts have the knowledge and experience to guarantee high-quality project management and time-to-time delivery with risk mitigation.

Potential Disadvantages

There is no doubt that outsourcing has brought considerable benefits to businesses and it consecutively becomes a norm due to the outstanding points mentioned above. However, this solution also contains some potential challenges that have a detrimental impact on your business. Privacy and security risks are key factors that enterprises should be well-prepared for if they don’t want their confidential information and data to be disclosed. Simultaneously, if enterprises and your outsourcing do not well collaborate and communicate, this can lead to the misunderstanding of organizational structure and business goals. Moreover, timezone and language are other important challenges if they work with international outsourcing companies. These issues can be resolved but it takes time for both sides to overcome.

Tips for outsourcing

Challenges are not able to completely avoidable, but there have always been solutions to mitigate risks and issues that most enterprises have faced when they decide to hire a third party for outsourcing software development. Here, we suggest some tips that would be easy to apply through these real cases.

– Agile Scrum Methodology

Agile Scrum methodology is a popular practice to help both outsourcing companies and enterprises well manage and keep track of progress. This article will not discuss details about the Agile and Scrum master, but you can refer to more information here. In contrast, your outsourcing companies must have knowledge and experience of how to implement the methodology in the projects’ life cycle. Experts recommend this method because it enables product owners and developers to collaborate and manage the product, even if they do not work in the same office. In contrast, the owner can track the sprints, which are essentially weekly tasks and features in the product’s cycle, and compile all sprints to gain a comprehensive understanding of the project’s progress. Not only the owners, but the entire team can also overview and keep up with all changes in the project to ensure goals are achieved.

– Use project tools

In the digital world, it is not difficult to find a project management tool that can support users with multiple automatic features so that they can multitask with their projects. In general, one project tool can help users to manage, prioritize, and assign tasks to members. They also can notify activities or automatically send emails to teams about new updates. To make project management simple, users have to upgrade to be able to use for Agile Scrum methodology. Trello, Asana, and UpDiagram are ideal options for developers and other businesses as well.

Conclusion

To sum up, outsourcing software development has brought benefits to businesses, but it is undeniable that the pros and cons go hand in hand. Hence, before deciding to hire an outsourcing company, you should ask them about their plan and solution for any challenges and issues occurring in the project management process. Additionally, your business should have a plan to define the best fixed outsourcing company based on their technical expertise, experience, background, and other relevant performing for the needed tasks.