How software development outsourcing can benefit you

According to statistics, more than 300,000 software development projects go annually to outsourcing only in the USA. And the numbers continue to grow. The reason for such huge popularity of outsourcing contracts lies in the benefits they provide for the companies.

In this post, we will cover top 5 benefits of software development outsourcing that make it so popular.

Expansion of your development options

When you decide to exploit an outsourcing model and build a solution with a third party, many doors open to you.

First, you get an advanced choice. To clarify, you get access to a large pool of developers not limited only by boundaries of your country but from all over the world, thus you are able to select a company that tallies with all your requirements to hand over software development.

Second, you get deeper expertise, both industry and domain, for your project. In case of outsourcing, your capabilities are not limited by the skills and expertise of your in-house developers (if any).

Third, you get greater flexibility. For example, you can partner with a Python company for your Python project, a Java company for your Java project, etc. Besides, collaborating with your employed developers, they can make out more valuable solutions.

Savings on labor costs

It would be great if a program could build another program fully tailored to your needs. However, it is still people who develop apps and other IT solutions. That is how labor costs appear. These costs can be very high if your company is located in a country with high labor rates and hires skilled developers to work on your software development project as a member of the staff. Especially, if the company pays good salaries to its employees.

Still, there are plenty of countries and companies where labor rates are much lower. And this is where the first advantage of outsourcing arises. Thus, when you outsource your project to a company with lower labor rates, you significantly reduce project labor costs.

Other advantages here are the following:

• No need to pay your engineers for increased duties in case one of them gets ill and can’t work on the project for some period (or higher one more developer to replace the sick one). With outsourcing, you just pay for the job to be done, even if you use a time and material model.
• No need to incur vacation pays concerning a team engaged in the software development project.
• At last, with outsourcing, you don’t have to pay for the team downtimes as well as for the downtimes of its individual member.

Savings on overhead costs

Overheads are expenses apart from salaries and other benefits to software developers engaged in the project. It accompanies your needs to:

• Onboard and manage engineers (including running training courses, various team-building campaigns, etc);
• Provide appropriate technical equipment to ensure seamless project pipeline (rent facilities, purchase computers, etc);
• Handle payroll and insurance duties (including extra expenses for accounting services).

Outsourcing enables you to exempt yourself from these overheads as it is an outsourcer’s responsibility to build a team and provide them with an appropriate environment.

An increase in KPIs

Typically, with outsourcing, you can get higher Key Performance Indicators (KPIs) associated with the project. These indicators can be divided into two groups:

• Software metrics (code and testing quality, solution availability and security, etc);
• Team productivity metrics (velocity and cycle time, flow efficiency, etc).

The foundation for high KPIs lies not only in good skills of the engaged developers, though this is an important factor, of course. In other words, would they have poor proficiency, they couldn’t in all countenance reach great results.

Besides, they are greatly interested in a long-term partnership with you. The competition in the software development market is fierce. That is to say, an outsourcer perfectly understands his being just one of the options you have on the market. Therefore, guys do their best to keep you satisfied and provide results that meet and exceed your expectation.

A shorter path to market

At last, outsourcing significantly reduces development timelines.

First, it takes less time to find a team to build a solution you need or handle certain tasks such as, for example, QA. Therefore, you can start your project right now instead of some other day.

Second, a software development outsourcer is an expert in the domain and technology you are interested in. Therefore, they may already have mature solutions and ideas to implement in your exact case. And, now and again, they know how crucial for future success to be proactive and intensive to build a product you need within the deadlines you set.

Thus, with software development outsourcing, you can make out a valuable solution much faster without overpaying for it.