Software Company vs. Digital Product Studio. What’s the Difference? What Questions Should You Ask?
When you’re looking for a company that is developing software for web & mobile apps, you can bump into different descriptions and be confused like in Minotaur’s Labirynth.
Mostly it could be a software company (aka software house) or digital product studio. Which one will be better for you? What’s the difference between them? Or maybe it’s just two names for one thing like Snoop Dogg and Snoop Lion?
You’ll identify the tree by its fruits
We’re 10 years on the software market as Untitled Kingdom, so we can see that there could be many differences between the work of a software company and digital product studio. How to see it with the naked eye?
What’s important, it’s often not a case of a name or description of a company. You can be titled and talented as Jack Nicholson and say that you’re still learning. On the other side, you can be just Ordinary Joe and say that you’re the best. The truth is, you’ll identify the tree by its fruits.
It doesn’t matter what they do, but why and how they do it
It’s significant that I can’t tell you that software house is a bad choice or digital product studio is an excellent choice and vice versa. It depends on different factors and most of all, a mindset.
I aim to present you most common differences, but YOU need to decide what’s the best for your business and attitude. You must also assume that this article is based on generalization and approximation.
I try to be objective but at Untitled Kingdom we walked the path from the software house to a digital product studio. That’s also why we know the differences very well.
How to choose a software company that fits your needs?
Without further admission, I’m going to introduce you to my simple comparison that shows mostly workflow, methodology and approach differences, according to a brief. I focus on the most essential points: money, people, time, engagement, quality, result, relationship, and vision.
Money
SOFTWARE HOUSE
The software is not the core of your business. To work with an average software company, you don’t need a lot of money (relatively). You fill the brief and wait for an estimate.
DIGITAL PRODUCT STUDIO
Web or mobile app is very essential for your business so you treat the development process as an investment. You expect the best possible quality and teamwork.
People
SOFTWARE HOUSE
You pay for a developer who does what you want him to do. Don’t expect many suggestions or added value from seeing a bigger picture. You also may expect junior developers assigned to your project and a little experience. Ask about it.
DIGITAL PRODUCT STUDIO
You pay for a collaboration of the whole interdisciplinary team, e.g., including senior developers, a project manager, a product owner, a product designer, CTO, QA. They look from different angles on a project, and they all have experience from several dozen shipped projects.
Time
SOFTWARE HOUSE
It’s difficult to say whether deadlines are real. Just one or two developers work for you; no one is questioning their work. Speed is what matters the most because time is money. If you don’t pay attention to the quality of the code, it could be the solution for you.
DIGITAL PRODUCT STUDIO
A team starts with a strategy workshops to level up the knowledge, validate the idea, verify market fit and design a roadmap of architecture. Then we code and test as a team on a daily basis to give you the best possible result. It lasts but it’s a productive and very crucial time.
Engagement
SOFTWARE HOUSE
Mostly you don’t need to devote much time to the software project. You filled the brief; then you expect the results. Time can be planned not very well, and you can often be a part of conversations that don’t matter. It’s not a principle, but it usually happens.
DIGITAL PRODUCT STUDIO
You need to be prepared for sharing some time with a product studio on a daily basis. There will be a strategic workshop and effective daily calls to check out if we’re on track. There will be meetings to get to know each other and to give value one another.
Quality
SOFTWARE HOUSE
It’s a lottery. You don’t know what quality should you expect. Especially when only junior is working for you or someone busy.
DIGITAL PRODUCT STUDIO
You work with professionals in every detail, so that you can sleep like a child. It’s the best quality of teamwork. It’s all well-prepared and tested long enough.
Result
SOFTWARE HOUSE
Software houses often have little flexibility, and they rather stick to the plan. Everything is prepared like it was said on a briefing. Even if new circumstances arise, the project is evaluated as it was at the beginning. Don’t expect other results.
DIGITAL PRODUCT STUDIO
Digital product studios tend to have considerable flexibility. The result is different than you expected because a product company brought value: they tested, experimented, learned. But you won’t be surprised — it’s all consulted on a daily basis with you.
Relationship
SOFTWARE HOUSE
You prefer a client-supplier relationship. You’re the boss, you know better, and supplier is afraid of losing you. You don’t have time for a supplier, and you don’t pick up your phone often. You’re focused on the implementation of a particular task, and you finish cooperation without hard feelings.
DIGITAL PRODUCT STUDIO
It’s rather a partner-partner relationship. You work arm in arm with your product studio. You share time for quality meetings and some extra time to get to know each other. It’s win-win cooperation. You invest your time in a relationship, so you want to cooperate and to partner permanently.
Vision
SOFTWARE HOUSE
A software house just wants to earn more & more money. Revenue is the most important thing, so a software company is focused on taking as many projects as it can (or even cannot).
DIGITAL PRODUCT STUDIO
A digital product studio wants to create something world-changing, important or different. That’s why the money is a side effect of work, not the aim both for founders and people.
Summing-up
To summarize this comparison, if you have an undemanding project, that is not a core of your business, and you don’t have a lot of money, probably a simple software house is an excellent choice for you. It’ll be good for you also when you want to develop some MVP quickly, but be aware of the quality of code and limited possibilities to change or evolve it.
If you have a difficult project and want to have well-thought MVP to start a business, a digital product studio could be a better choice. Additionally, money is not a problem for you, but you expect the best possible quality and support of a team of interdisciplinary specialists. You don’t need to worry about developing web or mobile app, the code is well prepared and tested for it.
What questions should I ask a software company to check if it’s a good fit?
I’ll show you what to ask and what answers will suggest if the company you’re talking to is a software house or a digital product studio.
Money
- How much does my project cost?
- How reliable is an estimation?
If a company gives you a fixed price and estimates very quickly, it could be a software house rather (but not always). A product studio will probably ask about the details of your idea to check how many people and how much time does it need.
People
- How much experience the developers have?
- How many projects one developer has?
- How many people do you employ?
- How many projects are you developing right now?
- How many developers are assigned to a single project?
If the company omits or generally talks about experience, probably there’s little and employs mostly juniors. If one developer works on a few projects, they couldn’t be challenging. You’re talking with an average software house. In a product studio, it’ll be one or two developers assigned to one project to provide continuity of knowledge. A product studio has nothing to hide because they choose you as well.
Time
- How long does the development take?
- Can we accelerate it?
- How long my app will be tested?
If the development is quick and you hear that a software house can do everything to accelerate the process, be aware. When the quality is the primary value, developers need time to code correctly, to review and to test the app. When your idea is bad, you’ll hear it from a product studio. A software house couldn’t have the courage to say it.
Engagement
- How much time do I need to devote to you in a day/week/month?
- How many meeting do you plan in the development process?
If you’re not needed in the development process, or daily/week calls are not productive, be aware of that software house. The result of its work may be very accidental, not planned. A digital product studio doesn’t start its work without knowing you and your product very well. That’s why it leads strategic workshops and the process of getting to know each other is longer than the average.
Quality
- What’s the quality of the code?
- What if I possibly would continue the work with another company?
- Who is watching the project?
- How many people will be involved in a project?
Wait for examples of well-done or transmitted projects. Ask what the process was. In a digital project studio the project is watched by an interdisciplinary team, that adds value not only to your software, but also your product. In a software house, it couldn’t be structured.
Result
- What if unforeseen circumstances will appear?
- What if I’m not happy with the effect?
A software house mostly wouldn’t care about new possibilities, especially when working on a fixed price. It doesn’t pay it. In a digital product studio you work on a daily basis side by side, so there’s no possibility to be surprised about the effect.
Relationship
- What do you expect from your client?
An average software house won’t be demanding because it wants to have you as a client no matter what. A digital product studio wants to work as a partner, so it also chooses you too and it’s focused on a long-term partnership.
Vision
- What are your mission, vision, and goals?
- What’s most important for you as a company?
When you hear only about money, raising revenue, working with leaders on the market and so on, you’re talking with an average software house. Probably it won’t be their exact direction, but only a dream. A digital product studio will tell more about values, people and challenges.
A software company or digital product studio? Ultimately, what the heck should I choose?
I wanted to show you in every detail the differences between the mindset of a software house and a digital product studio. They do for a naked eye the same, but their ‘why’ and ‘how’ is very different.
Ask simple questions and make your decision consciously.
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If this article is a value to you, let me know. ;-)
If you’re looking for a software partner, you can contact us to make an extraordinary product together.
