7 Best Software Development Outsourcing Tips

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The famous saying that you should do what you focus on what you do best and outsource the rest entails the fundamental truth when it comes to finding the best outsourcing partner. It is pretty straightforward, but firstly, you should identify which business aspects or technologies you have already mastered. Secondly, although it may not be a pleasant task, admit you’re not good at everything and consider your weak spots. It might be a tight budget, a skilful team or technological competence. 

For instance, if you’re currently starting a brand new project and need external support with building the software, there are companies out there who have mastered product development and gained professional experience. My experience working in a bespoke software development company, such as Dreamix is, shows me the value of partnerships. We do not have clients that simply want a project delivery. Instead, we have long lasting partners, and as such, we provide business value for each other and grow together. 

Without further ado, let’s look at the seven best software development outsourcing tips, so you can be well-prepared and know what to look for in a reliable vendor partner.

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Outline the Scope and Schedule of Your Project 

While it may be tempting to define the parameters and describe your prospecting software project’s functionalities upfront, software development is a dynamic process, and modifications occur naturally along the way. Requirements volatility (RV) is believed to be a core issue of any software project. New features are being assembled, bugs are being fixed as the project progresses, and this is normal. 

You can either fight this uncertainty or embrace it and as a part of any software development process. This should not mean that you should abandon planning altogether. Try to stay away from definitions set in stone and keep an open mind for what is a possible solution with your current resources and business growth plan. Outline the basic scope and a rough schedule for your project and keep a realistic view during initial discussions. 

Look for a Vendor Experienced in Agile Development 

All the uncertainty should not discourage you from outsourcing your next software project and turning it into the next big success. The Agile Manifesto has been hugely influential during the past two decades. The Agile methodology entails short-term but frequent delivery of small software release or feature. This process allows flexibility and captures new opportunities and growth because of the constant revisions dev teams make. 

When you outsource your project to a company that follows Agile principles, you get to work with a team of highly motivated and collaborative individuals who are devoted to continuous efforts towards technical excellence. Agile teams do not simply execute tasks and build projects, they strive for both personal and professional skill mastery and the way they do it is through regular retrospective meetings, where they discuss what could be improved and how to do it even better next time. Plus, their motivation is contagious, which is always a benefit. 

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Ask About Their Technical Expertise 

Finding out the technical background of the company you consider for outsourcing your project beforehand is an essential step to make during the initial research. Ideally, your software development outsourcing partner has accumulated professional experience through working with clients from different industries and can guarantee that they have successfully built high-quality software. Although being highly motivated is an essential skill when it comes to technical projects, an inseparable step of finding the right vendor for your product is to assess their technical capabilities. 

For example, ask them basic questions about their previous experience with similar projects and the approach and technologies they used to build them. You can also ask them questions about their portfolio and the main programming languages they have experts in. Some companies specialise in Java, ReactJS, Azure, Oracle, mobile solutions (iOS or Android) or providing managed services. Make sure your future partner has broad tech expertise and can prove it – you can even organise a quick mock-up to see the team in action. 

Discuss Product Ownership 

If you are determined to outsource your project to a vendor, make sure you discuss all crucial details around product ownership. Sometimes companies choose to hire an outside vendor to design and build a product you intend to sell later. In case your plan to do to, communicate this aspect clearly with your prospecting partner and choose the best strategy that satisfies both parties. 

Otherwise, if you hire a third party for the entire software development of a product, your business will use, try to raise the topic of product ownership as early as possible to avoid confusion or misunderstandings. For example, who will be accountable for migrating existing data, integrating the new software within the legacy ecosystem etc.  

Assess Financial Stability and Reputation 

Before the negotiation phase with your potential outsourcing partner begins, assess their financial stability to gain in-depth knowledge of who you’ll be doing business with. Whether you end up hiring them as a short-term service provider or seek a long-term strategic partnership, evaluating the stability of the third party partner is essential. 

Are there public financial reports available that you can access to get an overview of their financial performance in the past few years? If so, look through annual reports, financial statements and read reviews from previous customers. Are they satisfied or do they complain about something? Does the company have a positive public presence? What initiatives does it support, and why? This will give you a better picture of their overall reputation across the IT industry and will help you make the right decision. 

Calculate the Project Costs 

When outsourcing your software development project, an essential factor to consider is the financial dimension of it. As I’ve mentioned, it is a good idea to hire a vendor that works according to the Agile methodology as this will also be more cost-effective for your project. Agile contracts entail different cost estimations such as fixed priced work rates, early termination costs or flexible changes during the project. 

Fixed priced packages revolve around the small releases, accomplished during iterations and charge clients for each such release, and the next price is estimated based on the previous. There is also the option of ranged estimates according to the range (or scope) of project duration or adding extra features. For instance, an estimate may be that the work package will take between 20 and 25 weeks and five to six software developers and an architect will be needed. Calculate projects costs in advance and prepare for changes and additional work on behalf of the outsourcing team as some tasks take longer than others and require overtime. 

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Think About Software Support Afterwards

Once your project development is complete, do not forget that it will need regular technical maintenance, updates and bug fixes. Discuss with your vendor partners whether they can provide technical support for your software to keep it smoothly running at all times. You can include this as a final clause in your contract after the project delivery is completed.

If they do not offer support or managed services, ask them for recommendations. After all, they’ve gained your trust and are in the IT industry. It is natural that they’ll have knowledge of other companies that can offer support for your product so that your business can achieve optimal results and help you thrive.