BY TOM REEVE

What are the fundamentals of outsourcing

Outsourced development, also known as offshore development or software outsourcing, is a business practice in which a company or organisation hires external resources or third-party vendors to handle the development of software or IT projects.

Instead of relying solely on in-house teams, companies opt to outsource development tasks to specialised firms or professionals located in different geographic regions.

Here are some of the fundamental aspects of outsourcing.

External Expertise

Outsourcing development allows companies to access specialised skills and expertise that may not be available internally. These external teams or vendors typically have experience and knowledge in specific technologies, domains, or industries.

Cost Efficiency

Outsourcing development can often be more cost-effective compared to hiring and maintaining an in-house development team. Companies can save on expenses related to recruitment, salaries, benefits, infrastructure, and ongoing 
training.

Scalability and Flexibility

Outsourcing offers the flexibility to scale development resources up or down based on project requirements. Companies can quickly adjust the size of the development team to align with the project’s needs, avoiding the challenges associated with hiring or laying off employees.

Time Savings

By outsourcing development, companies can leverage the external team’s expertise and focus on core business activities. This allows for faster development cycles, as dedicated teams can work on the project without distractions or competing priorities.

Global Talent Pool

Outsourcing development opens up access to a global talent pool. Companies can choose from a broader range of skilled professionals or development firms from various locations, potentially finding the right expertise at competitive rates.

Risk Sharing

When outsourcing development, companies often share risks with the external vendor. This includes responsibilities related to meeting project milestones, adhering to agreed-upon timelines, and delivering the desired quality. Contracts and agreements help establish clear expectations and mitigate potential risks.

Cultural and Language Considerations

When outsourcing development to different regions or countries, there may be cultural and language considerations to manage. Effective communication and collaboration become critical to ensure understanding, alignment, and successful project outcomes.

Data Security and Intellectual Property Protection

Outsourcing development involves sharing sensitive information and intellectual property. Companies should carefully select reputable vendors, establish non-disclosure agreements (NDAs), and implement security measures to protect their data and intellectual assets.

Get in touch

While outsourced development offers numerous benefits, it is essential for companies to conduct thorough research, establish clear communication channels, define project requirements, and select reliable vendors to ensure successful outcomes and minimise potential challenges or risks.

If your organisation is considering making the move to an outsourced team and would be interested in a free of charge consultation and audit we’d love to hear from you.