The business world is a cutthroat landscape that requires you to be on your toes every single time. Finding the right way to conduct your business is an important part of making your operations work and one way to provide a solution or meet a deadline is to have the work outsourced to another company or to an offshore location.
Almost 54% of all companies use third-party support teams to connect with customers. Globally, businesses spent $75.2 billion on outsourcing security last year. 71% of financial service executives outsource or offshore some of their services.
Every task, every step in the business is essential for hitting of the targets. Similarly, outsourcing is a trivial task. Some of the small companies do not have the newly established business in order and investing in hiring experts might cost a lot of budget, so software development outsourcing for them might be an option. Moreover, for large companies, it’s like a triangle, low budget, quality and quick. Whether you are a small or large scale company there requires a maturity regarding planning the whole process and execution.
So, there are few things that should be kept in mind for outsourcing your project or else it might turn out to be a nightmare for you. When you sign that dotted line, make sure you know that the people you are handing over the project to are component enough to meet the requirements of the business.
A quick check about the people, backups should be available for downtime, checking on the infrastructure and ensure that the people are experienced enough to successfully deliver what is required. Do not sit back and rely on the cooked food presented on the contract paper. The businesses you outsource to, may be independent consultants or other large corporations. No matter the size of the business you work with, contracting out operational tasks can provide a variety of benefits too. If you want to be on the advantage when it comes to your business, we recommend finding the right outsourcing company who can provide you with extra help.
Pricing is the most attractive point while outsourcing your project. You should look at the vendors who are providing you more services and who has the most experience in this field, not the once who are providing you the lowest cost for the software development outsourcing. Pricing can be one factor but it’s not the only factor to look at. Hence lower cost should never result in poor product quality.
Moreover, when the contract and the pricing is considered while outsourcing the project, everything’s agreed about the time required to deliver the project, the requirements and goals are communicated, perfect. But when the requirements are changed after signing the contract then additional cost is charged and should be kept in mind the developer will take extra amount for investing extra effort. Furthermore, the fixed cost and the hourly rate will include the price of project manager, graphic designer, business analyst and other expenses. Everything works simultaneously regarding cost and quality.
Bridging between the cultures, breaking down the barriers of both teams depends upon the willingness to gel in the cultural diversity with huge amount of patience, positive attitude towards work and strength of mind. Cultural shock is the basic phenomena of working in this environment. You will always meet with different regions of people which will help you to know about different norms of every culture which is a positive aspect for you and your business. Furthermore, culture awareness will help you identify the requirement of the client, acquire huge amount of new perspectives, favorable opportunities and helps in reducing cultural gap. If the vendor is unable to understand the work details, he won’t be able to deliver proficiently.
So, one thing should be kept in mind that the vendor should have a successful amount of experience in the desired region just to understand the terms easily. Or a company which is US based and also have an offshore office. So, while outsourcing your project, remember that you have to deal with different kind of people just to get things done for your own sake and if you will understand the importance of the outside team and software development outsourcing, it will never push you back in adapting the environment.
UK and USA offshoring and outsourcing the projects to the Asian countries, there is a communication barrier. All the members of the remote teams should know the basic “English” in order to deliver proficiently; requirements of the business and to avoid misunderstandings. Basic understanding should be developed in order to be able to promptly deliver what is required, plus reply to the queries related to the project and on the other hand the vendor should be able to understand the requirement in clear and definite terms.
Moreover, when the IT support company offshore the project there are challenges related to time zones. Communication barriers will arise because you are communicating with different company with remarkably different work ethos and time zones. A basic understanding should be developed or else this may lead to long due project, product quality and hence distorted outcome.
In this millennial era, everyone wants to adapt with the new technologies and would want to move further by learning new aspects in the IT world. It is experiential to learn a lot about the IT capabilities. Mostly organizations tend to learn from the failures they go through. The organizational learning phenomenon becomes more important in the application domain. If the tasks outsourced to the outside team, this may cause little or no control over the projects, quality may be affected, the schedules of production may be disrupted, contractual disagreements may occur and most importantly the organization might not learn new areas of innovation and technology.
The management tend to learn the value of IT by using them or watching out for further opportunities. If the IT is outsourced from outside, organization will never know the new hurdles and technology advancement. IT should be adapted and tested in the organization because today if they feel tactical, commodity and low value, tomorrow it will be a strategic, core and high value need.
Moreover, while the project being software development project being outsourced, if the vendor seek this information that the company totally depend on the outsourced team, this will give the subcontractors the opportunity to charge unforeseen and unwanted price increase to exploit the company’s dependency. Furthermore, Monitoring performance of the outsourced project and productivity will be a trivial task challenging, coordination and communication will be tough with offshore vendors.
To sum it up, software development outsourcing can be a plus point for the company and can be beneficial in growth but the risks that would occur should be kept in mind in order to work smoothly with the innovative changes.
The variety of tasks changes over time when innovating in-house, while outsourcing your projects, as roles are passed on to various professionals and different teams, the irregularity often causes slowing down the process and cannibalizing outcomes. The decision of outsourcing should depend upon whether vendors using the latest technology and is it up to date, according to the market and aligning with your software?
The point is, the software development outsourcing team should use the necessary tools because it requires significant investment while outsourcing your project. And if you want to incorporate latest technology which many of the users has to use so outsourcing team
should have certified engineers who can proficiently work on the projects, the software incorporated should be agile, it should be able to rapidly adapt to ever changing business requirements and need. If you choose the wrong vendors in software development outsourcing, it can surely set back the innovations and growth which results in missed opportunities and cornerstone for development plans.
While software development outsourcing, you have to let the outside people move in the premises of the company. For that things become public because the IT support partner or company has the access to customer data and company information. While signing the contract there has to a clause saying non-disclosure provision which helps to prevent the outside team to disclose the company plans, strategies and intellectual property to others. Moreover, the outside vendor should understand the IP and confidentiality protection. The most important is to check that the company has the copyright laws, patent rights and trademark enforcement.
When it comes to software development outsourcing there has to be a definite set of deadlines for the completion of the project. Although reliable vendors and service providers do give a definite time schedules about delivering the services. It is good to steer clear of such companies and associate with those organizations that have the reputation of offering the best to their clients. Because more the delays are occurred more it defines that the company is lazy enough or are incompetent to successfully deliver at the required time. It may also trigger the reputation of the company which is a negative aspect for the goodwill of the company.
These seven software development outsourcing risk occur in every outsourcing decision so these should be kept in mind while outsourcing your projects. Conversely, there should be a corporate knowledge about the software development outsourcing because selective or smart sourcing may become norm. The common reasons for which the company tends to outsource is cost reduction, business focus, subcontracting legacy systems and last company goals.
However, if these above listed risks are real, then software development outsourcing looks more complex and uncertain. Are the benefits and opportunities of outsourcing are so perfect that the risk are worth managing? This logic may lead the companies to adapt mix of selective and smart sourcing. So, to conclude a company’s big gains and opportunities are supposed to come from concentrating on IT enabled business, transformation and eventually growing the business to improve business’s revenue.
Tek Headquarters is a Californian Custom Software Development Company which provides Digital Software Solutions to startups, SME's and Enterprises.
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