The business world has never been more connected than it is today. One good example is the current rise in service outsourcing. The idea is to have third-party specialists handle specific operations for one’s business.
Seeing how several businesses need software products and mobile and web applications, these rank among the most sought outsourcing services. You can see Imenso’s software development outsourcing services for more information on services that fall into this category. However, some still use the in-house approach for reasons that will include ignorance of how outsourcing benefits them.
To help with this, this article discusses the benefits that a business can derive from outsourcing. So, read on to stay informed.
Needs that Justify Software Development Outsourcing
There are several reasons for outsourcing software development tasks rather than hiring an in-house team for this purpose. Some of the benefits include:
Cost Reduction
One of the most important reasons why companies outsource is the cost effectiveness of that decision. Interestingly, many do not outsource because they think it’s a more expensive option. This view supports our initial position that ignorance plays a major role in the decision not to outsource.
Here are some reasons why outsourcing is more cost effective:
Economies of Scale
Economies of scale explain the cost benefits of increased output. Here is an example to help you understand what it means.
Imagine two businesses selling boiled eggs. Business A boils 5 eggs at the same time using the same resources (pot, fuel, cooker), while Business B boils 40 eggs at the same time using the same resources.
Business B is more likely to offer competitive pricing because of its better economic use of its resources and time. You can click here for more insight into what economies of scale is about.
How do economies of scale apply here? The third-party agencies that you outsource to are like Business above. These providers offer their services to other clientele at the same time and as a result, they can offer competitive pricing.
Furthermore, the service scope of many of them is another way to justify what they offer in terms of economies of scale. For example, if we have a company named Imenso Software Development Outsourcing Services, they will offer a bouquet of services that will cover software, mobile applications, website development, data analytics, digital marketing, and cloud and DevOps services and more.
The implication here is that you can achieve all of these with just one service provider. This is certainly more convenient than having to deal with multiple parties and, of course, the attendant cost implications, among other things.
Reduced Chance of Project Failure
Regardless of how cheaply businesses handle these tasks in-house, failed projects cost them significantly. This is both in terms of finances, time, and effort wasted. As a result, turning to a more success-guaranteed approach is cost-friendly, and this is what outsourcing to competent agencies offers.
Low-Cost Environment
A growing practice among companies that outsource software development and related services is hiring freelancers and agencies from low-cost environments. These are parts of the globe where you get as much and possibly more while paying less than you would in some other parts of the world. Parts of the world that usually come up in such conversations include:
- India
- Southeast Asia – Indonesia, Thailand, Vietnam, and the like
- Eastern Europe – Ukraine, Romania, Poland, and the like
- Latin America – Brazil, Argentina, Mexico, and the like
- Africa – Egypt, Morocco, South Africa, Nigeria, and the like
Of course, service quality must always take precedence over service cost. However, the good news is that many companies have had positive experiences engaging freelancers and agencies from these parts for these tasks.
Access to Expertise
Successful execution of software development and related tasks requires a great deal of technical expertise. Software development companies are more likely to have the talent pool that this requires.
For example, a business’s website needs to be UI/UX intuitive and responsive for various digital devices, among other things. This specifically requires expertise in UI/UX research and design, frontend engineering, and backend engineering.
These specialized third-party agencies are in a better position to know this and make informed recruitment decisions based on this. Furthermore, recognizing the constantly evolving digital world, a good number of them periodically train and retrain their recruits.
On the other hand, businesses that attempt to completely handle such tasks in-house may make the mistake of hiring and entrusting incapable personnel with such tasks. This increases the chances of project failure in several ways. For more on the risks and implications of hiring wrongly, you can visit: https://www.bizcommunity.com/.
Enhanced Business Efficiency
There is always the possibility that businesses that handle these tasks in-house would divert attention from their core business operations. This can adversely affect them in several areas.
Outsourcing ensures capable hands handle these technically complex and resource-intensive tasks. As a result, businesses that make the smart decision to outsource can focus on what they know how to do best and worry less about other things.
Pace
A project’s success hinges on both its effective and efficient execution. These specialized third-party agencies aim for efficiency just as much as effectiveness. For the record, effectiveness implies that all aspects of the project are successful, but efficiency factors in some other things.
The pace at which projects are completed is one of the yardsticks for determining efficiency. This is especially because delays can cause downtime and inconveniences (at the very least).
Businesses in need of software development outsourcing services stand a better chance of having their projects completed quickly yet effectively with these service providers. This is as they usually consist of a larger team compared to the structures of in-house IT departments.
Furthermore, they understand the time-sensitive nature of many of the projects they embark on and are willing to work around the clock. The pace advantage is also because clients who hire these service providers do not need to worry about the time-consuming nature of recruiting the right talent.
Conclusion
Fully leveraging digital platforms and services helps businesses stay competitive, which is what software development outsourcing offers. Service providers also need to stay updated. For example, being aware of outsourcing trends such as hiring from low-income environments, is important. However, the priority is ensuring you outsource these tasks to capable agencies.
This ensures that certain pitfalls are avoided. As a result, tips for proper outsourcing include – clear project definition, extensive research of prospects, and portfolio evaluation.
