Software outsourcing takes place when companies choose to have custom software solutions developed by a third party. Outsourcing software development has many advantages including cost reduction, improved efficiency, mitigated risk, and enhanced security.
In today’s largely digitized business landscape, companies have the ability to access the world’s top software developers. Both established companies and startups alike are using software outsourcing to develop their products.
However, that’s just the beginning. Let’s take a better look at what software development outsourcing is and how it can benefit your business.
What is Software Engineering?
One of the most important activities in today’s world, software engineering refers to the engineering branch that focuses on developing software solutions for diverse purposes. Software engineering leverages a series of principles, methodologies, and best practices to produce high-performing, scalable, and secure software.
While that definition makes it seem as if software engineering is synonymous with software development, the reality is that the former puts emphasis on the engineering part. That means that software engineering uses scientific knowledge as the basis for designing and creating software solutions. That way, software engineering puts precise practices at the very core.
Software Outsourcing as a Global Strategy
The rapid pace at which technology evolves means that the software development industry is ever-changing. New programming languages are introduced, new methodologies are constantly being developed, and previous industry-standard practices become obsolete as more innovative approaches take over. That’s why using software outsourcing as a global strategy has become so important for businesses today.
As the fastest-growing outsourcing company, at BairesDev we strive to drive the software development industry forward. High-quality outsourcing services like the ones we provide are allowing companies from all over the world to instantly fill any skill gaps in their teams, setting them for digital acceleration in the long term.
Once you identify the skill gaps in your tech team, you can identify the elements of your project that need to be outsourced.
Nowadays, software outsourcing providers are seen as valuable business partners who can play a major role in growth. Specialized development areas like blockchain, cloud computing, and the Internet of Things are no longer a challenge for small and medium-sized businesses that don’t have an in-house development team.
Even large enterprises have adopted software outsourcing as a global strategy. As you can see from BairesDev’s Success Stories, Google entrusts us with automation engineering, Thomson Reuters is one of our biggest clients in accounting technologies, and ViacomCBS is using our services to evolve MTV’s web apps.
The Benefits of Software Outsourcing
There are many benefits to outsourcing software development, including:
Accessing Global Expertise
At BairesDev, we work with the Top 1% of Tech Talent. We receive over a million software developer applications per year, and we select and hire less than 1% of the most talented software engineers.
Complementing Existing Infrastructure
Outsourcing development helps companies achieve their vision by outsourcing skills they are lacking in-house.
Faster Turnaround
Outsourcing can speed up the software development process without compromising on quality. Working with experienced developers who understand the principles of your project can accelerate your product’s time to market.
Reducing Costs
Outsourcing allows companies to focus on their core business functions and direct their time and resources towards solving capacity issues. This is a great way to increase cost-efficiency.
Flexibility
When you outsource a software project, you only pay for the expertise that you need. It eases pressure on internal staff and frees up company time to focus on the day-to-day running of the business.
Reduced Risk
A software outsourcing company can help mitigate the risks of developing your project. An experienced team will be able to foresee potential liabilities and identify errors through robust testing and QA practices.
Responsibilities Are Met
An experienced outsourcing team will have robust workflow processes in place to ensure that progress is monitored, milestones are met and projects are completed on time.
At BairesDev, we carry out feasibility studies as part of our outsourcing process to provide technological and budget validation. We provide proof of concept, develop prototypes, and implement quality assurance testing to minimize the risks early in the product development cycle.
How Does Software Engineering Outsourcing Work?
Outsourcing software engineering is a complex endeavor with many associated challenges and pitfalls.
However, you can really succeed at it with the help of a quality software engineering partner and a tight process to guide you. And while that process might differ from company to company and industry to industry, we can sum it up in 5 key steps that determine how it all works.
Project definition
The first step consists in defining the objectives and scope of the project at hand. Here, you establish what you want to build, how much you can spend on its construction, the goals you hope to achieve, and the overall timeline. You need to do all this before even thinking about outsourcing, mainly because you need a complete understanding of your project to decide which type of outsourcing engagement you’ll need.
Outsourcing research
Armed with your project details, you can now go out and research the available outsourcing companies that might complete your project successfully. This means you’ll need to search for appropriate companies with the expertise and industry experience your project requires. This is an exhaustive process that will have you shortlisting outsourcing companies, understanding their services and models, and evaluating their quality, experience, reputation, and processes.
Project start
Once you have picked the outsourcing company that better fits your needs, it’s time to kickstart your project. In other words, you need to meet with the outsourcing team, explain your goals, and devise the roadmap ahead. It’s of extreme importance that you define your involvement in this step so you know exactly what to expect moving forward.
Software engineering
When the strategic plan is in place, the outsourcing team can start working on the software engineering process itself. Depending on the engagement model you’ve committed to, this can mean different things:
- Start work with your in-house team aided by the outsourcing professionals
- Outsource the part of the project you need the outsourcing company to do
- Outsource the entire project for the outsourcing company to work on
Which option you end up going with will depend on your own requirements. You might go with staff augmentation to bridge your team’s skill gaps, outsource a part of it that falls outside your team’s capabilities, or outsource the entire project to have the ability to focus on other, most pressing activities.
Project completion and beyond
The outsourcing team will follow the agreed map and provide the deliverables according to the predefined timeline. Naturally, this process will have numerous changes and adjustments based on your feedback. The logical conclusion is having the software ready but that doesn’t necessarily mean the process ends there. Depending on the type of project, the outsourcing partnership may go on to provide maintenance, updates, and further development.
The 3 Main Models of Software Outsourcing
There are 3 principal software outsourcing models that companies can choose from. Each model has its own advantages. The outsourcing model that suits your project will depend on its level of complexity, your budget, timescale, and level of involvement.
The simplest form of software outsourcing is the staff augmentation model, where an outsourced team works alongside your internal team to develop the software. Augmented teams typically have face-to-face contact with existing staff, often working from your offices until the project is complete.
The dedicated team model presents outsourced talent which has more responsibility for overseeing the project. Our Delivery Teams thus provide management structure, allocating specific tasks and monitoring workflow. In this way, you benefit from the expertise of highly-skilled developers who provide a specific service.
With a project-based model, the outsourcing company oversees the entire software development process, from defining the specification to allocating workflow, setting timescales, and quality testing.
Best Outsourcing Locations: Latin America
Now that you know all about the benefits of software outsourcing and what types of custom solutions you can get out of it, you might run into an undeniable fact: the world is a huge place, and finding the right outsourcing partner can be a hassle. To make this process easier, the first thing you need to do is check out the best regions for software outsourcing and whether you should go for nearshore or offshore outsourcing.
Today, most businesses (especially those in the U.S. & Canada) prefer to outsource their software development needs to Latin America. Why? Because Latin America simply offers more benefits in comparison to other regions, which include timezone coordination, a massive talent pool, cost-efficiency, geographical proximity, and many more.
With all of that said, these are the best outsourcing locations in Latin America.
Argentina
No one can deny that, right now, Argentina is one of the most popular countries for outsourcing software development. This country is home to some of the most skilled software developers in the world, and their huge talent pool is making an impact everywhere in the field.
Colombia
Colombia is perhaps the most tech-driven country in the Latin America region. As an interesting fact, Medellin, one of the country’s most prosperous cities, is known as “The Silicon Valley of Latin America” due to the many software development companies located there.
Brazil
Being the largest country in Latam, Brazil is great at outsourcing a lot of goods and services—but software development is one of the things it does best. The innovative mindset of Brazilian developers has driven the growth of countless projects.
Mexico
Mexico’s convenient location and top talented software engineers have made it one of the top choices for outsourcing software development in the world. If your company is based in the U.S., then Mexico is always a sound choice for outsourcing.
How to Outsource a Software Development Project?
To help ensure that your project flows seamlessly, here are our 3 steps to outsourcing software development:
#1 Evaluate Your Team’s Skills
Before outsourcing software development, you need to know what expertise you require. Evaluate your team’s skills and identify any gaps in their capabilities. Once you know what skills you need, you can create a project specification, explaining what the product should do and how the work should be executed.You can then contact the outsourcing companies on your shortlist and decide which one will be a suitable partner.
At BairesDev, we consider the project specification in detail. Our workflow is characterized by our unique design-thinking mindset, which ensures that every project is delivered on time.We have a 5-step approach to software development: empathize, define, ideate, prototype, and test. This methodology enables us to execute projects quickly without compromising on quality.
#2 Verify the Quality of Outsourcing Companies
Before you commit to hiring a software development company, check their reputation in the marketplace. Have a look at their website and read through their case studies. You should also check third-party review sites and their social media channels to see how they’re positioned in the industry.
Finally, you should contact their previous clients to verify the quality of their work. At BairesDev, we’ve worked with clients such as Hewlett-Packard, IBM, and Volkswagen, to name a few.
#3 Implement Project Management Processes
Once you’ve chosen your software outsourcing team, project management tools need to be implemented to chart progress. Platforms like Basecamp, Trello, and Jira enable tasks to be allocated to specific developers. They also enable communication between the client and developers through calendars and messaging threads. Your outsourcing company should allocate an Engineering Manager and Team Leaders to ensure that milestones are achieved and responsibilities are met.
The key to successfully outsourcing software development is communication. When communication channels are open, projects can progress efficiently and launch on time. Remember, it can take time to find a software outsourcing company that you want to work with long-term. The impact that outsourcing development can have on your business makes the research worthwhile.
At BairesDev, we provide highly skilled software engineering teams with the Top 1% of Tech Talent. We provide delivery of software projects to companies of all sizes, from startups to global corporations. We’re led by an Agile mentality, powered by technology and driven by talent.
Outsourcing Myths
Here are some outsourcing myths that need to be debunked.
“Software Outsourcing is the same as Staff Augmentation”
While most software development companies that provide software outsourcing services also offer IT staffing, these two are completely different solutions. To put it simply, IT Staffing adds the talent directly to your in-house team. On the contrary, Software Outsourcing transfers all the workload to your third-party partner.
“The main purpose of Software Outsourcing is to reduce costs”
While it is true that outsourcing initially became popular because of its cost-saving capabilities, this is not the feature that has made it as important as it is today. Every tech leader will tell you that, in software development, talent is the most important resource to have—and outsourcing gives you access to the best engineers there are across the world.
“Outsourcing increases costs”
Well, this is certainly the other end of the previous myth. No, outsourcing doesn’t increase costs. In fact, it saves you all the costs related to finding, hiring, and retaining in-house employees! This means you can forget about paying for recruiting managers, health insurance, ongoing training, 401Ks, office supplies, and everything related to that.
“You can get the same benefits from freelancers”
Hiring freelancers is definitely not the same as outsourcing services from a reputable company. While some small projects might get away with small contributions from freelancers, companies that choose to outsource do it because software outsourcing provides guaranteed talent in the form of custom-built teams that match exactly what your project needs.
“Software Outsourcing is the same as Staff Augmentation”
While most software development companies that provide software outsourcing services also offer IT staffing, these two are completely different solutions. To put it simply, IT Staffing adds the talent directly to your in-house team. On the contrary, Software Outsourcing transfers all the workload to your third-party partner.
“The main purpose of Software Outsourcing is to reduce costs”
While it is true that outsourcing initially became popular because of its cost-saving capabilities, this is not the feature that has made it as important as it is today. Every tech leader will tell you that, in software development, talent is the most important resource to have—and outsourcing gives you access to the best engineers there are across the world.
“Outsourcing increases costs”
Well, this is certainly the other end of the previous myth. No, outsourcing doesn’t increase costs. In fact, it saves you all the costs related to finding, hiring, and retaining in-house employees! This means you can forget about paying for recruiting managers, health insurance, ongoing training, 401Ks, office supplies, and everything related to that.
“You can get the same benefits from freelancers”
Hiring freelancers is definitely not the same as outsourcing services from a reputable company. While some small projects might get away with small contributions from freelancers, companies that choose to outsource do it because software outsourcing provides guaranteed talent in the form of custom-built teams that match exactly what your project needs.
“Software Outsourcing is the same as Staff Augmentation”
While most software development companies that provide software outsourcing services also offer IT staffing, these two are completely different solutions. To put it simply, IT Staffing adds the talent directly to your in-house team. On the contrary, Software Outsourcing transfers all the workload to your third-party partner.
What Should You Look For When Outsourcing Software Development
- Choose the Right Partner: A successful partnership needs to kick off the right way. Make sure you are completely on board with how the project will be developed, the deliverables, the deadlines, and so on. Also, don’t forget to study the company’s reputation in the industry, as well as their past work, recruitment process, and expertise.
- Choose the Outsourcing Model That Works for You: As we mentioned before, there are 3 main outsourcing models you’ll need to choose from. It’s best for you to understand the differences between them and make the choice that works best for your purposes. If you can, try to carry out an internal assessment and study your experience, capabilities, and weaknesses. Software outsourcing services are fully customizable, so in the end, your choice will always suit your needs.
- Set Clear Expectations from the Start: Although the goals of each project will vary, setting clear expectations from the very start will always have a major impact on how the project grows and develops. As time goes by, it’s also a good idea to perform numerous evaluations so as to clearly identify progress and make the necessary amendments before too many resources have been invested.
- Make Communication a Priority: Good communication is the basis of any successful software development project, including software development projects managed by external teams. When all messages and feedback get across, you can be sure that your project is on its way to success. So remember to define the standard communication channels for your project!
- Focus on Scalability: They say that no software is ever truly finished—and, most of the time, they are right. That’s why the best software outsourcing companies will prepare a maintenance plan according to your needs from the beginning, making sure that there is a strategy to guarantee the scalability of your software once development completes.
Software Development Outsourcing Trends
Whenever a year ends and another begins, the software development websites fill their blogs with the trends expected for the new year. That happens in all areas related to software engineering, including outsourcing software development. Naturally, in a field as dynamic as software development outsourcing, the trends come and go all the time, sometimes in the span of weeks.
That means that it’s impossible to predict which trend will dominate the field next. Yet, there are certain areas of software outsourcing that are always seeing new trends, including those facilitated by a software development outsourcing company, including:
- New digital technologies
- New development methodologies and approaches
- New outsourcing services
- New actors in the outsourcing landscape
- New regulations impacting outsourcing
What IT Services Can Be Outsourced?
Outsourcing IT services is (and must be) a fully-customizable practice. Why? Because of two main reasons: complexity and scalability. No matter which kind of technology solution a company is aiming for, every project will always have unique requirements that match the particular context of the organization. And, as the project naturally scales, it will develop new requirements that aim to higher goals.
Knowing this, we can see how the types of IT services that can be outsourced are completely dependent on what’s needed by the client. At BairesDev, we approach outsourcing by assigning dedicated teams of Top 1% IT Talent software engineers to assess, develop, implement, and provide support for our clients. This way, we can deliver high-quality custom solutions effectively and consistently.
In our experience, we’ve found that the most commonly requested IT services are:
Custom Software Development
Developing custom software applications is at the heart of all IT outsourcing services. Whether it comes to customizing a running platform, developing simple applications for a small business, or creating complex solutions to address the requirements of enterprises, businesses outsource custom software development to achieve their ideal technology solution.
QA Services & Software Testing
Quality assurance and testing can come as standalone or integrated services and should be the result of a deep understanding of your business goals and applications. Outsourcing QA helps your product commit to the highest quality standards in the market, drives innovation, and adds insightful value to the software development life cycle.
Cloud Computing
Developing a seamless integration between business operations with cloud-based technologies is a must for today’s landscape. By outsourcing cloud computing services, organizations can accelerate their digital transformation while increasing business agility, lowering costs, and reducing IT complexity.
Mobile & Web Development
Master-crafted websites, authentic user engagement, and successful brand experiences are the result of top web and enterprise app development services. Most companies these days know the value of having a strong online presence—not only is it essential for interactivity but also a great asset to optimize business processes and increase productivity.
IT Maintenance & Support
Staying up to date with the latest regulations, policies, and practices is not an easy feat. Especially in a world as fast-paced as the one we live in. Working with the best software developers and support engineers makes it easy to manage IT processes with accuracy, flexibility, and structurality.
Blockchain Consulting
The breakthroughs in blockchain technology have made it a tempting alternative for managing all kinds of operations. Right now, blockchain’s powerful & verifiable network is helping organizations across every industry maximize efficiency and reveal new business opportunities while guaranteeing the validity of information through an immutable system of registers.
Big Data & Analytics
Living in the age of data has its pros and cons. From a business perspective, it’s fundamental to make use of the pros. Capitalizing on the massive amounts of data resources available is drawing the line between successful and not-so-successful projects. Data-driven strategies are the future (and the present) of business operations.
IoT Solutions
More and more companies are taking advantage of the Internet of Things to operate more efficiently, gain a deep understanding of their customers’ buying patterns, and increase the value of the business. Smart cities, telemetrics, sensor networks, traffic analysis, and industrial monitoring are all part of the current IoT revolution.
UI/UX Software Design
Every single company out there should aim for a great User Experience strategy supported by an engaging User Interface design. When customers have great experiences across all contact points, it’s easy for any brand to gain competitive advantages that escalate conversion, reducing customer churn, and promoting loyalty and advocacy.
MVP Development
A Minimum Viable Product (MVP) is a development model in which a product is built with just enough features to satisfy the needs of early adopters. Working with a top MVP development team, especially one specializing in outsourcing software development, will guide you throughout the bumpy road of new product development and ultimately turn your raw ideas into usable software.
