All the Good Reasons Why Outsource Software Development

Trung Tran

Trung Tran | 25/04/2023

Why Companies Outsource Software Development?

Software outsourcing is nothing new in the IT sector. On the contrary, it has become a prevalent business practice when it comes to solving the conundrum of balancing between budget constraints, tech talent shortages, and project deadlines.

In recent years, the world of tech business has seen a massive surge in companies outsourcing a part of their business processes or their entire software development projects. This is due to the fact that outsourcing offers many advantages for both small companies and global corporations, making it an attractive option for a wide range of organizations. According to Statista, the revenue of the segment software development outsourcing is projected to increase and soon reach $430 billion by 2023, and it is expected to hit $586.3 billion by 2027 by 2027 with an annual growth rate of 8.07% (CAGR 2023 – 2027).

For those who are reluctant to jump on the bandwagon or consider it as an option, this article will be a helpful guide in understanding the reasons why companies outsource software development and why you should too.

The Key Benefits of Outsourcing Software Development

The Key Benefits of Outsourcing Software Development

Oftentimes, software development companies have their own reasons to outsource their work. While many choose outsourcing services as their last resort, some opt for outsourced software development partnerships as their innovative solutions to accelerate their business growth in the long run. Despite their reasons, their targets are nearly the same, to tap into a wide range of benefits they otherwise would not access in-house.

Reduce the Overall Costs of a Software Development Project

Many companies are driven to outsource software development due to the cost reduction benefits it can offer. In some cases, outsourcing software development can provide a 50% to 90% reduction in overall costs compared to traditional methods. This is the result of cost-cutting in multiple areas of your software project.

You have to agree that developing software solutions in-house can be prohibitive as you have to bear costly upfront investments in setting up in-house development teams, ranging from salaries, equipment, office infrastructure, and other expenditures. Meanwhile, by partnering with an outsourcing team, you can save a significant amount of operational costs and leave some financial burdens to the outsourcing companies, allowing you to facilitate cost efficiency.

In addition, hiring onshore software developers is expensive and competitive at the same time, which is a huge challenge for small to medium-sized businesses. But if you contract a nearshore or offshore outsourced team, you can benefit from the economic labor costs as the outsourced talent in different destinations charges lesser hourly rates for their services.

Vietnam, for example, is one of the most cost-effective countries for software development outsourcing services, with developers charging an average rate of around $20 and $50 per hour. When outsourcing to Vietnam, businesses can cut up to 90% of development costs compared to the U.S.

Gain Access to a Sizeable Pool of World-class Talent

Outsourcing enables any software development company (of any size) to access highly skilled professionals not only outside of your company wall but also across geographic borders. Through software development outsourcing companies, you can tap into the local talent pool from different countries and gain access to experienced, world-class developers who specialize in a wide range of skills, technologies, and capabilities that can be hard to find in your in-house team or even unavailable in your local area. With reinforcement from an outsourcing partner, your in-house development team can be more efficient and productive as they are supported with adequate resources.

Bring in Expert Domain Knowledge

You can take your software development project to the next level with expert knowledge and creative ideas from a reliable outsourcing company. A dedicated team of highly skilled developers can provide you with fresh perspectives, new methods, innovative approaches, and insights into different technologies and development tools that are not familiar or within reach of your in-house team. In this way, you can have experts providing on-the-job training for your internal staff while enriching your in-house intellectual capital.

More often than not, any software outsourcing company has vast experience in working on various types of software projects, so they are well-equipped with the in-depth knowledge and expertise to handle your specific business operations. This is highly beneficial, as you don’t have to invest time and money in training your team in these technologies or risk dealing with rookie mistakes and delays. However, you should pay attention to the factor of company culture when choosing the right outsourcing partner to ensure both inbound and outbound teams can work harmoniously.

Flexible Staffing Option & Team Structure

A product development cycle can last longer than expected and consume more resources, or vice versa. And there are variables that could affect the work process, such as market trends, customer expectations, and project scope. Moreover, when working on complex software projects with a long list of requirements, you need to have clear control over staff decisions.

With a software outsourcing team, business owners can adjust their team size and model on demand. You can scale up or down during different stages of the project depending on the current situation. This is because you can hire developers on a non-permanent basis.

You can either choose to contract a dedicated development team to conduct long-term projects or staff your project temporarily. The flexibility enables you to cut spending on idle staff while saving your in-house team from overloading and burnout due to the shortage of human resources.

Focus on Core Competencies

One of the most significant advantages when delegating parts or the entire project to an outsourcing development partner is that you can shift your focus on the core business activities while letting the experts take over non-core expertise and tasks. For example, you will not need to involve in hiring specialists yourself or invest in staff training.

This allows you to concentrate on the growth of your business and other priorities while outsourcing teams handle software development challenges. You can then use your in-house resources more effectively and efficiently on tasks that are essential for product success and company performance.

Shorten Time-to-market

Obviously, it takes much longer to set up a full-fledged development team all by yourself. Instead, you can cut to the chase with an outsourced team of skilled and experienced developers and get your project off the ground without delays. You can also use their expertise, best practices, and industry knowledge to accelerate the development process.

Since you do not need to muddle through the issue of manpower and resource availability, you can get the work done on a tight timeline and deliver solutions at a much shorter time to market. This way, you can capture more opportunities while boosting the ROI of your business operations. In addition, when working with offshore developers, you can also take advantage of the time zone difference to have your project running 24/7 and accelerate the completion of your project.

Stay Up to Date with the Emerging Technologies

Digital transformation is taking our business realm by storm, leaving organizations and companies no choice but to embrace advanced technologies in order to survive and thrive. The latest technologies, development frameworks, and project management tools are continuously evolving, which makes it difficult for most companies and their in-house teams to keep up with them.

Through an outsourcing company, you can leverage the domain knowledge and technical know-how of its teams. You can access dedicated resources with expertise in various development technologies, such as cloud computing, mobile app engineering, DevOps automation, artificial intelligence, blockchain technology, and so forth. Additionally, these teams come equipped with tools and processes required to manage the software engineering process smoothly from start to finish. This ensures that you can stay relevant in the global market and keep up with the ever-changing demands of your customers.

Enhanced Security & Quality Assurance

In software development, security and quality assurance are the top priorities, and it may become a bigger concern when it comes to outsourcing.

Fortunately, outsourcing companies come with their own set of stringent processes and security measures to ensure that your code is protected against cyber threats. They are also equipped with sophisticated testing procedures to guarantee product reliability in terms of performance, scalability, compatibility, and other aspects. Additionally, they have comprehensive quality assurance processes in place to deliver bug-free software applications that meet your quality standards. With solid expertise, attention to detail, and commitment to delivering the best-in-class solutions, you can trust them to develop software that meets and exceed your expectations.

You can rely on their expertise and experience to reduce the risk of potential vulnerabilities, data breaches, and other security issues. Consequently, you can rest assured that your project is safe in the hands of professionals who are devoted to protecting your app against any malicious activities or cyber threats.

Software Development Outsourcing with Orient Software

Orient Software is a reputable company specializing in software development outsourcing, and we have almost two decades of providing top-notch services for all-sized businesses across the globe.

Why should you partner with us? We understand the unique needs of each customer, so our teams strive to create bespoke software that meets their exact requirements. Our experienced developers are experts in various programming languages and technologies, such as Java, JavaScript, PHP, Python, iOS/Android app development, DevOps automation, and more. We take pride in delivering high-quality products on time so that you can stay ahead of the competition.

At Orient Software, we understand that trust is essential when it comes to outsourcing your software development projects. That is why we maintain total transparency throughout the entire process – from requirements gathering and project planning to development and deployment. Our teams are always available for any questions or updates regarding the progress of your project.

With our commitment to quality assurance, security compliance, customer satisfaction, and agile methodology, you can trust us to provide you with high-quality products that help your business achieve a competitive edge in the market. Contact us today to learn more about what we offer.

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