Frequently Asked Questions About Software Development Outsourcing

The practice of outsourcing software development is incredibly beneficial for companies in need of a development team (and beyond) to get jobs done. Due to a wide variety of factors, mostly stemming from time and monetary constraints, companies sometimes need this leg-up in the world of technology to build software programs, customize current ones, or help get things completed for clients.

Although software development outsourcing companies try their hardest to make their practices, procedures, costs, and methodologies an up-front part of the hiring process, it still isn’t uncommon for business owners to walk away from interviews with potential companies feeling a bit stumped.

The Most Frequently Asked Outsourcing Questions

Even after thorough research and vetting of individual development partners, hiring company execs may find themselves still scratching their chins on some aspects of the outsourcing process. Apart from learning about the numerous advantages to a third-party software team, there are multiple questions that commonly come up during the search.

Below are a few of the most asked and arguably most important questions for business owners to find the answers for before signing onto any kind of partnership with an outsourcing provider:

1. What exactly is software development outsourcing? – Software outsourcing is the practice of hiring a third-party team or company to handle all tasks associated with the development or on an on-demand basis. This can include team members to not only take care of the actual development but also testing, design, project management, support, and anything and everything in between. These factors are dependent upon the company’s needs and their contract.
2. What are the types of software outsourcing and what do they mean? – There are 3 general categories of outsourcing for businesses to consider. Each option comes with its own pros and cons that require consideration before hiring:
3. Onshoring – This is the practice of hiring a third-party team located in the same country and timezone as that of the hiring company. With this, businesses are literally keeping their work “on the same shore.”
4. Nearshoring – In keeping with the literal naming conventions, nearshoring means hiring an outsourcing team from a neighboring country or one that shares the same time zone. This helps alleviate some costs while still making it easy for in-house and outside workers to collaborate and work together.
5. Offshoring – When hiring companies choose to work with outsourcing partners located in countries far away from their own, this is offshoring. This option allows businesses to work with teams in places where the cost of living is significantly lower than their own, therefore saving quite a bit of money.
6. Why do companies typically choose to outsource? – Companies typically prefer to work with third-party software teams due to 2 factors: money and time. Sometimes they simply don’t have the budget required to recruit, hire, and continually pay an in-house developer. They may also lack the ability to hire a full development team for the same reasons as they are rather expensive to keep on as full-time employees.Time is also a major factor in outsourcing. Many companies with in-house development teams are at their limit when it comes to workloads and simply need more hands to get the jobs done on time. Outsourcing teams help alleviate both of these problems.
7. Who owns the software developed by an outsourced team? – This is something dependent on the hired outsourced partner. However, intellectual property rights and nondisclosure agreements are a standard part of any kind of outsourcing situation. Companies must ensure that their contracts clearly state who owns the software or property so that there is no confusion by either party at any time.
8. How do outsourcing providers charge? – This is also dependent on the outsourcing provider or the requests of the hiring company. Some companies charge on an hourly basis while others may charge on a project or monthly basis. Retainers are a great way for hiring businesses to keep track of how much they regularly owe per month without all of the guesswork, unless in special cases.
9. What kind of projects should companies hire outsourced teams for? – When companies have a continuous flow of development work or require a one-off project, outsourcing companies are a great fit for the job. They have the ability to act as an extension of any existing in-house team or have the experience to act autonomously to get projects done.
10. Does the hiring company need to be “tech-savvy” to hire an outsourced software development team? – While it’s always a good idea to have someone on the inside who can speak the language of technology, companies don’t have to have any previous development experience. The hiring company will obviously need to give input and help clarify the project questions in terms of functionality and expectations, but that doesn’t mean that they can’t leave all of the design, planning, development, and all other aspects to the professionals of the hired dev team.

Software development outsourcing may seem scary initially, however, it’s an incredibly beneficial practice for all parties involved when done correctly. As long as hiring companies take the time to do their research to understand not only who they should hire but what to expect from the process, the results are well worth the efforts.