These days many companies who face a need for software development go with outsourcing. The main advantages of outsourcing are: cost effectiveness, fast and high quality results, sharing development risks. There could be more advantages but these most commonly recalled for an average software development project.
There are several types of outsourcing. It can be onshore, nearshore or offshore. We talk about onshore outsourcing when a client and a developing company are from the same location (meaning the same country). Nearshore outsourcing arises when a developing company locates in the country close to the country of a client company. And offshore outsourcing means that a developer and a client locate on different continents.
Each type of outsourcing brings more or less advantages, as well as more or less risks. For example offshore software development outsourcing is considered to be the most risky, however one of the most popular types. Offshore developers are usually the most cost compatitive and highly qualified.
To reduce risks of offshore outsourcing you may use several models. For example you can hire several outsourcing developers to allocate development risks. Or you can go with “Outsource-Inhouse” development model where you outsource part of tasks to an offshore company while part of tasks is the responsibility of your own development team.
But before even take the risks of outsourcing it is recommended to make a good consideration of weather you really ready for this. See the tips which will help you when making a decision about outsourcing:
1) Know exactly what your project is. Have a clear idea of what you are expecting as a result. Think of the scope of resources, technologies and skills needed to fulfill the project. If this is a finished project which does not require a further development in near future and you don’t have enough resources you’d probably outsource.
2) Communicate your prospective developer. Find out if a developer has enough skills, knowledge and resources. Ask him to make a project evaluation. During the interviews with a developing company you also need to find out if you are good with time-zones, communication skills, development methods and approaches. If you think that your partner is trustworthy enough, can communicate well, makes an impression that he knows what is he talking about you’d probably go for outsourcing.
3) Be precise with scope, quality and prices. While initially contacting with your prospective developer make sure you provide the most accurate information about your project. This will ensure the better quality and price estimation. If schedule, budget and quality guarantees are close to your expectations you probably want to go with outsourcing.
4) Evaluate risks. The most commonly known risks which associate with outsourcing are: competence risks, confidentiality, operation risks, failure to deliver the final product, cost risks. You need to evaluate your risk not only when making decision if to go with onsite development or outsource, but also if to outsource onshore, nearshore of offshore. But keep in mind, there could be probably no way to avoid some risks but to reduce them. So if your risk portfolio is balanced – you are ready for outsourcing.