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Key Factors to Consider While Outsourcing Software Development

By CIOReview | Wednesday, March 15, 2017

In today’s fast-paced competitive business world, driving efficiency is the key factor to stay ahead in the game. Enterprises are determined to gain competitive edge by reducing the cost, optimizing efficiency and providing better customer service. One of best ways to achieve operational efficiency is by outsourcing software development, which has been proven beneficial to many companies globally. Outsourcing will significantly lower company’s operational costs and allows them to focus on core aspects of business. However, some organizations fail to outsource effectively due to the lack of knowledge and experience, which causes irreparable damage to the organization.  Below are few tips to help organizations overcome the difficulties while outsourcing.

Look for Enterprise with Vast Experience

A firm that has synergy with various companies and technologies will offer better flexibility, adaptability and innovation compared to a start ups or firms that is specialized in specific technologies and industries. Therefore, while outsourcing, it is better to select an enterprise that has deep expertise in managing business work efficiently.

Clients that Provide Integrated Solutions

While choosing a client to outsource development, enterprises must look for clients that can rapidly adapt to the changing needs and not based on the brand name. Opting for an inefficient partner can set back growth and innovation.

Methodology Used

An experienced firm will have a well-defined, streamlined software development process along with skilled developers. It is wise to avoid companies that fail to explain the methodology clearly.


Outsourcing can be both lucrative and risky in terms of corporate IT agility. It can be very helpful if an enterprise lacks internal talent or time. Outsourcing can be better option for businesses that fail to complete their projects before their deadline. It is the responsibility of a CIO to weigh pros and cons before leaping forward to get the work done quickly and efficiently.

Intellectual Capital

Losing intellectual capital is another important factor to consider, while outsourcing software development. This aspect may lead an enterprise to two major risk repercussions.

• Firm that has outsourced its development will lack knowledge on how to extend on an application, since outsourcing company would have thorough knowledge on it.

• Along with that, firm outsourcing development will incur risk of losing confidentiality about their products concept, which can erode competitive edge. It is necessary to ensure that while outsourcing Development Company’s intellectual capital is secure.

Communication and Collaboration

In today’s time crunch nation, agile development is at the heart of innovative project. It’s therefore important to have this in mind before outsourcing project work to a third party, especially while off shoring. It is also essential to maintain a comprehensive documentation of software to have a clear understanding.

Looking into offerings and services while partnering

Enterprises must have a clear idea of what kind of support is offered by an outsourcing company, because in most cases, firms might need assistance in configuring new applications, comprehending functionality, and learning how to use the software. The support received after the deployment of the application is as important as the development process.


Outsourcing software development is the best solution in the age of globalization and key to a company’s success. From management training to payroll software, outsourcing manages it all. By considering the above factors, organization can experience enhanced efficiency and productivity in non-core business processes. On top of that, outsourcing will also help in saving time, effort, manpower, operating costs and training costs, enhancing overall cost advantage.