For agile software projects, our team at Technology Technology recommends using outsourcing services to keep up with early release and fast software evolution to meet market demand. However, some companies are hesitant to outsource their development projects because it is dependent on the time and material pricing model, where the total costs may remain uncertain and can even increase due to hidden costs.
Should you avoid outsourcing software development because the services may have hidden costs? Read on to learn how to minimize this problem and discover Trustify Technology’s software development outsourcing offer to see how we make such cooperation cost-effective.
Hidden costs can be frustrating, but in this article, we explain the sources which may cause or incur hidden costs and provide solutions for these hidden costs problems. For a more comprehensive solution, the pros and cons of outsourcing software should also be considered together with this.
Revealing the Hidden Costs of Software Outsourcing
Managing and Minimizing Hidden Costs in Software Outsourcing
What do you do with the hidden costs of third-party software development?
In general, there are two ways of outsourcing software development, on the market:
- Resource-level software outsourcing, including models like team augmentation or managed teams.
- Process-level software outsourcing (self-managed teams).
While resource-level software outsourcing may seem attractive in terms of cost savings, it also comes with significant hidden costs due to the lack of multi-skills expertise in these teams. Below, we outline the hidden costs associated with the resource-based software outsourcing process and describe how to overcome these costs in agile projects.
When Outsourced Teams Underperform
Poor performance which can be caused by lack of communication, high workload or fatigue, along with scope creep and technical debt, etc. as well as remote project management on your part could prove ineffective.
What to do: A vendor’s Project Manager works in unity with the outsourcing team, could help manage for better control over the project progress.
Scope Creep in Outsourced Software Projects
Changes in Agile software projects are bound to happen, but many changes happening at once can be the result of poor coordination between you and the outsourcing team.
What to do: Ask your vendor to have a built-in BA and UX designer in the project to analyze your needs and provide tailored features prioritization.
When Outsourcing Delivers Low-Quality Software
Offshore software outsourcing practices usually skip software testing and QA activities in order to save costs, but bugs and defects can happen and delay the whole project at the later stages of development.
What to do: As your vendor to integrate software QA into all aspects of the development project, from requirements analysis to development (unit testing) and software test itself (frequent regression testing, together with test automation).
Software Architecture in Outsourced Projects
A dedicated development team usually consisting of developers only (which is quite common when it comes to software outsourcing at resource level) can suggest unsatisfactory software architecture solutions and negatively impact the project lifecycle. A poor choice of architecture may require re-work later which costs even more money and effort.
What to do: Ask your vendor for an experienced software architect to suggest solutions and evolve software architecture efficiently.
Common Risks of Resource-Level Outsourcing and How to Avoid Them
- Thoroughly discuss your project needs
- Are there additional costs for process level software development outsourcing?
Check the vendor’s technical capabilities. Some companies overpromise results but fail to deliver once the actual work begins.
What to do: Start with a scope analysis and proof of concept to validate whether your idea can be developed into a real software product. You can quickly see how a vendor operates and whether their outsourcing process is compatible with the type of models you expect.
Navigating the Costly Transition to a New Outsourcing Partner
If your project is not going well and the vendor seems unlikely to be able to deliver what was promised, it might be time to look for another outsourcing vendor.
What to do: Draft a contract that requires the vendor to keep all resources (requirements, architectures, source code, tests, etc.) up to date and in the repositories that you manage.
Achieving Cost-Effective Software Outsourcing with Trustify Technology
To significantly reduce outsourcing costs in the long run, prioritize by choosing a vendor’s expertise and approach to delivery over cheaper cost.
Trustify technology – A top software development company in Vietnam can take over your project with our proven expertise and experience, resulting in significant savings to your project’s investment and enhanced outcomes.