Nowadays, companies belonging to various sectors need to use digital technology like never before. Regardless of the sector and scale of operations, businesses need to have a good online presence, and lots of operations take place online. In the last two decades, using software applications have become mandatory in the majority of companies. While licensing third-party software applications is an option, in some cases, that is not feasible. Companies belonging to sectors like healthcare, finance, banking and hospitality often need to develop customized software solutions. That explains why a lot of these entities opt for Software Development Outsourcing. Tying up with a suitable offshore software outsourcing company can be beneficial for any business.
The basics of Software development outsourcing
Outsourcing software development to an offshore company is not a radically new concept or practice. It was in 1989 that outsourcing was given the tag of a business strategy. In that year, Eastman Kodak opted for services of IBM for IT data center operations. It was in the late 1990s that the practice of outsourcing picked pace, and companies belonging from sectors like aviation, technology, healthcare all opted for large scale outsourcing. This trend seeped into the software development sector gradually.
Not every company, including some MNCs, have the time to develop in house software. Their scale of operation and complexity often makes them opt for offshore enterprise application development. Available data shows the global IT outsourcing sector is likely to reach $98 million by 2024. For the technology giants and bigwigs in other sectors, outsourcing software development is an effective strategy to stay competitive and keep costs under control.
Types of offshore software outsourcing
Offshore software development can take place in many ways as it is. It depends on the convenience and requirement of the company that has chosen to hire an outsourcing partner.
In some instances, a company may choose to hire an offshore software development company for developing customized software from scratch. The hired partner or offshore development company is solely responsible for developing the application, and it does everything necessary for implementation.
In some other cases, companies adhere to both in-house and offshore based models for software development. Both teams collaborate and develop the end product from various locations. Some companies also send their teams to oversee and monitor software development progress and cycles offshore even though the actual work is managed by the vendor company staff.
The benefits of offshore software outsourcing
There are numerous benefits of outsourcing software development to a third-party company located in a different country.
- Cost reduction - This is possibly the biggest reason for which the companies based in Europe and the USA opt for outsourcing software development. The cost of hiring native software developers is often very high. These companies can save a huge amount by hiring offshore companies, especially those based in Asia, for software development. For a fraction of the cost, they can hire offshore partners for software development.
- Time-saving - For the large companies in western countries and in the USA, saving time is important. They need functional, feature-rich software solutions. Developing such software in-house will affect their regular workflow, and that is not desirable. By getting the software developed in an offshore country, they ensure their usual workflow and productivity remain on track. The time required for developing a software application in the house is saved as well.
- Quality solutions - The offshore software development companies hired by the US and European giants are known for offering quality services, and they are very professional too. A number of these vendors are ISO certified, and their software solutions are known for quality, reliability and flexibility. So, the client companies can rely on the offshore vendors for quality software solutions.
- Convenient terms - The offshore software development vendors offer terms that are convenient for the businesses based in the US and Europe, in most instances. So, the companies get software delivery within the promised deadline, and they also get support from the vendors developing the applications.
How to pick the best offshore vendor for software development outsourcing?
It is important to use some parameters for assessing the offshore vendors offering software development services.
- Company profile and image - Before choosing an offshore software development company, the client company should check its profile. The vendor should have a solid brand image and choosing an established player makes sense.
- Client base and feedback - It is important to find out details about the existing clients of an offshore company offering custom software development services. It is necessary to find out the feedback of its existing clients. Checking out the testimonials on the company site is necessary, and it is also prudent to explore its social media profiles.
- Service terms - Before hiring an offshore vendor for developing custom software solutions, it is necessary to check its service terms. The client company has to check aspects like norms pertaining to the project deadline, exclusion clauses, payment etc. This is necessary to evade conflicts later.
- Pricing - The pricing of outsourcing software development varies from one country to another. Typically, the businesses prefer hiring offshore software development firms located in Asian countries for reasonable charges. However, it is not advisable to choose an offshore software development vendor based solely on cheap rate.
- Compatibility - The compatibility between both entities, as in the client and offshore vendor, also matters. If the in-house and offshore collaborative model is followed, time syncing is necessary. There has to be compatibility on the language front too. The time gap factor is important if the client seeks 24x7 support for the software.
- Safety and standard compliance - A company hiring an offshore vendor entity for customized software development needs to be mindful of these two aspects. Some client companies seek vendors with ISO 27001 and 9001 certifications. Clients belonging to healthcare and financial sectors have their own set of compliance requirements. So, it is important to see if the offshore vendor meets the compliance requirements or not.
Summing it all up
About the Author: Imenso Software
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