S3Corp. Tech Blog

Outsourcing software development has become a familiar concept for any business owner/entrepreneur. And they all agreed that this service can scale up their business and be part of their business strategy. However, when deciding to build a software project, you might wonder which practice you should follow. Whether hiring a forming a new full-time in-house development team or just simple handling it to the software development outsourcing company.

Both are good and they can handle your project. Yet, they have their advantages and disadvantages. Let’s dive into the following comparison to know which one will suit you depending on your industries, requirement, etc.

Definition

Outsourcing software development is a practice of hiring external resources to handle complex tasks requiring software or programming skills. This practice can help you reduce the stress of cost-spending, deliver the project on time, and focus on your core business.

In-house software developers are the practice of hiring developers or forming development teams to work directly for organizational usage such as maintaining the system, building a new digital product. This practice can help you clear the language barriers, personal/deep involvement in the project. Yet, in-house developers should only apply when your projects are part of the core business functions.

Now, let’s analyze the pros and cons of these two practices

In-house development team

Advantages

• Managing team directly

The in-house teams could be interviewed and accepted by you. Hence, you know the capabilities, strengths of each one. It can help you to assign tasks accordingly. Because the team will work in the same place as you, it can be easy to manage the team and the development process. If any issues are detected, the team will know why and how it happened, or who should respond to that.

• No culture boundaries 

The software developers in your team probably live in the same country with the same culture. Hence, they can understand the culture, how it will affect the users/customers. and adapt it according to the specific business needs.

• Deep involvement

As a part of your company, the development team will have a sense of belonging. This sense can help them to dedicate themselves to the productivity of the project and seek out the way to improve it. The more its success, the more job satisfaction they are.

• No language barrier

Most of the internal software development teams are in the same country- except you are hiring foreign employees. Hence, it can be a great advantage for your project because it will reduce the risk of miscommunication or misunderstanding your requirements. Moreover, the development teams will work at your office at the same working time. This can help you get into the face to face discussion more simple and clearer.

Disadvantage

• High cost

Here means the operation cost. And it is quite expensive. What you have to spend for full-time software developers is various such as regular salary, health care insurance, sick leave, vacations, and many other things relating to C&B, recruiting, and training. Besides that, the cost for IT infrastructure would also be a big issue to you such as software, hardware, network, development tools, etc. It sounds the same as other employees. Yet, for the software development process, it truly costs you more than that.

• Staff jumps the job 

There are many reasons for a software developer to change his/her job frequently. It could be they find other attractive offers from other companies-even your competitors. It could be they find a higher position with an attractive salary. Hence, staff quit their job frequently is the fact that you need to face them. To fill out the blank position, you need to constantly recruit the new one. The result will be time-consuming for the project and even it can affect your whole business and your revenue.

• Limited Expertise

The shortage of IT talented with special skill-sets makes the recruiting process becoming more difficult and challenging than ever. It’s really hard to gather all the skills and significant roles in a development team. Sometimes you might get enough developers for a project but the arising problems or complex tech tasks can cost you more money on hiring and training, especially if your project is requiring a niche technology. Beyond that, it can decrease the speed of the development process. Sometimes you might get the right one with technical needed skills, but they can’t handle the workload and task-assigned. Later on, this can make the whole process becoming more complex.

Outsourcing software development

Advantages

• Cost-effective 

Outsourcing development can save you 90% of cost-operation-this will depend on the types or models of outsourcing. If the hire in-house software developers can cost lots of money, outsourcing services could be a doorway for cost-spending issues while you still can achieve your software development goals without breaking the budget. Once contracting with a software outsourcing company, the only fee you need to care about is the monthly or hourly fee (depending on the contract with the outsourcing company). The software development company will pay for recruiting, training, or retaining software developers and even IT infrastructures. These savings will help you with other business activities.

• Scalability and access to the talented pool

The IT shortage specialists can become trouble for finding the niche skills and experts needed.

Here, if you are struggling with an IT talent shortage, outsourcing software providers can help to access the talented pool of developers. Moreover, it allows you to scale up/down your development team depending on your requirements and your needs. Flexibility is the key. You can request to add some more developers to the projects if your deadline is at hand and need more hand to handle to workload. Meaning to say, you can ask to scale down the development team if your budget is running out.

• Faster Time To Market

The experience and talented resource can be a promise that your project will be deployed on time. This will help you to reduce development costs and many other issues.

Disadvantages

• Miscommunication issues

Outsourcing development teams will work from outside of your company-except the augmentation staff, you have the right to ask them to work at your office. Hence, the common communication channel would be via email, instant message, video conferencing, with the support of other tools like Jira, Slack, Trello, etc. Sometimes things just don’t stop at distributing tasks. You might need to explain more about it. And the translation might bring both into miscommunication, especially when it comes to technical terms.

Read more:

Remote Development Teams: Manage your team effectively to ensure the best results

• Security Risk

This might not a big deal if you partner with a reputable outsourcing software development provider like S3Corp.. Yet, whoever you will contract with, signing an NDA can ensure that the software development company will not use any of your ideas/data.

Last words

Developing a software project might not as easy as it is. Choosing between in-house and outsourcing development teams might not easy tasks. Each one has its pros and cons. Spending time with your business team and discussing which one would be suitable for your project and your business.