Spike was one of those control freaks who never want to delegate anything to anyone outside their IT company. Now, the only thing he has control over is a soft sleeping bag lying on the concrete.
Don’t be like Spike. Instead, be like the 60% of tech companies that will outsource part of their app development in 2021.
Okay, okay, if you decide to insource everything, you don’t necessarily end up bankrupt. However, you shouldn’t ignore the potential benefits of outsourcing, cause there is a good reason why that 60% of IT entrepreneurs plan to leverage such a possibility.
Actually, 4 good reasons. Do you want to know more about them? Here is the magic list… you are welcome!
1. Outsourcing to cut development costs
According to Captain Obvious, saving money is a good thing. And based on a survey by Deloitte, about 7 out of 10 companies choose to outsource precisely for this reason, i.e. as a tool to reduce development costs.
Basically, outsourcing strategies exploit economic differences between countries to lower labor costs.
Depending on the location of the chosen outsourcing company, it is possible to reduce the software development costs by several times. For example, a web developer in Eastern Europe can cost three or four times less than a US colleague ($ 35-50 an hour vs $ 100-150).
Fortunately, the wage differences by no means reflect less or greater competence of programmers, who can be great professionals even in countries with a relatively low cost of living.
“About 7 out of 10 companies choose outsourcing as a tool to reduce development costs.”
Some more tricks to optimize expenses
Cost-cutting is not just limited to a wage dumping issue. The savings also come from reduced expenses for equipment, workspace, training, sick pay, and software licenses. All of this will be paid for by the outsourced team instead of your company.
Just as they will be responsible for dealing with all the activities necessary for the recruitment of new talent, such as advertising a vacancy, hosting interviews, etc.
A final point that should not be underestimated, when it comes to optimizing expenses, is the possibility of changing outsourcing company if the first choice proves too expensive to maintain.
Such spending flexibility does not exist in purely in-house situations and can be further increased by negotiating with the external company the payment solution that best suits your needs in terms of deadlines.
2. Outsourcing gives you more flexibility
Delegating all those ancillary tasks mentioned above to highly qualified external professionals does not only mean saving money but also time and effort.
You will end up spending far fewer resources on recruiting, training new employees, and management in general. This way you can focus on the most important aspects of your projects, making the workflow much faster.
In addition to a general acceleration of work processes, outsourcing also brings much greater flexibility. That’s because working with an external partner it is much easier to expand or reduce the number of technicians dedicated to a project quickly and with fewer constraints.
You know, ending or changing the terms of an outside partnership is far less traumatic than firing your own employees, both in terms of human and company reputation.
Adaptability is a superpower!
This can be a huge advantage when it comes to managing peak workloads. In such situations, a company must channel all of its work to address a specific problem.
Having an outside ally, such as an outsourcing team, come to your rescue quickly can be a game-breaking solution.
Other unforeseen situations that can be easily managed with the contribution of outsourcing teams are the malfunction and downtime of internal computerized systems or a breach in the security of your data.
To deal with these unexpected events, it is a common practice to rely on external companies that can watch over the correct functioning of your systems.
3. Outsourcing can reduce business risks
When you outsource a software development project, you not only delegate responsibilities but risks too. In fact, outsourcing is an exceptional tool to mitigate the potential perils associated with product development.
Sure, market research can help you predict and avoid unexpected problems. But a certain probability of risk is taken for granted in doing business and is particularly dangerous for startups and small IT companies that have not yet developed a solid foundation and proven strategies.
Thanks to the support of an outsourcing team, software development will be managed by experts with effective workflow management and recognized skills.
Furthermore, this team will take care of resolving any unforeseen situations, which can range from the illness (and consequent absence) of a team member to costs and development times greater than planned.
4. Outsourcing offers a massive talent pool
The ultimate benefit of outsourcing in the IT industry is the opportunity to tap into an immense talent pool.
Thousands of professionals around the world are literally a click away from you and your company, ready to be hired without all the costs involved in recruiting in-house developers.
The almost total absence of spatial limitations represents a significant benefit in the era of COVID-19, due to all its dramatic implications. But it is also a valid approach to deal with the well-known and eternal shortage of qualified software developers to hire.
For insiders, it’s no secret that only a tiny minority of coders are unemployed and looking for a new job (6.4% of the 90,000 developers surveyed, according to the Stack Overflow Developer Survey 2019).
Outsourcing is cool… but use it properly!
Considering what has been said so far, it is no wonder that IT Outsourcing Industry currently represents a $ 92.5 billion market.
But … does this mean that outsourcing is always the best choice? Well, obviously not. Choosing such a path should always be done taking into account the pros and cons.
Undoubtedly, delegating software development to an external team leads to some more communication problems and a less “intimate” and more uncertain relationship. Basically, you don’t know for sure who you are dealing with.
“IT Outsourcing Industry currently represents a $ 92.5 billion market.”