7 Factors to Consider for Successful Outsourcing of Product Development

Outsourcing is used by modern businesses of all sizes to make their software product development team more efficient and to fill talent gaps. You can outsource workers from nearly anywhere in the world, thanks to modern technologies making this a viable choice for enterprises of all sizes.

The most important thing to remember! Outsourcing will never be short on qualified people. Working with remote product development teams is no longer a trend or a vision of the future; it is now a reality.

According to the study, 74% of businesses are outsourcing IT services, with 87% expecting to maintain their use of IT outsourcing in the future.

External teams can assist in identifying new technology solutions and speeding up development at a reduced cost when contemplating outsourcing your IT services.

With outsourcing becoming more common, it’s crucial to understand what functions you might want to outsource and what variables to consider before making the switch.

Outsourcing Product Development

Outsourcing software product development is contracting with a third party to provide services and develop products formerly conducted in-house by the company’s staff.

It comprises product & technology development strategy, user experience design, ongoing product iteration & custom software development. Every outsourcing IT company provides unique services and specialties to assist clients in bringing their visions to life.

Many organizations choose in-house software development to outsource product development for various reasons, including

• A sense of helplessness in regulating and governing the growth process.
• Fear of losing one’s sense of security and intellectual property.
• Worry that an outsourcing agency may miss the underlying corporate culture & perspective embedded into products.

Why Should You Outsource Product Development?

Outsourcing product development is a simple decision when collaborating with the appropriate source. But how do you find reliable outsourcing IT services providers? Here s what you need to look for:

• Years of expertise in various industries.
• Client testimonials or an excellent product portfolio.
• Dedicated team with a wide range of experience & knowledge.
• A strong reputation, especially regarding trust and confidentiality. 
• A wide range of capabilities, including on-site tools, software, and machines.
• A willingness to work together with effective communication & collaboration.

The last point is crucial because effective communication or coordination leads to quality service. The more you collaborate, the better the developer will gain insight into your project needs and business goals.

7 Factors Affecting Outsourcing Product Development

1. Ensure You’re Working with a Reliable Outsourcing Company

Outsourcing product development expands your talent pool and allows you to hire the top product developers worldwide.

When looking to outsource your product development services, ensure you’re working with experts who know everything like work disciplines, emerging market trends, design practices, software stacks, and methodologies needed to bring a collaborative multidisciplinary workstream to life.

Typically, a software development outsourcing firm provides various services- Staff augmentation, dedicated remote team, IT consultation, and much more. 

For example, you can approach an agency with only a brief idea, issue statement, or vision and permit a full suite of services, including UI/UX design, CTO-level strategy, architecture, product development, quality assurance, and DevOps.

2. Affordable Services than In-House Development

A poll from last year states that the most common motivation for outsourcing (70 percent) is to save money. A company must build an IT department and invest time and money to develop autonomously.

Outsourced product development is usually less expensive than hiring, training, and paying the in-house team; you can save money while working with professionals.

Quick plug: Our dedicated team of developers has decades of experience helping organizations build Teams of high-quality IT professional/s (onshore, offshore, nearshore). They align well with your business goals and culture to provide high-quality software solutions. You can also reach out to us to build your team by learning more about our engagement models.

3. Faster Time-To-Market

Once a product idea has taken shape, getting a prototype to market as soon as possible is vital. Hire remote development teams with the right expertise, focus, and product iteration technique to help you go to market faster.

It can take months for a business to build a team of in-house professionals and establish a product development base of operations. On the other hand, outsourcing may allow you to complete your prototype in as little as a few weeks.

The ability to quickly release a product to market is a significant benefit of working with a strong product development organization. All you need to do is to make sure—

• You have a ready-to-go clear implementation plan & an understanding of how the outsourced IT team will interact with your company’s culture.
• You scale up your company before the market shifts. Outsourcing is also the most effective way to develop and scale software initiatives quickly.

4. Verify Past Experiences & Accomplishments

Verifying your Outsourcing partner’s certifications is another simple way to learn more about them. Many big brands, such as Oracle and Microsoft, provide certifications to their partners.

Rather than falling prey to marketing strategies, businesses might ask their partners to demonstrate their ability to work on projects for similar clients and the results of those initiatives.

Furthermore, these certificates show the product development partner’s technical talents and expertise.

5. Think About Pricing Alternatives

It is self-evident, given that no one who develops a SaaS product has ever had money to burn. So, you’ll keep a close eye on your budget throughout the development process. Keep in mind that the quality of your product and the degree of service provided by the outsourcing team are both critical considerations. 

If a little additional money saves you headaches, poor communication, or a botched launch, it’s well worth it!

Compare the estimates you receive from different teams to make the best decision. But, more importantly, don’t compare simply the numbers. Instead, learn how each company arrived at its proposed pricing. 

Pay close attention to the cost breakdown, and don’t be put off by what appears to be a prominent figure at first. Just be sure you understand everything that goes into that figure and why.

6. Effective Communication

The importance of communication in corporate operations cannot be overstated. The primary responsibility is to determine whether there are any synergies when speaking with the development partner.

Stakeholders, managers, and IT specialists must all be included in the communication process to share important and relevant information. Communication is a crucial aspect of a company’s strategy, according to 64% of companies.

7. Concentrate on Your Efforts

A would-be entrepreneur must consider many variables when beginning and running a business.

Assume that an aspiring business owner isn’t a finance expert, lawyer, human resources officer, or analyst. In that situation, carrying out these positions’ tasks will be difficult. As a result, it’s usually best to follow the advice of American business consultant Peter Drucker:

“Do what you do best, and outsource the rest.”

Choosing the right outsourcing partner with a track record of delivering quality software solutions that meet your industry’s objectives will help grow your business.

To Wrap Up

There will be challenges related to trusting an outsourcing provider, no matter the criteria. However, keeping all your management activities in-house is dangerous, especially if you lack experienced people or the technical skills required for complicated new product development or legacy product support.

To build a robust action plan, you must compare the rewards against the challenges for each scenario.