When starting any online business, you inevitably face a choice. Hire an in-house development team? Or choose programming outsourcing? Like any choice in business, there are always costs—time, money, etc. The first option seems clear. However, the second option—choosing the outsourcing mode—leaves you with more choices to make and questions needing answers.
What does outsourcing mean? Basically, outsourcing means transferring selected responsibilities within a company to a third-party contractor. Programming outsourcing means an outside company with specific programming expertise works for them.
You can outsource computer programming partially or completely. If you choose partial outsourcing, you assign some tasks to a subcontractor. If you opt for complete outsourcing, the selected development team takes over the entire scope of a project.
Where to start and how to find a reliable outsourced development service provider?
You went with option two and decided to hire an outsourcing development company.
Where should you start? How do you choose the best provider? It will take time to have your questions answered. This short scenario might help you.
First, determine which region your future offshore partner works. North America, Latin America, EU, Eastern Europe, and Asia—all these regions offer a range of outsourcing software development companies.
For example, IT Craft’s development center is in Ukraine. Why? Because Ukrainian providers have already proven their professionalism. With strong engineering backgrounds of its employees, Ukrainian companies can satisfy needs of different clients with their programming outsourcing services. This can be fresh-baked startups, established businesses, and large enterprises.
Second, after you have chosen the outsourcing destination, continue your search in several ways:
- on Google using “outsource programming in Ukraine”
- in groups specialized in IT outsourcing via LinkedIn
- on Clutch.
Clutch is a rating platform listing IT companies experienced in outsourcing programming services. The rating of each company is reflected on a scale from 0 to 5. The rating is based on detailed feedback from former or current customers. You can read descriptions of the projects and scope of work a contractor worked on. You can also find a lot of insights. Use these to determine strengths and weaknesses of selected outsourcing development companies.
Why you should or should not outsource programming?
Programming outsourcing’s high popularity proves it is beneficial.
Benefits of outsource programming
Software developers located outside North America and EU countries charge considerably less. Their qualifications tend to meet the same high standards as those of developers in other countries. Thus, outsourcing of programming allows you to save money without compromising quality.
The picture below presents the hourly rates of the technical experts worldwide:
It is important to note that a low price does not mean the least-expensive option. Price is a fundamental factor in choosing a provider, but it shouldn’t be the deciding factor. When you compare risks and value of an offer built purely on the lowest price, the picture changes dramatically.
Opt for outsourcing when you need to quickly onboard a development team, organize a project implementation process, and get your product launched on time. However, we recommend allocating time to screen potential providers. Otherwise, time saved when choosing and working with the “wrong” contractor could be time and money lost. It might turn into a disaster—both for your pocketbook and your reputation. Check out our detailed roadmap on how to choose a provider: 6 Steps How To Find Programmers For Your Startup?
3 Freeing company’s resources
According to our observations, this is especially relevant for start-up companies. For example, the CEO or Co-Founder wears several hats. Such people need to focus on strategy and marketing while the selected outsourcing company focuses on project programming.
But there is a flip side to every coin. There are also disadvantages to choosing an outsourcing development company.
Risks of outsourcing
1 Lack of established communication and management
You need a good manager. You need a leader who constantly communicates with the outsourcing team. The product owner. The product owner understands the requirements and ensures the outsourcing supplier also understands. The product owner’s essential daily tasks include monitoring compliance with standards, reviewing source code, checking latest builds, examining error tracker.
Lack of constant management usually means the project could go out of control. Every outsourcing development company has horror stories about that. Customers hand off their list of requirements to assess and think their job is done—all they need to do is pay and the outsourcing company will do the rest. Development is not a can of Coke in a vending machine. Outsourcing programming is a process during which both the product owner and project manager at the outsourcing company must be actively involved.
2 Expected quality level
Anything less than your elevated expectations will be a disappointment for you. Of course, you can successfully finish different tasks with the help of an outsourcing company. But you need to clearly state the expected quality in advance. To understand the level of clients’ expectations, outsourcing companies should always invest time in communicating with the client during the pre-sale stage. They pay special attention to the analysis of business requirements. Mutual understanding turns into fruitful cooperation.
How to establish an effective programming outsourcing workflow. Our observations:
At IT Craft, we know successful project completion is not simply doing coding. Well-thought-out company processes mean assigning the right people with the right skills to the right projects at the right time.
People firstProgrammers develop software for people. Clear communication between designers, engineers, stakeholders, business, and product owners is crucial for success.
People who develop, maintain, and update a system need to understand how everything works. If this is server-side code of a complex system, other developers will read this code.
Source code must be well documented. Business analysts prepare documentation because it is important for other team members.
Give them what they need.
Learning is the keyThe most talented technicians always thirst for knowledge. Even during breaks, they enthusiastically discuss new trends and technologies. They read a lot—online and offline. They often try something new and learn from their experience.
IT Craft offers a specific set of services to our potential clients as part of our outsource programming: IT Outsourcing to Ukraine. However, most of our experts are not afraid to try new coding languages or new platforms. For this reason, IT Craft opened an IT Research and Development Laboratory, a place where anybody interested can realize their idea at the company’s expense. Practicing opportunities help our specialists keep their skills sharp. Our clients are happy we are at the top of our game, so they can be, too. This approach makes us different from our competitors and allows us to offer effective implementation paths.
PricingProgramming outsourcing is a process, not a finished product. Thus, it is difficult to almost impossible to give a straightforward answer. The costs of IT Craft’s services depend on the cooperation model selected:
Time and materials: The client pays for the time team members spend doing certain tasks. This option works very well if the project requires fast development and every single requirement is not defined in full detail. Instead, a high-level road map is available.
Price per unit: The service provider specifies the cost of the service and the customer pays to use it. For example, if you require support and maintenance for a web-based or mobile application, code review or server management, you either pay for a fixed number of hours on demand or a set sum each month.
Fixed cost: In this case, the cost of services is determined at the beginning of the collaboration. This payment model fits well only if the client has clear and final system requirements. On one hand, this model can be considered beneficial for the business, since it allows calculating the costs involved in advance. On the other, you should factor in additional charges for any extra changes no matter how small. Overall additional costs depend on the size and the number of changes requested.
Finally, do you want to know when outsourcing works?
This is simple. Success of outsourcing depends on the criteria you used to select the outsourcing programming company and how you manage the processes. You need a clear, detailed plan for managing the contract and ensuring quality control. With proper management, outsourcing is a great way for startups and established businesses to gain a competitive advantage by adding missing skills and experience.
Choosing an outsourcing programming company is a business decision that requires a detailed assessment and careful planning before making the leap.