Why Outsourcing is the New Normal in Software Development

There was a time when less than 5% of the total work population of the USA were working remotely. Now we live in a different world. The covid 19 worlds where billions of people are under homebound and under lockdown. This has brought about a massive shift in the working conditions, and we are on the verge of a long-term work culture change. 

While the idea of remote working is not new for experienced freelancers, the teams which have been working in a constant face-to-face interactive environment are new to this arena. Software development teams are one of them. 

Covid 19 pandemic has truly changed the face of work worldwide and brought outsourcing to the forefront of software development. It was always a close working affair for software development and businesses managing them. But now, there is another option that many companies and enterprises have been choosing - outsourcing. 

What is outsourcing in software development?

When a company or business hires an offshore partner to build software solutions, and products it is termed outsourcing. 

Let's understand with the example of Apple. The tech giant has offices and staff in many cities across various countries. What's the need? They can design their products in California with all the staff hired locally. But it's not the case. Two main reasons companies opt for outsourcing and expanding their business in other countries are the high cost of hiring in-house employees and the easy access to world-class talent. 

Now Apple is an MNC. But if you think about how small and medium can apply the same logic and technique of outsourcing their IT needs to save time and money. 

Now in the wake of the coronavirus pandemic, developers are working online anyway, so why not save some capital and get the same quality product at a lower price. 

Reasons why outsourcing is preferred over in house software development 

Subject matter expertise

Companies outsource software development projects only for reduced cost is not entirely true. There are other aspects to this as well. Many companies outsource today to take advantage of special knowledge and skillsets and gain the expertise which the in-house team is lacking. 

But again, we come to the lower cost conclusion as hiring a dedicated expert via outsourcing is far more cost-effective relative to the cost of hiring an employee with similar skills full-time.  

No extra costs and faster deployments 

Another good reason why software development outsourcing is trending is that software development outsourcing companies complete the job at predetermined deadlines and with the assured quality even during any overhead expenses or uncertainty. Software development companies who outsource their projects or parts of their projects are more focused on their core expertise and thus maintain a good pace of development, testing, and deployments. 

And as there are no delays in development, there are no delays in deployment to the market. 

More focus on core business capabilities 

Any business is successful because, collectively, they're clear about their goal. Without the clarity of what the team is trying to achieve, collaborative efforts from everybody are difficult. Focus is very important for any business. That is why many software companies choose to outsource over in-house development teams so that domain experts work their magic to complete a project in a shorter period. 

This gives businesses and in-house teams to focus on their core business expertise like production and marketing. Software development outsourcing is the key to grow a business in a short period. 

Risk management 

Software development companies, as you know, are hired to manage every aspect of the project development without actually being on the payroll. So there is a minimum possibility of risk of any employee leaving before project completion or server breakdown, or other glitches that might occur. It's the responsibility of the offshore company to handle all aspects of software development. 

Still not 100% convinced that software outsourcing is the new normal in the IT industry? 

Here, look at some mind-blowing facts that let you know how the world of business is changing via outsourcing. 

Here are some crazy facts to change your mind about outsourcing 

• According to a study by compare camp, more than 94% of companies outsource their software needs. This percentage includes many IT companies as well. Several custom software development companies provide reliable, affordable, and scalable solutions for both non-tech businesses and IT businesses. 

• As per a Statistareport, the size of the IT industry is estimated to grow up to $413 billion by the end of 2021. More than 70% of these statistics will come from outsourcing.  

Many businesses recognize that technology is evolving fast but fail to act at the right time. To beat the competition, it is necessary for both big and small businesses to optimize their internal processes. And IT outsourcing is the way to do that. There is no doubt that the software outsourcing industry will grow more significantly, and there will be more strategic partnerships between parent companies and outsourcing companies. 

• Manufacturing companies outsource 70 - 80% of their finished products. 

Earlier in the blog, we saw an example of Apple with manufacturing plants in different parts of the world. This is a proven strategy used by other big manufacturing companies from different industries. The cost factor is the primary reason for outsourcing outside companies to build and assemble products. 

• India has the leading edge in global IT outsourcing. 

India is the most mature market for offshoring. Over the years, India has emerged as the best choice for software development projects, including web development and design, mobile app development, data processing and visualization, and other top-level services. 

India has a very sought infrastructure for software development and technical support teams. The outsourcing services in India are much cheaper with the assurance of quality. It costs way less than employing a group of local talent. 

The outsourcing industry is expected to grow bigger and better in the years to come. 2021 is the right time to grab this opportunity for your business and beat your competitors to it. To get more help and information about getting started with software outsourcing for business, contact our offshore custom software development agency. We would love to help you solve your business problems.