Setting Yourself Up for Success When Outsourcing Technology | Part 4

Innovation through advanced technology impacts a company's ability to compete in a digital-first environment. However, without the technical talent to implement this newer technology, many companies lag behind. Outsourcing is a great strategy to overcome this challenge. This approach has several benefits including faster time-to-market, increased revenue and improved product quality. In Part 4 of our series, we focus on strategies to set your company up for success when outsourcing software development. With the right approach, you'll find an outsourcing partner that adds maximum value to your business strategy. 

Evaluate Your Corporate Goals

Check your corporate roadmap. What are your long-term goals and objectives? What are the short-term goals and objectives? The answers to these questions are essential to success. Your corporate goals provide the foundation for building your project requirements. Having a clear understanding of your goals keeps everyone on the same page as to the ultimate result which is to provide business value. Prioritize these goals to ensure you work on the most important items first.

Though reasons for outsourcing differ from industry to industry, there are five main reasons why companies choose outsourcing, as addressed in Deloitte's2020 Global Outsourcing Report:

• Cost (almost 70% of companies)
• Flexibility (40% of companies)
• Speed to market (20% of companies
• Access to cloud-based tools and process automation (about 15% of companies)
• Agility (about 15% of companies)

Define Requirements

According to McKinsey's Harry Robinson, 70%of digital transformation projects fail. 

A fundamental idea of what you want to build is essential before diving into your search for an outsourcing partner. Ask yourself questions like: is the concept tried-and-tested or brand new? Does it have proof of concept (POC)? What technology will you base the software on? What problem will it solve for its intended audience? Defining requirements gives a benchmark to track progress and measure performance. 

You can use a requirements document to define the scope of work and what you want your outsourced vendor to do. The document should contain the following information:

• Scope: What you want to achieve
• Audience: Who will use the product
• Expectations: A high-level description of what you expect from the vendor, including their capabilities and resources
• Estimate: Both time and cost 
• Quality Standards: Defines expectation for meeting quality standards

Choose a Suitable Outsourcing Model

The outsourcing model that meets your project's requirements depends on factors such as time, budget, and complexity.

Project-Based

The client and the vendor work together to define the scope of work, and then a contract is signed. The vendor takes responsibility for all aspects of the project, from design to implementation. This approach means hiring an entire development team. Here, you collaborate with all the professionals you need.

Team members might include:

• Developers
• Business analyst
• UI/UX designer
• QA engineer

A project begins with Discovery and consists of:

• Gathering Requirements: Review requirements from the team members listed above.
• Tech Specifications: The specification is a detailed document that describes functions, required technologies, and their dependencies.
• Designing Wireframes: A wireframe is a simple black and white layout that outlines the user interface.
• Providing an Estimate: This document describes the timing and cost of project development.

Dedicated Team

This approach means you have an entire remote software development team dedicated to your project. Teams are assembled based on your specifications. You can choose whether the project manager oversees the work or if the team reports directly to you.

Staff Augmentation

Staff augmentation lets you bring in an external provider at any point of the project. The team works remotely to augment your internal team. This is the most flexible option and gives you more control over your project and resources. This approach doesn't suit long-term projects because team members are only temporary.

Choose the Right Outsourcing Partner

Ensure the company you choose is interested in enhancing your business through its niche expertise. A good software development partner gets to the core of your business to understand your goals. They should be interested in understanding your core audience and how your product provides value to your customers. The best partner will use this information to add value to your business to help you get maximum value from their services. Here are a few additional factors to consider.

Available Resources

Your outsourcing partner should have a strong pool of engineers who can quickly recruit and assemble a team for your project. The speed and quality of candidate sourcing are critical for the project's success.

Security, Privacy, and Compliance

Security, privacy, and compliance are crucial to business success. Make sure the software development provider you choose makes security a priority. Ask them how they protect sensitive data. Also, ask if they can meet regulatory requirements for your industry. Examples include Payment Card Industry Data Security Standard (PCI DSS) or the Health Insurance Portability and Accountability Act (HIPAA).  Many certifications have tools for you to verify certification or compliance, like this one for HIPAA.  

Skills and Technologies

Depending on the project, you’re likely to need a particular set of skills to bring it to life. Ensure the partner you select has advanced knowledge of the technology you require. A team with technical expertise optimizes the output and efficiency of the development process. Hiring experts is invaluable for avoiding pitfalls, unlocking opportunities, and creating productive work practices.

Project Approach

Evaluate their methodologies and techniques. The waterfall method is a type of project approach. The waterfall approach can take a long time, but it works best for large projects with multiple dependencies. The waterfall model involves a series of steps, from idea to implementation. You can’t start the next phase until the previous one is complete. 

Waterfall projects are best when there are significant technical hurdles or dependencies between tasks. This is not a solid approach if you want to innovate and move quickly.

Agility does. An agile approach allows your team to move faster and retain the ability to pivot when necessary. With an agile approach, you typically get regular feature releases, often every two weeks. At this point, verify that your outsourcing partner values providing clean and well-documented code as it minimizes chances for bugs and makes long-term maintenance easier. Ask if they have standard coding procedures and a code review process.

Communication Plan

Variables of the partner's location, such as language, time zone, and culture, can impact daily operations. Consider how the partner’s location may affect communication and workflow. Develop a communication plan. It should include things such as how they provide updates, frequency of updates and procedures for submitting updates. It should also address procedures for contacting the provider in emergencies.

Industry Experience

When choosing a partner for your outsourcing initiative, look for industry experience. This means your partner can understand your business goals, help identify pain points in the current process, and tailor a solution to meet your needs. A partner that's well-versed in your industry can provide verifiable references from their current or prior clients in the same industry as yours.

Takeaways

The goal of every business owner is to create innovative products, get them in the hands of customers quickly, and drive profit. Doing so requires agility and speed that many companies don’t have. Outsourcing your software development gives you the flexibility to implement the emerging technologies customers expect. Are you ready to explore outsourcing? Contact us to learn how our team of experts can add value to your business by giving you the flexibility you need to remain competitive.

‍