Top 5 Risks of Outsourcing Software Development and How to Overcome Them

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Today, it is very easy to convert any business idea into reality. You can outsource your software development and get a ready product to market to your clients.

Sounds pretty cool, right!

No wonder the global IT outsourcing market will grow from $342.9 billion in 2020 to $410.2 billion by 2027. It will also keep growing as long as entrepreneurs and businesses need more software to be developed.

The present scenario should interest anyone to jump into the tech industry. However, is everything really so simple as it seems?

There are always risks when you outsource your development project. But you can also take a few steps to mitigate the risks and improve your chances of success.

Here are the top 5 risks you can experience when you outsource software development.

1. Not Knowing What You Are Getting Into

59% of businesses outsource to lower costs. As a result, offshore outsourcing is the more affordable choice.

However, how do you rely on an unfamiliar company in an alien country, like India? Will they even understand your needs?

What if they publish false claims on their website?

Your mind can start to buzz with questions when you want to outsource such an important task. It is not crazy to expect the worst when you are choosing your partner from the other side of the planet.

So, how do you sail past your apprehensions?

Solution

  • Do background research on your outsourcing partner
  • Use apps and software built by them
  • Arrange a video call and speak to the team
  • Research past projects completed
  • Seek feedback from past clients

Ask as many questions as you need to resolve your queries. The more you know, the better will you be able to lower your risks.

2. Delay in Meeting Deadlines

Deadlines are often missed. There is no way to deny this cold and hard fact.

Additionally, it doesn’t matter if it’s an in-house team or a remote development agency. The trend is visible in all software development teams across the world.

As a result, you may naturally worry about meeting your deadlines. What happens if your outsourcing partner goes off the radar?

It can delay your project, increase your time-to-market, and hold back revenues.

Solution

The best solution to avoid this development outsourcing risk is to work in sprints. In fact, agile development focuses on working in short sprints to improve efficiency.

Therefore, break up your entire project into smaller chunks. Develop your most important features first and then work on the rest of the deliverables.

This way, your development partner will be forced to deliver results. You can also easily stay in control of the project, which is another risk of outsourcing development.

3. Misunderstanding Target Market

Every product has a target market. For example, an eLearning app can target 5 – 15-year-olds to promote its courses and classes.

Understanding the target market is crucial for making your product click with your customers. However, will a set of people in a different country and culture understand what your market needs?

Solution

The world is more united today due to the internet. We may be sitting in Alaska and know what’s going on in Australia without any effort.

As a result, most development agencies in prime outsourcing destinations already understand your market.

Not only that, they most probably have already developed products for your market.

Therefore, you can choose someone with exposure in your industry for complete peace of mind. For example, if you have a healthcare app to develop, look for an agency that has developed such apps before.

In addition, establish concrete deliverables before outsourcing your development. It will help your project stay on course and produce results as expected.

4. Technological Disparity

Development is a vast area. You can use an endless range of languages, frameworks, and tools to achieve your objectives.

Most importantly, the tech stack you use has a direct effect on the quality and performance of your software.

However, not all development agencies have expertise in the same technologies. As a result, your project can suffer if you choose an outsourcing partner that uses a different tech stack.

Solution

The best way to avoid this risk is to speak with the company directly. Enquire about the tech stack your partner uses and whether they have exposure to your chosen technologies.

In addition, find out the type of tech stack the agency used for past projects. Read the case studies of each customer to develop a better idea if they are the right match for your needs.

Additionally, find out if the developers keep themselves updated on the latest development trends.

5. Lack of Experience in Remote Collaboration

Working remotely has become a norm around the planet. Even before the pandemic, remote work grew by 159% in the previous twelve years.

However, not everyone is comfortable with remote working. Many entrepreneurs also feel the same way and are cautious of outsourcing to an offshore location.

What if your chosen partner stops communicating? How can you track the progress of your project?

Solution

Remote working is not a challenge anymore. There are several resources and tools that can allow businesses to collaborate with a remote development team.

For example, you can use tools like Zoom or Slack to stay in touch with your outsourcing partner. In addition, you can use project management tools to collaborate across borders. They will also help you track your progress and where your project stands.

Therefore, remote collaboration is not a risk if both parties are committed to the project.

Final Thoughts

Outsourcing has its share of risks, like any business venture. However, the risks never outweigh the perks of outsourcing your software development. A few steps can ensure you get the same or even better results than developing your product in-house. In the end, make sure you join your hands with a reliable development agency like Wizard. We have the best team of leading developers to bring your business success. You can always get in touch with us to ask any questions or discuss your concerns. We are always here to resolve your queries and help you rest your worries.