Do you use software to run your business operations? Which business doesn’t these days for efficiency and competitive advantage? You probably struggle to maintain, upgrade, and build new features in your software applications. If yes, you have three primary choices: Hire a team of software engineers, adopt off-the-shelf software, or partner with an outsourcing company. Among all the three options, partnering with an outsourcing company is most commonly used by companies as it offers great benefits such as access to skilled resources and world-class technology, cost-effective solutions, time to market, flexibility, and focus on long-term strategic plans!
According to Statista, the global market value of software outsourcing is estimated to reach $430 billion by 2023, with software development outsourcing anticipated to grow by 70%. Business Process Outsourcing (BPO) has revolutionized the market due to immense progress in outsourcing competencies. Contrary to popular belief, cost savings are not always the key factor driving businesses towards software development services – it is also about leveraging expertise and capitalizing on innovative solutions!
This blog discusses various reasons companies outsource software development to gain a competitive edge and consolidate their market position.
1. Focused Business Development Strategy
Having a focused business development strategy always lends an advantage to a business and helps it sustain itself in the market; however, spending more time and effort on activities that are relevant to business operations but outside the core business strategy could be counterproductive. This is where most businesses go wrong by channeling their limited resources and time into software development and the technologies involved. By partnering with a software development outsourcing partner, a business can focus more on the core business development strategies such as exploring new target markets, brand building, and research and development to continuously innovate its products and services to provide value to its customers. The technology part of software development is taken care of by the outsourcing partner, who can utilize their expertise to provide advice and guidance to business leaders to help them through cutting-edge technology trends.
2. Reduced Time to Market
Companies can build and release products more quickly by outsourcing software development than they can do themselves. This is because businesses can access a larger team of developers who can hasten the development process through outsourcing. Companies can accomplish projects more quickly and effectively by working with a team of developers who are skilled in particular fields. Also, it enables businesses to be more adaptable in their product creation. They may scale up or down as needed using an outsourced crew, which can speed up their response to shifting market demands.
By enabling businesses to create and introduce new goods and services more quickly, outsourcing software development can help them acquire a competitive edge. Companies may decrease their time-to-market and stay ahead of the competition by working with a team of competent developers with access to the newest technology and can offer adaptable solutions.
3. Risk Sharing
Companies can share responsibility for the project’s success with their outsourcing partners by outsourcing software development. Ensuring that both sides are dedicated to the project’s success can assist in lowering the risk of failure. Regarding software development, outsourcing partners frequently offer knowledge and experience that businesses might not have in-house. Companies can lessen the risk of failure and increase the likelihood of success by working with an outsourcing firm with a track record of successful software development projects. Outsourcing partners can help companies scale their software development projects as needed. This can help reduce the risk of over-investing in a project that may not be successful or under-investing in a project with the potential to be highly successful. Outsourcing also mitigates the risk in quality assurance as outsourcing partners often have processes and systems in place to ensure the quality of their work. This can reduce the risk of software bugs and ensure that the final product meets the company’s requirements.
4. Cost and Time Savings
Cutting costs while minimizing workload is one of the major reasons why companies outsource their software development needs. Companies that handle every aspect of their business in-house automatically pass these costs onto their customers. By partnering with an outsourcing company, companies can get the same quality work at less cost, improving their competitive position. Delegating responsibilities gives companies more time to work on their core business functions and aids in the reduction of infrastructure, training, software, hardware, cloud infrastructure, and software licensing costs. Almost 70% of all companies outsource software development to reduce cost objectives. Even considering the most conservative estimates, even a small business can save tens of thousands of dollars annually through outsourcing.
Outsourcing software development helps businesses gain more flexibility in deciding the team size based on business requirements. When a particular project is going well, and the need for accelerating its development arises, or additional features or personnel need to be added that aren’t in the original plans, software development outsourcing allows the freedom to pivot quickly and efficiently. It enables businesses to evolve as per the changing technologies and market without worrying about the rising hiring and training costs and other financial investments. It streamlines the company’s focus on more critical business processes that are essential for the success of a business and allows businesses to respond to changes with a quick turnaround time.
6. Access to Skilled Resources
Outsourcing software development allows companies to tap into a wider pool of talent. By working with an outsourcing partner with a team of skilled developers, companies can leverage their expertise to improve the quality of their software, bring products to market faster, and use their expertise in specific areas of software development. They can develop software that meets their specific requirements and is tailored to their business needs. It allows companies to build internal capabilities by transferring knowledge and skills to their in-house teams. This can help companies improve the quality of their software and ensure that they have the right resources available to complete projects on time and within budget.
7. Access to World-Class Technology
The technology stack undergoes significant change each year, and companies are unfortunately unable to master all of that. As a result, outsourcing is required to utilize the most recent technology stacks. Outsourcing partners often have expertise in the latest technologies and can provide access to the latest software development tools and platforms. This can help companies stay up-to-date with the latest trends in technology and ensure that they are using the best tools available to develop their software. It allows the development of software using specialized expertise in emerging technologies such as artificial intelligence, machine learning, and blockchain that leverages these technologies to gain a competitive edge. Outsourcing provides access to specialized hardware that companies may not have in-house, such as high-performance servers or cloud computing resources. This can help companies develop software that requires advanced computing resources, improve the performance and scalability of their applications, and improve efficiency.
Outsourcing for software development at start-ups is expected to increase by 70% between 2022 and 2023, according to new research from Commit, the leading global tech services company focused on custom software and Internet of Things (IoT) solutions.
Today’s IT landscape is ridden with skill shortages, budget constraints, and constantly changing technologies. To address these challenges, an exceptional team is required to deliver application development, maintenance, and support seamlessly. However, despite the global market being awash with world-class IT development companies, very few have the breadth and depth of skills and resources to address these demands. With over 18+ years of experience, iQuasar helps companies to realize their technology transformation vision by offering high-quality, cost-effective solutions to even the most complex business issues.