Outsourcing software product development isn’t always easy for businesses with limited resources. However, it’s often a necessary choice if the company wants to make its ideas happen—and benefit along the way.
In this article, we explore the essentials of launching an effective outsourcing project and finding a reliable software development partner for your product. But first, let’s see why you should consider outsourcing.
Top 6 benefits of outsourcing software product development
According to Deloitte’s Global Outsourcing Survey 2022, 79% of companies outsource their app and software development. As much as 57% of organizations do it to cut costs, 51%—to adapt business strategy to operational shifts, and 49%—to gain access to new capabilities. Here’s what businesses receive when they do it successfully.
Better cost optimization
Outsourcing allows businesses to leverage the cost-effective labor markets of outsourcing destinations, reducing development costs significantly compared to hiring in-house teams from the same country. For example, for a US business, delegating product development processes to reliable tech teams from Latin America is more cost-effective than hiring a product development team in the US.
Quick access to skilled talent
Outsourcing provides access to an international talent pool of skilled software developers with diverse expertise and experience. It allows businesses to find the right talent for their project requirements. At N-iX, the staffing process lasts 4-6 weeks, depending on the role you need to cover, the technology you’re looking for, and your optimal skill level.
Ability to focus on core business activities
By outsourcing activities like software development, businesses can focus primarily on their core competencies and strategic initiatives, enhancing overall productivity and competitiveness. For example, a company might outsource the development of a commercial app, allowing its in-house business unit to do in-depth target market research and build a solid product strategy.
Faster time to market
In a business environment, speed is critical to launching effective marketing campaigns, reaching more users, securing market position, and outperforming the competition. Tech companies often have the resources and expertise to accelerate your project timelines. This way, software product development outsourcing enables faster development cycles and shorter time to market for software products.
Scalability and flexibility
Outsourcing offers scalability and flexibility, allowing businesses to quickly scale their development teams up or down based on project requirements. It also frees the company from the constraints of hiring and managing in-house staff, which takes additional resources.
With a reliable tech partner like N-iX, you can manage the scope of services and team composition at each product development stage.
Risk mitigation
Outsourcing partners often take responsibility for project risks, including technical challenges, talent management, and delivery deadlines. Also, an outsourcing company usually has established processes and protocols to address technical issues, ensure timely delivery, and manage communication effectively. This approach decreases the burden on the client and mitigates respective risks. It allows businesses to control their progress without diving into details.
These benefits sound appealing to any business wanting to maximize their investment and develop a profitable product. Here’s what you need to do to gain them.
Read more: How to get outsourced product development right
Best 5 tips to succeed in outsourcing software product development
An effective strategy will vary from business to business, depending on business goals, market conditions, available resources, desired timelines, and others. These five steps should be your starting point for tailoring a unique approach for your specific product.
1. Define your needs
Defining project goals, needs, requirements, and expectations upfront ensures alignment between the outsourcing partner and your business objectives. When outsourcing software product development, identify how much of the development processes you want to delegate to your partner initially and in the future. It will help you build solid business growth and product maintenance strategies.
In addition, make sure to list out all needs and goals, as overlooked ones increase the risk of scope creep, resulting in budget overruns and missed deadlines.
2. Prioritize flexibility and scalability
Ensuring scalability and flexibility is essential for aligning with evolving market demands and accommodating business growth when you outsource software product development. By prioritizing these aspects, companies can optimize resource allocation, maintain competitiveness, and future-proof their investments.
Moreover, this strategic approach fosters agility, responsiveness, and sustained success in today's dynamic business landscape.
3. Assess your tech infrastructure and team capacity
Once you know the product needs and project scope, it’s time to assess your tech resources and team capacity. These parameters will define what will be outsourced and done in-house.
Identify whether you need partial support at a specific product development phase or full-cycle product development before you start looking for a tech partner. This approach can help you use your budget more effectively and choose the product software development company to help you scale up or down.
4. Choose the most suitable outsourcing options
Nearshoring, offshoring, or onshoring options are all suitable for software product development outsourcing, though you have to review your business strategy and goals before choosing one.
For example, if you want to outsource a part of product development processes and want to have a smooth collaboration and timely communication with your extended team, it’s best to opt for the nearshoring model. This outsourcing option has many other benefits, such as proximity to the target market, cost efficiency, quick access to a broader talent pool, and more.
Alternatively, if you decide to fully outsource your product development project and provide feedback on results rather than the process, you may consider an offshoring model. It will help you save more costs on hiring and development. Usually, you’ll communicate with a dedicated project manager who’ll report on project progress and pass your feedback to the team.
5. Find the right partner
Once you’ve decided on the outsourcing option, it’s time to find a trusted tech partner to deliver the expected results. The choice will depend heavily on what you’re going to delegate to them, as vendors offer various services when it comes to outsourcing.
For example, some companies may only offer end-to-end software product development. In contrast, the ones like N-iX are more flexible with their offerings and can cater to your specific needs. If you want to narrow down the list of software development companies to choose from, here are a few things that reliable tech partners possess.
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Top 9 features of a trusted partner for outsourcing software product development
According to Deloitte’s Global Outsourcing Survey 2022, transparency, trustworthiness, and understanding of their business were the top three qualities the companies value the most in their outsourcing service providers globally.
While these are essential factors to rely on when choosing the best tech partner to outsource software product development, they aren’t the only ones to consider. Here are nine more indicators of a trusted tech provider to rely on.
1. Tech expertise
Businesses with a disruptive software product idea must find an experienced partner with the tech expertise and skills to turn the idea into a highly functioning, usable product. However, the company should be well-versed not only in engineering but also in market research, prototyping, user testing, and so on.
At N-iX, we have all the resources to help you develop and grow your product. We offer product management consulting, Product Discovery, and various software engineering services. Our company also specializes in data analytics, cloud technologies, AI, ML, and Data Science to create a successful product.
2. Experience in product development
Tech vendors with a proven record of software product development outsourcing for companies from various industries should score additional points. Such vendors have developed typical product management workflows and gained industry-specific market insights that can benefit your project outcomes.
N-iX has vast experience in Product Discovery and software product development for large enterprises and Fortune 500 companies from finance, banking, ecommerce, telecom, automotive, healthcare, and other industries. It helps us kick off any project faster and more efficiently.
3. Extended market presence
There are a few advantages of software development partners having access to product engineers, BAs, and product managers in different regions:
- They can find the required specialists faster, shortening the time to market.
- You can choose the most convenient outsourcing location and set up uninterrupted collaboration workflows within the same or similar time zone.
- It increases the chances of hiring specialists with niche skills faster.
N-iX has expanded its global presence to Ukraine, Poland, Colombia, the UK, the US, Sweden, Malta, and Bulgaria. We hire top talent from 25 countries, including Poland, the USA, Colombia, Germany, Canada, Ukraine, Romania, and Bulgaria. It helps us cover the software product development needs of businesses from any industry across Europe and the Americas.
4. Reputation and high customer satisfaction rate
Another quality sign to look for is verified customer reviews and testimonials from top market players. If the company is highly ranked on websites like Clutch, has testimonials from past or current clients on its website, and is a regular participant in global tech conferences, it only proves its trustworthiness and professionalism.
With a 4.8 review rating and over 30 client reviews on Clutch, industry recognition from IAOP, GSA UK, Forbes, and Forrester, and over 160 active clients across the globe, N-iX has gained a reputation as a reliable partner that businesses can count on.
Read more: How to choose the right software development partner: your outsourcing handbook
5. Transparency in communication
When outsourcing any project, timely and clear communication is essential for success. Pay close attention to how the company communicates before you sign any official service agreements, as it can give you a glimpse of what it will look like during the cooperation.
N-iX understands the importance of communication for companies outsourcing software product development. We ensure you always receive project updates and can choose the meetup schedule that serves you the best.
6. Focus on quality assurance
If the software product outsourcing company prioritizes quality assurance (QA) throughout the development process, it helps ensure product reliability, cost efficiency, customer satisfaction, and regulatory compliance. As a result, it contributes to the overall success of your software product initiatives.
At N-iX, QA is embedded into our product development practices. We follow an agile approach towards product design and development, allowing us to build, test, and improve the product continuously.
7. Security and compliance
Prioritizing security and compliance when selecting a software product development company for outsourcing is essential to protect sensitive data, comply with regulatory requirements, mitigate risks, build trust, and ensure long-term project success. Make sure the vendor has all the needed security certifications and is compliant with the data processing regulations of the target region.
N-iX holds certifications such as PCI DSS, SOC 2, FSQS, CyberGRX, ISO 9001:2008, ISO 27001, and ISO/IEC 27701:2019 and prioritizes adherence to data protection policies and standards to maintain the highest level of security throughout its operations. We’re also a GDPR-compliant company, building our processes within the data protection framework.
8. Long-term partnership potential
The product development life cycle requires constant support and maintenance for the product to be ever-relevant to the business goals, customer requirements, and market trends. So, it’s essential to partner with a tech company that fosters long-term business partnerships and can provide you with the needed services for years to come.
We focus on delivering long-term value by providing high-quality services to our clients and researching new ways to improve their products and secure continuous market success. Such an approach helps us grow long-lasting partnerships with global enterprises and Fortune 500 companies.
9. Variety of cooperation models and services
No software product development process is set in stone, so it’s essential to partner with flexible software companies that can modify the services provided depending on your business needs. And those vendors offering various cooperation options are more likely to provide such flexibility.
N-iX offers Extended team, Managed team, and Custom Solution Development cooperation models. Each allows you a different level of involvement and management so you can choose what’s best for your project.
Why choose N-iX for software product development outsourcing?
With over two decades of experience, we’ve successfully delivered various IT projects to enterprises and Fortune 500 companies and earned recognition from CRN in the Solution Provider 500 ranking.
We offer various cooperation models and services , such as Team Extension, Managed Team, Custom Solution Development, and Tech Consulting. With an established global presence across the EU and the Americas, we can cater to your business needs in different markets.
We have over 2,200 experts on board specializing in modern and niche technologies to power your product with smooth performance and rich functionality. Moreover, N-iX builds its processes following the agile approach in all its projects, promoting effective collaboration, adaptability, and continuous improvement.
Contact us to discuss how we can use our resources, expertise, and skills to help you effectively outsource software product development!
