How do you prevent IT outsourcing risks and build a great software product?

The outsourcing of software development provides many benefits.

First, companies get access to a pool of IT talents while it may be challenging to find software experts with the required skills to build a great product, especially in a limited time frame.

outsourcing great software productSecond, organizations can extend their in-house teams with UI/UX designers, software engineers, testers, and business analysts to address technical issues. Third, by delegating tasks to a third-party IT service vendor, it is possible to reduce project costs by more than 60% while saving software system quality (for instance, UК developers charge £10-£78 per hour and developers from Eastern Europe with the same skills earn £18-£35).

However, customers often have some concerns regarding software development outsourcing. It is more difficult to control the process of creating a software product when an IT firm is located in another country. In addition, communication may be ineffective due to different time zones.

This article describes how to prevent risks associated with IT outsourcing. You will learn how to take advantage of applying this practice and build a great software product within your budget.

IT outsourcing risks and how to prevent them

1. Lack of control over software product development

By hiring an in-house software development team, an organization can easily control the process of creating a digital product. However, finding software experts is a time-consuming process that requires joint efforts of HR managers, technicians, and business owners. 

IT outsourcing allows for resolving these issues. But how do you control software development to monitor progress and make sure tasks are completed as scheduled?

For this purpose, you should partner with a trusted IT outsourcing company that prepares daily or weekly reports containing details about planned and performed activities, as well as deadlines. 

Before signing a contract with a software engineering firm, you should clarify whether it gives access to a time tracking system, so that you can always know the number of spent hours for every task and monitor progress.

Some IT service vendors offer their own solutions to ensure the visibility of operations. For instance, Arateg IT outsourcing company built AraIS—its own project management system—to provide clients with the most detailed reports, including information about task statuses, implementation roadmap, delivered functionality, and deadlines. In addition, the platform automatically generates a weekly report and sends it to the customer.

Read how Arateg achieves the transparency of a software development process.

2. Poor communication due to different time zones

Organizations are often concerned about having no communication with a team when hiring an agency located abroad. However, a possibility to discuss a software project throughout a day is crucial to timely resolve the necessary issues.

Many businesses prefer to outsource software development to Belarus due to its convenient location and time difference of 1-3 hours with European countries. American organizations also collaborate with Belarusian IT service vendors to access field-specific expertise and reduce costs. To set up effective communication, they agree on holding daily video or audio meetings. 

Learn why Belarus is a great destination for IT outsourcing.

3. It is impossible to estimate intermediate results

When a software development outsourcing company is located in another country, it may seem to be difficult to verify system quality at different stages. For instance, an organization may not employ in-house professionals to review code and test software. However, having this possibility is essential to receive a software solution that aligns with customer requirements.

To build a software product that meets the necessary standards, you should find a trustworthy and experienced IT service vendor that will assemble a team of designers, developers, quality assurance (QA) engineers, business analysts, and project managers tailored to your needs. 

Before signing a contract, you should agree with an IT firm that software experts will showcase intermediate results at each project stage. This is a common practice that allows clients to verify that everything is going according to plan. 

Following the Agile methodology, an IT company can deliver new functionality every 2-3 weeks and demonstrate it to the customer. Therefore, you can ensure conformance with expectations and provide meaningful feedback, so that specialists can make changes to the platform accordingly.

4. High probability for incompliance with deadlines

Some customers have concerns about incompliance with deadlines when hiring an IT outsourcing company, especially when they can’t provide a detailed specification or suppose that it can be modified throughout the project. As a result, an organization may need to implement changes to the system or add new features. 

In this case, you should partner with an IT service vendor that offers a Time and Material (T&M) payment model. Signing a T&M contract, you pay for the actual number of hours spent on creating a digital product.

The main advantage of T&M is that it allows clients to easily alter software requirements. Scope of work, budget, and project duration is still estimated by software experts but can be changed if needed. 

Cooperating according to a T&M contract, you participate in the process of building a software solution to validate the outcome of each stage and make suggestions. Therefore, the main objective of T&M is to deliver a platform that aligns with end-user expectations, not meet strict deadlines.

If you have a detailed software requirement document, it is reasonable to choose the Fixed Price pricing contract. Learn more about payment models and identify the best one for your project.

Additionally, you should consider customer feedback on trusted B2B review and rating platforms. For example, Clutch.co asks clients to estimate conformance with deadlines in reviews while manually verifying each testimonial.

5. A software development team doesn’t have English proficiency

It is much more difficult to ensure successful cooperation with a custom software engineering company when encountering language barriers. To prevent this issue, you should communicate with a potential software development partner before signing a contract. 

In order to estimate English proficiency, you can hold an online meeting, at which you outline business challenges and discuss project issues. You can also check out the company’s portfolio to see what countries an IT outsourcing provider works with.

6. No proper protection of intellectual property and data

Before hiring an IT outsourcing service provider, it is important to sign a non-disclosure agreement to protect intellectual property. If a software requirement specification contains sensitive data, for instance, know-how, we recommend that you ask a software engineering firm to sign an NDA prior to document sharing and project discussion. At Arateg, we engage lawyers to ensure proper assignment of rights and ensure data confidentiality. 

To safeguard sensitive data, you should partner with an IT outsourcing company that implements best security practices to prevent threats such as hacker attacks and malware. In our dedicated development center, we employ virtual private network connections, two-factor authentication, and data encryption. Furthermore, our software experts regularly hold security audits to timely detect vulnerabilities and assess risks.

7. Improper operation of a software product

Poor product quality is among the most common concerns of customers collaborating with software engineering firms. Software testing and quality assurance are key to ensuring the proper operation of a system. 

While testing is about detecting and fixing bugs, the main goal of QA is to prevent potential bottlenecks and deliver user-friendly software solutions that meet the necessary standards, for instance, security regulations. Therefore, you should hire a software development outsourcing company that has in-depth expertise in QA and testing.

8. Lack of project support and maintenance

It is more costly to resolve issues than prevent them. Ongoing project support after launch is crucial to instantly detect and eliminate errors, as well as ensure stable, uninterrupted performance. That is why you should choose a custom software engineering company that provides this service. 

If you plan to extend a software product after release, for example, to create a new version or make upgrades, you should partner with a software development center that offers maintenance after release. You can clear up these moments in the first inquiry.

Hiring a trusted IT outsourcing company

Collaboration with a trustworthy software development outsourcing company is key to building a quality software product. To hire a reliable partner, you should analyze its portfolio, learn specialization, explore accomplishments, and read customer testimonials. 

In most cases, you can find this information on the website of an IT service vendor. It is also important to check out profiles on B2B review and rating platforms such as Clutch.co, GoodFirms, App Futura, WADLINE, and DesignRush. 

In addition, you should take into account the level of team experience. To resolve complex challenges and improve time-to-market, you should hire an IT firm that employs more than 80% of middle and senior (not junior) designers and engineers.

If you have a project idea, drop Arateg a message. Software experts will get back to you within one business day and help you address all issues. The consultation is for free.