Why It’s NOT Crazy to Engage in Outsourced Product Development

By Admin
Posted on Tue, Mar 26, 2013 @ 3:21 pm

software-development-team-3-resized-600If you work at a software product company, you probably struggle with the idea of outsourcing development work on your product to a third-party vendor.  After all, why would you outsource your core competency?  You’ve become successful exactly because of your ability to develop great products yourself.  The truth is, you’re correct to think that way.  You shouldn’t outsource what you’re best at, as long as you don’t have any of the common resource challenges typically faced by growing product companies today.  If you can answer “no” to the questions below, then you should stick with the team you have and not bother with outsourcing.  However, if you’re like most product companies, you’ve probably found that these problems are not so easily avoided…

1.  Do you have difficulty finding people in your region who can do the work?

The U.S. only turns out about 11,000 computer science graduates a year from its universities according to the Computing Research Association.  That’s far too small a number to fill the US’s hiring demands in the software industry.  These few graduates are highly sought-after and can be difficult to secure at a growing business when big, flashy companies like Google and Apple are making them incredible offers.

2.  Do you have budget pressures that prevent you from paying the going rate for top talent?

Because software engineers and developers are in such limited supply in the US, they don’t come cheap.  Many growing software businesses can’t afford all the new hires they would need in order to get their product out the door in time.  This leads to either hiring more junior resources that don’t understand software product development or higher turnover as skilled resources jump to the next job for a big raise.

3.  Are you under tight deadlines and can’t add capacity fast enough?

Your business may be experiencing rapid growth and require a greater capacity to keep up with customer demands, but it takes time to find new, quality talent to hire.  Unfortunately, you don’t have that time when you’re under strict deadlines for developing new product.  Additionally, hiring full-time talent carries a burden of employment that is tough to unwind if the company’s development needs ebb and flow.

If any of these resource problems plagues you, then outsourcing some of your product development may be the way to go.  Outsourced Product Development (OPD) firms can quickly provide your business with the skilled talent you need at an affordable price, along with the ability to easily scale up or down depending on your needs.  Most outsourcing firms use Indian labor markets to mine the rich quantity of skilled technology resources.  India turns out an impressive 140,000 computer science/engineering grads a year according to the All India Council for Technical Education cited on Rediff.com, and the cost for this labor is extremely affordable.  You can instantly take on all the resources you need rather than having to find them on your own, and you can easily increase or decrease the number based on your demands in the future.

So what’s holding you back?  Despite all these problems that outsourcing can solve, many of you have probably tried it and had a bad experience at one time or another.  Outsourcing can be a real hassle.  Communication is so essential to building software that it’s best to keep your team close by in order to facilitate interaction.  However, sometimes you just don’t have that luxury, and you have to go a different route because of resource difficulties related to availability, budget, and time.

The good news, though, is that there are now companies like OFS who actually understand what product engineering is.  Rather than just turning to a body shop of developers who simply write code, you now have the option of turning to a company that can act as an extension of your product development team.  These outsourced product engineering companies understand what it means to build software that serves a whole market rather than internal IT software built for a singular purpose.  They have developed in-depth processes and controls to mitigate the communication challenges of offshoring because they understand how essential communication is to building quality product that is scalable, configurable, compelling, and multi-enabled.  These practices include:

    • Working shifted hours offshore to allow for an overlapping, collaborative work period every day with the onshore team
    • Putting a senior resource onsite to create a constant connection between onshore and offshore, with the resource working extra hours communicating offshore in the mornings and evenings to ensure all-around understanding of the project
    • Participating in daily stand-up calls and weekly project calls to further facilitate communication between your team and the offshore resources
    • Providing all emails and mobile phone numbers of team members onshore and offshore so they are able to reach out directly to each other
    • Working in 2-week Delivery Cycles so you can quickly see the progress being made and constantly review the work being done with the teams

Through these improved communication practices, outsourcing has evolved, and companies like OFS now make it as painless as possible to do outsourced development while leveraging their deep understanding of product engineering.  Of course it’s not as ideal as having all the work done by your employees onsite, but if you don’t have the budget and time to find that type of resource, you have to go another direction.  Choosing the right offshore partner with expertise in product engineering creates a faster and cheaper option for you to still get the job done well.


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