Developing a custom software application can be a major undertaking for any business. While many companies have in-house development teams, outsourcing the building of new applications is becoming an increasingly popular option. There are many potential benefits to outsourcing custom application development, but also risks to consider.
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Why Outsource Application Development?
Businesses may decide to use custom app development services for the following reasons:
Cost Savings
The most common driver is potential cost savings. Paying an outsourced team, particularly overseas, can cost significantly less than hiring in-house developers. Outsourced teams allow you to avoid expenses like payroll taxes, health insurance, paid time off, training, etc.
Focus Internal Resources on Core Business
Outsourcing custom development allows your internal team to focus on tasks more central to your business. App building requires specialized skills – outsourcing lets your team stick to their strengths.
Access Specialized Expertise
Even large enterprises can struggle to find developers with skills in complex or new technologies. Outsourced partners focus specifically on application development.
Scalability and Flexibility
It’s easier to scale an outsourced team up or down as needs change. Adding in-house staff has more long-term commitment and financial risk.
24/7 Development Cycles
Distributed outsourced teams can work around the clock to expedite the delivery of projects on tight deadlines.
Potential Risks of Outsourcing Development
While cost-effective, handling outsourced software product development does come with some downside risks, including:
Loss of Control
You have less direct control over an outsourced team and must clearly document requirements and specifications. Clear communication is key.
Security & Compliance Risks
Apps deal with sensitive data. Vetting providers on information security is crucial, as failing to do so can risk data breaches.
Quality Issues
Low-quality providers can deliver poor code that doesn’t function properly, damaging the user experience with your application.
Time Zone Coordination Challenges
If using an offshore team, differing time zones can make collaboration and communication more difficult.
Key Application Development Outsourcing Models
If you decide outsourcing custom development is right for your project, there are three primary outsourcing models to consider:
1. Staff Augmentation
Staff augmentation involves temporarily expanding your in-house development team by contracting external specialists. You manage the outsourced staff like regular employees, giving you maximum oversight for sensitive projects.
2. Project Outsourcing
Here, you outsource specific projects or clearly defined scopes of work. Requirements are documented formally upfront. The external team handles all aspects of development through delivery.
3. Managed Services
A managed service model is where you contract custom application development and management to an external provider as an ongoing service. This approach requires the least effort to manage.
How to Choose an Outsourced Development Provider
The key to a successful application development outsourcing engagement is carefully vetting and selecting the right partner. When evaluating providers, consider factors like:
Technical Expertise
Review the technologies they have experience building with and projects delivered in your problem space. Top talent is essential.
Communication and Collaboration
Assess English proficiency and transparency of operations. Can they clearly articulate status and issues? This simplifies oversight.
Quality and Security Processes
The SDLC, testing, and security should all be mature and well-developed. Inquire about code reviews, automated testing, compliance audits, and more.
Retention of Employees & Staff Turnover Ratio
Staff stability is good for product quality and keeping knowledge within the company. High-turnover teams often create learning cycles that need to be started repeatedly.
Cost Structure
Ensure that the costs, efforts, and time are in harmony. Very low-cost teams are usually a disappointment, or they lure the audience and then change tactics.
References and Reviews
Do not rely on what marketing departments write. Interview previous clients about their outsourcing experience and the quality they received from the outsourcing firms.
Key Custom Application Development Methodologies
Beyond selecting the right partner, clearly defining the software methodology for your custom development project also ensures optimal outcomes. Below, we explore some of the most common approaches:
Waterfall Development
The waterfall methodology is very linear and structured, progressing through clearly defined phases:
- Requirements: Comprehensively document all features and functions needed.
- Design: Translate requirements into technical specs and architecture.
- Implementation: Code applications and build databases based on design.
- Verification: Thoroughly test the application to ensure requirements are met.
- Maintenance: Ongoing support and improvements post-launch.
Waterfall emphasizes full planning upfront. It works best for projects with fixed scopes and unchanging needs. However, it lacks the flexibility to change direction.
Agile Development
In contrast to waterfall, agile methodologies take an iterative approach to building applications:
- User Stories: Capture core features and tasks as “stories”
- Sprints: Divide stories into development cycles of 1-4 weeks
- Prototype: Rapidly build a lightweight version of the application
- Evolution: Continuously refine and add features sprint by sprint
- Deployment: Release working product frequently for user feedback
Agile focuses on speed and collaboration. Developing in sprints allows for changing priorities. Frequent deliverables keep stakeholders engaged for steering.
Hybrid Approach
A hybrid waterfall/agile approach combines the best of both methodologies for many projects. Initial planning and design can progress in a structured waterfall manner, while development sprints build in agility for evolving priorities.
No matter the methodology, constant communication between in-house product owners and offshore development teams is imperative to success. Be sure to align closely on priorities, milestones, and iteration plans.
Key Custom Application Architecture Considerations
Beyond how you build apps, strategically designing the underlying connectivity and integration architecture is crucial for performance and scale.
Monolithic vs. Microservices Architecture
- Monoliths concentrate all application logic into a single executable. This simplifies development but hampers scaling.
- Microservices break processing into independent components. While more complex, this enables scaling specific functions.
- Evaluate tradeoffs to determine the best fit for long-term usage projections.
On-Premises vs. Cloud Hosting
- On-premise hosting relies on owning physical servers. With more control, hardware costs can be prohibitive.
- Cloud hosting leverages rented virtual resources, balancing control with scalability on demand.
- For most modern applications, a cloud or hybrid strategy makes sense in the long term.
API-First Design
- Properly designed APIs abstract complex services into reusable building blocks.
- Developing APIs first facilitates integration and future expansion.
- Outsourced teams should have API expertise for interconnectivity.
Architecture decisions have long-term impacts on application success. Investing in technical leadership for offshore partners pays dividends over time.
Conclusion
Outsourcing custom application development provides ways to supplement capabilities that make sense for many businesses. The keys lie in thoroughly vetting potential partners, clearly defining desired methodologies upfront, overseeing progress closely, and proactively mitigating downside risks.
