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Outsourcing Software Development: Choosing the Right Provider
Categories: General, Web Development

by Olga Rekovskaya

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As we discussed in one of our previous articles about software development, there are times when outsourcing a particular project makes the most sense. After doing your initial project research, you may realize you do not possess the necessary skills for using available tools to achieve the result needed, the time demands are too great or perhaps it is much more cost efficient to use an outside provider to complete the development project.

Say, you cannot handle Facebook integration on your own. In this case you may want to hire Facebook API developers.

Whatever your reason or reasons are for outsourcing, it is still important to properly manage the project, select the right provider for the job and ensure all of the key elements are addressed. The right provider can make your life much easier and a poor provider can make life extremely difficult, so be sure to cover all the details upfront.

Outsourcing Software Development

When it comes to outsourcing software development projects, there are several key elements you will want to ensure are discussed and covered with your chosen provider. Making sure you and your developer are on the same page and have a clear set of expectations will set the stage for a successful collaboration.

Eight Key Elements When Outsourcing Software Development Projects

I. Ensure everything needed is included in the project estimate proposal

Important Components of the Development Process:

  • Analytics or Specification
  • Design
  • Layout
  • Architecture & Design
  • Program Code Development
  • Code Documenting
  • Software Test Results
  • Deployment of Code on the Customer's Server
  • Maintenance
  • Training

II. Reduce costs by creating technical specification

Creating comprehensive technical specifications for your project can significantly reduce costs over the long-term. Additionally, it helps the developer clearly understand exactly what is required and what is not required to be included with the final version of software that is developed.

Not only will technical specifications prevent the developer spending unnecessary time of adding features or functions not required, it also helps reduce errors. Several years ago, the National Institute of Standards and Technology published a report stating software errors cost the United States economy $59.5 billion each year. For an individual project, it is easy to imagine a little confusion or missing an important element in the development process could cause a project to run significantly over budget.

It is impossible to account for all errors, but making sure you have clear specifications from the beginning will avoid errors and avoid dollars spent on unnecessary developer efforts.

III. Make sure the provider documents the code

outsourcing software development III. Make sure the provider documents the code

Extreme clarity in understanding a developer's code is important when making adjustments or fixing errors later on down the road. Without a clear understanding of exactly what the original developer was thinking and how they were thinking it can result in confusion, wasted time in deciphering exactly what was already done and bugs.

Be sure to have the developer provide comprehensive and straightforward documentation that will give clear insight to others who may have to work with the code later. It should be much more than just a few notes here and there; it should be a full, detailed and lengthy explanation of their coding process.

IV. Make sure there are no intellectual property rights issues

Infringing on intellectual property rights can potentially be a very serious problem and extremely costly, especially in the realm software used or sold for commercial purposes. These situations can sometimes lead to civil or even criminal proceedings with severe penalties. Even in the best case scenarios resolved by complying with a notice and takedown notice, will mean you will no longer be able to use or sell the software you had developed.

If the element in the software causing the issue is intertwined with the core operation of the software, then you will be forced to stop your business operation entirely. Lost revenue, lost time and the cost to redevelop or fix the problem can add up to substantial figures in a hurry.

V. Test the product yourself

Have you ever heard the phrase, "trust but verify"? This is an absolute rule that must be followed when outsourcing development. There is nothing wrong with building trust in a developer over time, but it is essential to test and verify the results yourself.

Not only will this give you peace of mind and ensure the provider has completed the project properly, it will also give you an opportunity to test the software from a consumer's point of view. You may find something the developer missed, an honest mistake or simply a portion of the software that needs a little tweaking.

VI. Do not hesitate to stay involved in the development process

Staying involved in the development process is usually a good idea. It will give you an opportunity to have a better understanding of the step-by-step process, how things were done and also monitor the progress and time spent on the project.

There are several excellent project management systems, which lend themselves to software development projects.

JIRA Project Management

JIRA is specifically designed to help project managers stay in sync with the progress of projects and allows them to define and track sub-projects within the core project.

JIRA provides a flexible platform that is loaded with features, allowing all members of a project team to view, track and communicate about the same project using the same information. JIRA also offers an option for a free trial.

jira dashboard outsourcing software development

Photo Source

Redmine is an open source project management tool that is completely free to use. It is a good alternative to JIRA and the price is right, however, it is probably best suited for those with a little more technical knowledge.

Because it is free and open source, there is a large amount of support information on the web, but utilizing the information will be up to you.

If you are looking for a full featured project management system, it is worth a look.

redmine alterantive to jira open source project management tool

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Time Tracking Software

Combined with the project management software, time tracking systems represent a powerful tool for measuring your team's performance. In recent years, time-tracking systems have become rich in functionality allowing full integration with project management tools such as JIRA and Redmine, among others. Many time tracking apps even allow activity monitoring such as apps used, screenshots, mouse activity and keyboard activity with the ability to generate various reports, billing reports and invoice generation.

We are currently in the process of developing our own time tracking tool, one that we would be happy to use ourselves. You can read more about it here:

Below are two solid time tracking systems you may want to consider.

VII. Ask for training

Training should be provided with the final software product delivered by the developer. If you feel something more informal is sufficient, then perhaps a Skype call or web meeting will be enough. If the software is more complex, then you may want to ask for a user manual, video or detailed instructions to be provided at the time of final delivery.

VIII. Communication

Clear and consistent communication solves many issues and avoids many problems before they happen. Be sure to communicate with everyone involved in the development process often and do not be afraid to give reminders about key issues even if they have been discussed before.

Choosing the Right Developer

Verifying a providers' credibility

Local Software Developers

Dealing with a local provider does have some advantages, as it allows you face-to-face interaction and the ability to visit their physical office location. There are times you can get a gut feeling or sense about someone and their company in person that is difficult to do via email, Skype or other online communication sources.

Additionally, you may be able to find local clients they have done business with in the past, who can give you an opinion on the overall value of the provider's services and tell about the details of their own experience.

While dealing with a local provider does add an element of easy research, you still need to search the internet for comments, reviews and information about the provider's business. They may be local to you, but chances are they have done work nationally or even internationally, with some type of rating and feedback given on third-party websites.

Offshore Software Developers

There is no reason to shy away from using offshore developers, even for large projects. Utilizing offshore developers can result in finding excellent talent and provide significant cost savings. Additionally, if you spend a little time doing some research, any established developer will have a trail of experience and customer reviews in one form or another online.

Infographic on outsourcing software development and custom software development

Photo Source

The IAOP produces a report every year rating the top one hundred outsourcing providers. This report can be an excellent source for finding a service that will deliver excellent results, at a fair price and with minimum hassles. There are many possible sources of information on the web about a provider you are thinking about hiring.

Independent Research and Reviews:

Additional Sources of Information on Providers:

By the way, we are recognized as a top <u>California Web Design Agency</u> on DesignRush.

Many times providers will have profiles on the above freelance websites that give reviews and valuable information about a provider's past performance and quality of service. By the way, there was an interesting research comparing Elance freelancers in terms of nationalities, prices and scores.

Additionally, you can search social media websites such as Facebook, Google+ and LinkedIn to view their profiles, comments and posts. You may also be able to find information through specialized forums that relate directly or indirectly to an outsourcing provider's services.

More insights on how to find remote software development providers can be found here.


If done properly, outsourcing software development projects can be a dynamic tool that helps reduce costs, saves time and adds experience to your operation. If you commit to properly managing the process and ultimately find a few outsourcing providers you can trust, then you will be well on your way to fully taking advantage of outsourcing capabilities.

Have your experiences with outsourcing been good or bad?

We would love to hear about your experiences and advice for achieving the best results when outsourcing software development.

If you want to learn more on this topic, feel free to download our software development guide.