Software Development

With custom software development, CTO challenges turn into opportunities





Software Development


With custom software development, CTO challenges turn into opportunities

Published: 2022/01/20

7 min read

Time is a drug. Too much of it kills you.
Terry Pratchett

As the bridge between the technical and business sides of an organization, today’s Chief Technology Officer (CTO) understands all too well the dangers of ‘too much time’. Given the unrelenting pace of technological innovations, a modern CTO faces momentous challenges, exciting opportunities and hard choices. Read on to learn why CTOs are teaming up with software outsourcing partners to overcome their biggest challenges; ramping up software delivery, accessing top-notch expertise and speeding up release cycles.

A lack of talent is downing projects before they even get off the ground

Not having enough talent is the biggest challenge CTOs need to tackle, with Manpower Group reporting that for companies with over 250 employees, 67% admitted they were struggling to fill roles. Despite the increased interest in IT careers, the industry has a shortage of talent. In 2019 in the US alone, federal employment data revealed there were an estimated 918,000 unfilled IT jobs. Beyond hampering an organization’s ability to maintain production levels and meet customers’ expectations, a lack of talented engineers and developers is slowing the pace of innovation. Research from September 2021 revealed that executives see the talent shortage as the most significant adoption barrier to 64% of emerging technologies, compared with just 4% in 2020. Moreover, the unavailability of talent is regarded as the primary reason adoption across technology domains like compute infrastructure and platform services, network, security, digital workplace, IT automation as well as storage and database is not taken place. Yinuo Geng, research vice president at Gartner, explains that “[t]he ongoing push toward remote work and the acceleration of hiring plans in 2021 has exacerbated IT talent scarcity, especially for sourcing skills that enable cloud and edge, automation and continuous delivery.”

While part of the problem lies in not being able to find talent, the other part comes from the understandable need to keep down costs. As engineers gain experience and proficiency, they expect higher salaries to reflect this. Retaining staff who can easily find work and better compensation elsewhere ( as explained earlier) becomes increasingly difficult. A CTO’s need to ramp up quickly must be balanced with the desire to keep costs to a minimum, which helps explain why CTOs are searching for software engineering support elsewhere at a reasonable price.

Hiring and developing in-house talent can be time-consuming, costly, and a burden. Putting aside the effort and resources needed to attract and retain capable employees, the reality is your local talent pool has a finite number of qualified engineers. This means that to ramp up your capacity, you’ll need to look for a nearshore-like partner who can provide the teams of engineers you lack. Likewise, an external dedicated development team can ramp down if needed. The advantage is clear – custom software development teams deliver flexibility. The increased scalability that a software outsourcing partner provides also reduces the risk of damaging internal morale since it is easier to amend a contract with an external team than to let go of your own employees. The cost of attracting and retaining talent falls to an external software development partner (who is more efficient at this since it’s their bread and butter) so that a CTO can focus on core business issues.

Keeping up with technological innovations and digital disruption

The need for agility and intelligent solutions is paramount, which is why digital transformations (or digital accelerations) are playing such an outsized role in organizations’ strategies. Statista reports that by 2023, digitally transformed organizations are forecast to contribute to more than half of the global economy and by 2024 worldwide spending on digital transformations will reach 2.4 trillion USD. 

A Chief Technology Officer, beyond looking after an organization’s technological needs,  is usually in charge of research and development (R&D). Though serving in an executive capacity as a key customer relations representative, a CTO’s technical IT background enables the strategic planning and overseeing of infrastructure that drive innovation. This means using software engineering capabilities to ensure constant upgrading of products and services that deliver a high return-on-investment and drive revenue.

Global market intelligence firm IDC reports that direct digital transformation investments will grow at a compound annual growth rate (CAGR) of 16.5% from 2022 to 2024, up from 15.4% CAGR 2019-2024. COVID-19 has only increased the speed of digital transformations. McKinsey reports that, in response to the pandemic, 85% of companies have accelerates digitization strategies and 67% of companies have accelerated automation and artificial intelligence (AI) initiatives.

The adoption of automation and AI, in particular, has propelled a shift to remote work models. Recent findings show that 88% of organizations around the world made it mandatory, or encouraged their employees to work from home once COVID-10 was declared a pandemic. Initial concerns about productivity were dispelled, as 77% or remote employees say they’re more productive at home.

This confirms that remote software engineering teams can be just as effective as on-site teams. So while in the past collaboration from a far might have been difficult, a CTO should no longer consider it a challenge to outsource custom software development to an external team.

Given the numerous challenges to tackle, technology to pursue and strategies to implement, it’s no wonder CTOs are looking for software engineering help. This explains why a 2020 study shows that 89% of IT heads said they increasingly need to rely on advisors to help navigate new technologies, processes and methodologies.  

This is where a software house that delivers customized software development can help. Companies tend to become comfortable with technologies they have used before, and may not have the motivation, or ability, to learn new strategies. But by working with a custom software company, a company’s internal development team can be introduced to new tools and methods by their nearshore partners. So, CTOs benefit from the expertise that speeds up the software development life cycle and this knowledge is passed on to the in-house developers as well.

What should CTOs look for in a custom software development company?

The number of software outsourcing companies promising to solve all CTOs’ challenges is staggering, with new software houses entering the market all the time. To find the custom software development they need, CTOs should focus on two key aspects: cultural fit and time zone compatibility.

Company culture has never been more important in recruiting and retaining talent. Jobvite’s 2020 Job Seeker Nation Report shows that 81% of workers think company culture is important in their decision to apply for a job. Furthermore, Gallop analytics shows that by hiring high-talent managers and creating a culture that attracts top talent, companies can see a 33% increase in revenue. Of course, developing company culture is an investment, and one that may take considerable time to mature. Instead, seek the support of an external team tailor-made to fit your needs and scale with you.

Partnering with an external team that integrates well into your company culture delivers real-world benefits, from improved atmosphere, to higher employee satisfaction and lower stress levels. It also boosts engagement in the work being done, and this is significant, as research shows that having highly engaged employees can lead to a 202% increase in performance. Your company has worked hard to develop a distinct culture that embraces certain values, and your software partner should respect this identity and be able to demonstrate behavior that fits into it.

Is it possible to work with an external partner who feels like a part of your company? Yes, and that feeling of camaraderie is just one of the advantages. Teaming up with an external  software development team that shares your culture fosters trust and makes communication easier – which is key to everyone understanding the scope of the project, thus reducing the risks of scope creep and project delays. Of course, as regards communication, eliminating language barriers is essential. CTOs in the United States are no doubt aware of the challenges communication with nearshore (Latin American) and offshore (Asian) software houses, where a lack of English proficiency can lead to costly misunderstandings. If only one or two members of an external team can communicate in English, the ability to share crucial information is greatly diminished. Conversely, an external team composed of software engineers who can clearly communicate in their native tongue and English dramatically increases the chances of everyone contributing ideas and giving feedback.

Time zone difference is important, but with the proliferation of collaborative tools, and willingness to adjust work schedules to ensure overlapping shifts, this is becoming less of a problem. However, technology is less helpful in overcoming differences in conception of time. While having to adapt to changing circumstances is part and parcel of every software project, your external software development team must respect deadlines and work to your timelines. Key to ensuring seamless collaboration is the Project Manager (PM), who must be able to connect internal and external teams, technical and business sides and ensure smooth software delivery that meets deadlines and doesn’t run over budget. An effective PM  will make clients more comfortable and secure since they will know their remote teams are being managed properly. With 70% of digital transformations failing, a highly experienced, skilled and organized PM is invaluable. 

Leaving CTO challenges behind while staying ahead of the competition

CTO challenges are immense, with expectations of growth, revenue, efficiency and production all falling on their shoulders. Turning to a software provider that can deliver dedicated development teams that are autonomous, cross-functional and able to fit your company’s culture is a way to lessen a Chief Technology Officer’s stress levels.

A software development partner’s experience, ability to match a company’s culture, understanding of the business and technical expertise to achieve the desired goals are key factors CTOs should examine when selecting a software engineering partner. Meeting this criteria is why Silicon Valley CTOs are turning to Software Mind for the dedicated teams of engineers they need to ramp up software delivery. If you’re a CTO looking for talented engineering experts to extend your teams, get in touch using the contact form.

About the authorPiotr Jachimczak

General Manager

A seasoned manager with 20 years of international experience in the IT industry, Piotr has a master’s degree in IT and is an EMBA graduate. A career that began as a software engineer led to numerous different roles on the technical side of software product development, including QA specialist, BI specialist and business analyst. Noticing a chasm between the technology and business worlds, he switched his career to management to help bridge that gap. Since then, Piotr has worked as a scrum master, project manager, delivery manager, IT director and general manager.

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