Are you considering making use of software development outsourcing services? If the answer is “yes”, that makes you one of a multitude of companies around the world that are doing just that as we speak. But while your decision to use outsourcing is hardly unusual, your needs and circumstances as a company are as unique as they come. So, what kind of software outsourcing services should you choose? What are the different types of IT outsourcing services and why you should know them? Let’s take a look.
Chances are that at this very moment you are trying to find a software company that can turn your startup idea into powerful market-ready software. Or, you are a representative of a company that requires a specific type of software specialists (say, Java developers familiar with the Spring Framework) for a short period of time and is hesitant to search for full-time workers. As your needs change, so does the relationship between you and your software outsourcing provider. But different types of outsourcing services can also be based on the circumstances of the provider itself. The distance between the client and the provider is particularly notable.
We’ll shortly go over various types of software outsourcing services based on both distance and client-provider relationship. But before we do that, let’s answer a very basic question:
Why do you need to know the various types of software development outsourcing?
If you are yet to use software outsourcing services, you may be wondering why it is necessary to divide them into various types. After all, most of software companies will probably gladly accept your project regardless of its nature and try to act accordingly. Well, the word “try” is a key here. In reality, some software companies are only worthwhile for very specific tasks. Similarly, you may find out that certain aspects of a given type of software development outsourcing resonate really well with your business model. Choosing the right type of outsourcing and then finding the best outsourcing provider may become a crucial part of your long-term strategy as a company.
Sounds interesting? Let’s start with those based on distance.
Location-based types of software development outsourcing services
When you begin searching for the right outsourcing provider, you will find out you have essentially four different options:
|Poor||Very good||Very good|
|None||0-4 hours||4-16 hours|
|None||None to fair||May be significant|
Range of services
|Any service||Any service (with minor limitations)||Limited range of services|
Just how much time difference are we talking about?
The table below shows you just how many hours of difference there are between typical outsourcing destinations and countries that often use outsourcing services. As you can see, there is little to no time difference between countries such as Poland and other European countries such as Germany or UK. Multisourcing can be potentially used to hire developers from around the world and have your projects developed around the clock.
Time differences between popular outsourcing clients and providers by time and date
Client-provider relationship-based types of software development outsourcing services
When it comes to the types of outsourcing based on the relationship between the client and the provider, things get a bit complicated. There could be no end to their varieties if we attempted to list every possible scenario. Fundamentally though, three scenarios are particularly common:
Staff augmentation (body leasing) – is your company working on an ambitious software project and found itself in sudden need of some support? Chances are you may need experienced specialists – but only for a little while. Instead of hiring full-time workers, you may use staff augmentation. Your outsourcing provider essentially lends some of their developers. While technically they are not your employees, when it comes to the project at hand, they are de facto your employees for all intents and purposes. If your company’s demand for developers tends to change quickly, this may be a great way to save money.
Dedicated teams – staff augmentation is great and all… but what if your company doesn’t have much in the way of software development capability to begin with. If you don’t have a skilled project manager experienced in IT, you may not be able to make a good use of the developers you borrowed. In that case, you can need more than just single developer manpower. Level of responsibility may vary here from outsourcing only development functions to outsourcing whole delivery and management of the entire project to your partner. It has long been believed that if software development isn’t a core capability of your company, this type of outsourcing can be very useful.
Dedicated development center – if you consider resources in a specific country/area to be particularly valuable, you may decide to move some of your management to this place and tap directly into its labor potential. If you are not convinced you have the ability to easily operate in a market you don’t have any experience with, you may use the services of an outstaffing vendor. A company like this will hire the developers and then let you use their services for a fixed fee.
|Staff augmentation||Dedicated teams|
Dedicated development center
|Client-Vendor relationship||The client purchases developers and gives them instructions||The entire project is overseen by the outsourcing provider||The client hires developers in a different country|
|What’s client in it for?||Individual skilled specialists needed to complete the project||Full range of functions e.g. development and management of the project||Skilled specialists and favorable market conditions|
|Risky when…||You don’t have proper managing capability in-house||You outsource your core competency||You don’t know much about your target market|
|Best suited for…||Software companies in need of new developers to accomplish a specific task, usually on a short term basis||Companies with limited IT capabilities that want a software house to take over development of one of their products or develop software for them from scratch||Large companies with strong management capability|
There is more to it…
There is even more to the topic of software development outsourcing types. In the next article, we’re going to analyze the most common pricing models for outsourcing services.
Software Mind is a Polish software house that aims to provide software development outsourcing services that have the very best value for money. Located in Kraków, often referred to as the Polish Silicon Valley, it has long been polishing its outsourcing prowess, completing projects for clients from around the world. Tell us all about your projects. We will find the most efficient way to turn it into reality. That’s just what we do.