Best Practices for Software Outsourcing

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You may be wondering what outsourcing your software development will entail. According to Gartner, “IT outsourcing is the use of external service providers to effectively deliver IT-enabled business processes, application services, and infrastructure solutions for business outcomes.”

While you can do software development in-house, it’s often more practical to outsource the task to a company whose main infrastructure is built around software development. They’ll already have people who are trained in the skills necessary for software development, while you may have to train your team members and managers to become skilled in software development practices. Even if you have software development teams, your in-house team may not have the skills or bandwidth needed to execute a new kind of project. Outsourcing comes in very handy in such a situation.

The software industry is a big one, particularly when it comes to Software as a Service (SaaS). This model offers all software hosted in the cloud, which is then accessed by businesses and/or individuals who purchase access. The SaaS market is expected to grow at approximately $117 billion by the end of 2022, with a compound annual growth rate of approximately 21%.

Industry Trends

There are several software trends that are gaining momentum right now and are expected to become dominant in the future. These trends include artificial intelligence, progressive web apps, cybersecurity, blockchain development, and low-code development.

Artificial Intelligence (AI) is one of the most up and coming technologies and is expected to be at $3.9 trillion by 2022.

When people think of blockchain technology, they often think of Bitcoin, but the tech goes far beyond the cryptocurrency. Blockchain is defined as “a peer-to-peer network of interconnected computers for storing data or information which can’t be modified or stolen by anyone.” IBM has its own blockchain platform and Microsoft has been adding BaaS (Blockchain as a Service) modules to its Azure platform.

A progressive web app is an app that looks and acts like a traditional website. These types of apps are becoming more and more popular as people tend to use their mobile devices (phones and tablets) instead of laptops and desktops for accessing information.

Cybersecurity will continue to take precedence as companies are still reporting cybersecurity attacks occurring on their business. Protecting data loss is a high priority for most companies, followed closely by threats to data privacy and breaches of confidentiality.

Of course, the industry will grow and change beyond the trends discussed above, but those are the major software development areas to keep an eye on. By watching the trends and adjusting your methods to align with those trends, your company can continue to be successful, even as you’re outsourcing important software development projects. 

Low-code development is a form of software development that doesn’t require as much expertise in coding as traditional software development does. This form of development is expected to overtake traditional forms in the next few years as it’s easier and more cost-efficient.

Challenges of Developing Software in a New Era

When it comes to developing software in this new business era, companies and individuals will face myriad challenges. However, there are ways to overcome those challenges without totally losing your mind or your competitive edge. Here are five of the most common challenges in developing software. We also discuss how to overcome them so that your entire team doesn’t decide to throw in the towel at the eleventh hour.

Challenge #1: Competition is high, thanks to globalization

Even if you’ve thought of the greatest software idea ever and are sure that nobody else has developed it yet, there’s no telling how close another company is to developing that very same, or similar, software. Whether the competition is local or national, it can be far-reaching in its effects on pricing, structure, and much more. 

To overcome this challenge, your project manager will have to work closely with business managers, stakeholders, and others to ensure a project will be a success. This is easily done by ensuring you have protocols in place to protect your ideas and other proprietary content.

Challenge #2: Infrastructure Issues

Companies often invest high dollar amounts in maintaining the legacy systems they already have in place. Because of this, companies are often reluctant to replace their current systems with more updated software. 

This challenge can only be overcome when project managers are able to obtain buy-in from all stakeholders. This can be done by clearly conveying all the benefits of an upgrade to those stakeholders; from improved infrastructure to cost savings.

Challenge #3: Complicated User Level Requirements

Having multiple levels of users is almost a given when it comes to accessing software, especially during the development phases, but those requirements can quickly become complicated, causing difficulties for those using and/or developing the software. Some of these difficulties can include admin rights and usage rights, which can vary depending on what the software is being used for.

To overcome this particular challenge, it’s important to implement rules for using the various systems and software right from the start, depending on the level of the user. This way, a user with less access can’t mess up higher level functions. Nowhere is this more critical than with financial systems, where users need to adhere to the Generally Accepted Accounting Principles (GAAP) as set forth by the U.S. Securities and Exchange Commission (SEC).

Challenge #4: Attracting Top Talent

It can be difficult to find top talent when it comes to software development. Many of the top software developers have already been recruited by well-established, top companies, such as Microsoft, IBM, and Google. However, you’ve probably got some incredibly talented software developers under your roof already. They just need some training to get to where you want them to be. 

Engineers make learning new technologies their main priority. However, new technologies are often risky ventures and business owners are often hesitant to take those risks. Everyone wants their business to be successful, and sometimes that means taking a risk or two. It doesn’t mean you have to be reckless, but it does mean that you may have to step outside your comfort zone sometimes.

There is one way you can overcome this challenge without shaking things up too much: create a culture of innovation within your business. You could follow Facebook’s example, in this case, and push decision making down to the engineer level in order to help them feel like they have some autonomy and are working to drive development forward. Get your employees invested in the success of the business and they’ll be more likely to learn the skills they need to grow. When the benefits trickle down, people feel more invested in what they’re working on.


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