Outsourcing Software Development

Software Development Outsourcing: The Essence

Outsourcing is one of the reliable ways for businesses to develop software at a lower cost and effort. Software outsourcing entails the following benefits and risks:

Reduced hiring efforts and costs.
Quick project start.
On-demand access to required resources.
Optimized managerial efforts.
Easy team scaling up and down.

Less control over the project.
The risk of communication gaps.
The risk of security breaches.

More info on pros and cons of software development outsourcing

Since 1989, ScienceSoft has been rendering end-to-end software development services for both non-IT and IT companies.

How to Set Up Software Development Outsourcing

The outsourcing process setup will take from several days to several months. It will depend on the chosen outsourcing model, the maturity of the vendor’s processes, your readiness for such kind of initiatives, and more.

Step 1. Decide whether to outsource

A software development outsourcing initiative should start with a feasibility analysis. It can include the following steps:

Determining the stumbling blocks in your existing software development process.
Deciding on a part(s) of your software development project to outsource.

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Software maintenance and testing are usually the easiest project parts to outsource, while software requirements gathering and design are the most difficult to outsource.
When outsourcing software coding, make sure software can be safely divided into independent modules.

Comparing Total Cost of Ownership (TCO) of in-house vs. outsourced software development.
Selecting the fitting model of software outsourcing services:

Team augmentation

A vendor provides you with remote professionals for you to manage directly. You can get an exact number of experts you need, from 0.5 FTE to 100+ FTE.

Dedicated team

A vendor offers a dedicated team to work on an outsourced project or a part of the project, sharing risks and responsibility for the quality with you and/or your other vendors. Team management mostly stays on the vendor’s side: their Team Lead/PM reports regularly to your PM on the work progress.

Full process outsourcing

A vendor takes over the whole development process, with full responsibility for team organization and management, quality of the development results and accompanying risks.

Step 2. Select the software outsourcing company

When shortlisting potential vendors, consider the following factors:

Experience in outsourcing software development services shared by a vendor on their website, in case studies, etc.
Vendor collaboration experience shared by third parties in testimonials, reviews from independent research agencies, etc.
Location (onshore, nearshore, offshore), time zone differences.
Language and cultural proximity.
A vendor’s development infrastructure (hardware, network, bandwidth, etc.).
The maturity of project management, quality management, and security management processes (e.g., proved by ISO 9001 and ISO 27001 certificates).
Compliance with industry standards and regulations you need to follow (HIPAA, FDA, PCI DSS, etc.).
Pricing options offered (fixed price, T&M).
Software maintenance and support options available.

Note

Vendors offer a variety of support models, for example, free/paid post-implementation software maintenance for a certain period, free/paid post-implementation software maintenance and free/paid post-implementation support (L1, L2, L3, L4 support in different combinations) for a certain period, free post-implementation software maintenance and support and paid software support and evolution for the required period, etc.

Step 3. Set up the outsourcing process

Send a request to the pre-selected vendor with the detailed skill set and FTE required.
Get CVs and rates of available staff.
Schedule interviews with potential hires.
(optionally) Arrange a test task for the potential outsourced experts.
Negotiate SLA, including penalties for security breaches.
Sign the contract.
Organize the knowledge transfer to outsourced resources.
Provide remote resources with access to the project infrastructure.
Negotiate communication channels between the outsourced staff and the rest of the project team.
Schedule to get weekly and/or monthly performance evaluation reports.

Send a request to the pre-selected vendor and get the proposal with service options, development approaches, etc.
Receive the vendor’s estimation of the project scope and exact efforts to implement it.
Together with the vendor decide on KPIs to track the performance of the outsourced team.
Negotiate SLA, including penalties for security breaches.
Sign the contract.
Organize the knowledge transfer to the outsourced team.
Provide access to the project infrastructure to the remote team.
Decide on the convenient communication channels with the outsourced team.
Schedule to get weekly and/or monthly performance evaluation reports.

Send a request to the pre-selected vendor.
Receive the proposal with basic estimates for a technical solution the vendor suggests (optionally), service options, development approaches, etc.
Get from the vendor:
- Analysis of all software development and support needs (based on application backlogs, business plans, input from IT departments and business departments), evaluation of the project scope.
- Analysis of your current development and testing processes (if any).
- A service delivery plan.
Negotiate SLA (it can include such KPIs as budget planned vs. budget spent, user satisfaction metrics, backlog waiting time expired, application reliability and security metrics).
Sign the contract.
Organize knowledge transfer to the vendor.
Check your vendor to set up the development process, implement CI/CD (if needed), integrate with development and deployment processes of other vendors (if needed).

Specifics of Software Development Outsourcing Models

Staff augmentation

Easy resource scaling up and down to adapt to changing project needs.
Quick access to specific skills.
Direct supervision over the development process and team productivity.
1–2 weeks for onboarding (if the required resources are readily available in the vendor’s pool).

Full responsibility for project-related risks is on your side.
Onboarding and managing efforts are on your side.
High risk of communication gaps and collaboration difficulties.

Dedicated team

1–2 days to start (if the team is pre-assembled by a vendor and the team structure just needs to be reasonably adjusted to your project needs).
A vendor provides a Team Lead/PM to coordinate the work of the outsourced team so that they need little/no guidance from your side.

Risks related to vendor selection.
Project team coordination and project risk management can be still partially on your side.
In a newly gathered team, people may underperform during the first 2-4 weeks until the group turns into a real team.

Full process outsourcing

Minimum management efforts on your side.
Guaranteed quality of project deliverables and timeline alignment (with penalties for breaching them).
Access to a vendor’s established development processes.
Tackling project-related risks is on a vendor’s side.

The longest setup (up to a month).
High vendor risks.

Learn more about specifics of outsourcing models

ScienceSoft’s Software Development Outsourcing Offering

With 34-year background in IT and 750+ IT experts, ScienceSoft provides flexible software development outsourcing services for businesses to deliver software solutions cost-effectively and fast.

Staff augmentation

Developers, architects, testers and test automation engineers, DevOps engineers, system and integration architects, data architects, data scientists, support engineers, etc.
Flexible cooperation terms: 1 month – 10 years.
The exact number of qualified professionals you need (from 0.5 FTE to 150+ FTE).

I need this!

Dedicated teams

Fast ramp-up of the outsourced team (2 workdays – 2 weeks).
Experienced PMs and Team Leads to manage distributed teams.
Full assistance in establishing a collaboration environment and project progress control.
Strict compliance with agreed quality KPIs.
Easy team scale up or down.

I need this!

Full process outsourcing

Full-scale Project Management Office.
Defining the business and software development goals you want to achieve and taking the overall responsibility for the ‘how-to’ part.
Tailored communication with each stakeholder.
Continuous granular monitoring of project progress, regular reporting.

I need this!

Why Outsource Software Development to ScienceSoft?

Since 1989 in IT.
750+ IT professionals.
7–20 years is average experience of our PMs, BAs, solution architects, developers, data analysts, and other IT professionals.
Over 3,600 success stories.
More than 30 industries covered.
End-to-end software development – we envision, plan, design, develop, integrate, deploy, and support software solutions.
In-house project management office (PMO) – our PMs are experienced in large complex projects with distributed teams and multiple vendors involved.
Services built around strict agreed KPIs – business outcomes, quality of delivered software, code quality, development process efficiency, project time and costs (actual costs vs budget, budget to completion vs budget remaining, etc.), team’s productivity, and customer/user satisfaction.

Benefits of Software Development with ScienceSoft

All required skills onboard

ScienceSoft offers access to over 750 IT experts, including PMs, business analysts (BA), developers, architects, testers and test automation engineers, DevOps engineers, system and integration architects, data architects, data scientists, support engineers, etc.

Flexible cooperation

Our projects last from 1 month – 10 years. Our teams can include the exact number of qualified professionals you need (from 0.5 FTE to 150+ FTE) and can be easily scales up and down on demand.

1.5–2x faster development

due to high proficiency and use of best coding and time management practices by our developers.

20–50% project cost reduction

due to the agile approach, CI/CD, and reuse of readily available components and more.

Industry expertise

Our industry-focused consultants (manufacturing, retail, healthcare, logistics, professional services, telecommunications, and 24 more) to help bridge business and technology in the most efficient way.

ScienceSoft's Success Stories

Viber App Development Outsourcing

ScienceSoft designed and developed an instant messaging and VoIP app for an ambitious startup.

Over 900 mln users.
5+ years of cooperation
30+ developers.

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Outsourcing of Web-based Software Development for Aviation Insurance

Modernization of a 20-year-old legacy aviation insurance web application, replacing outdated non-maintainable technologies with moderns ones and optimizing its functionality.
4+ years of cooperation.

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Software Products for Life Science Companies

Development, testing and support services for a provider of biotechnology, drug discovery and chemical research services.
Over 10 years of cooperation.
A scalable team of 8-29 ScienceSoft’s specialists.

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Development of an Azure-Based Software Product for VCIO Services Management

ScienceSoft built a cloud-native, microservices-based SaaS vCIO product and consistently delivered new features and updates to ensure a superior user experience for SaaS users.
1 project manager, 1 business analyst, .NET developers and architects, test automation engineers, DevOps engineers.

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Software Development and Support Outsourcing for an International Marketing Agency

ScienceSoft developed software that helps coordinate the Customer’s regional offices in more than 60 countries to improve loyalty and marketing campaign management. After the release, our team continued evolving software and provided 3-level user support.

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Software Development Outsourcing for IBM/Consul

ScienceSoft was an outsourcing partner of IBM/Consul for the development of security audit software for enterprises and introduced a number of process improvements to speed up the project and reduce development efforts.

Check the project

Software Development Outsourcing: Typical Roles on Your and Our Sides

	Staff augmentation (usually software engineers)	Dedicated team	Full process outsourcing
On the vendor’s side	One/several developers.	Developers. DevOps engineers. Team Lead/Project manager.	Project manager. BA. UX designers. UI designers. Developers with a Team Lead. Testers. DevOps engineers. Support engineers.
On your side	Project manager. BA. UX designers. UI designers. Developers with a Team Lead. Testers. DevOps engineers. Support engineers.	Project manager (for the vendor’s PM/Team Lead to report to). Developers (optional). DevOps engineers (optional). Support engineers.	IT manager.
Shared or on both sides		BA. UX designers. UI designers. Testers.

Software Development Outsourcing Costs

The software development outsourcing cost is defined by the following factors:

	The hourly rate for outsourced resources. The price varies greatly depending on the outsourcing region.
	The performance of an outsourced team.
	The transition to another outsourcing vendor (it is quite costly).

Specific cost factors for full process outsourcing:

The maturity of the vendor’s outsourcing processes (mature project management and well-established development processes help avoid rework).
The vendor’s QA process specifics (proactive testing lowers QA costs while fixing bugs in production makes QA more expensive).

Have a Complex Development Project with a Tight Deadline?

ScienceSoft can help deliver it on time and of top quality.

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About ScienceSoft

ScienceSoft is a global IT consulting and software development company headquartered in McKinney, TX, with offices in the EU and the Gulf. Since 1989, ScienceSoft has been rendering end-to-end software development services for both non-IT and IT companies. We have 750+ IT experts on board, customers in > 70 countries and across > 30 industries. We set up smooth and efficient collaboration, offer ISO 9001 certified quality management, ISO 27001 certified information security management, and deliver software solutions compliant with HIPAA, GAMP, FDA, PCI DSS, SOC 3, GDPR, and more.

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