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Outsourcing Software Development? 8 Tips to Ensure Success

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Software engineers are in high demand and local talent pools are contracting. Outsourcing software development is a great way for startups as well as established companies to accomplish IT goals when facing staff shortages. However, before you sign on the dotted line – consider the points listed below to ensure that you are hiring a firm that is the right match for your project.

Once you hire a firm, make sure you understand how the process will work, so that expectations are met, and the end results are successful for both you and the software consultants.

This blog post will detail the steps you should take when considering outsourcing software development.

#1: Choosing an Individual Contractor versus a Team

Many companies, particularly startups, gravitate to the idea of hiring one person to do all their work. They are looking for a Superman to come in and develop software, design and set up databases for scalability, test everything and be able to support the application. There are super-human developers out in the world who can do that, however they are rare. And your development is put on hold if they go on vacation.

A team of developers consists of specially trained individuals who possess the different skills needed to perform full stack, scalable development. Firms which provide developer teams have staffing resources to back up vacation downtime and to provide specialty knowledge which might fall beyond the scope of the project. Although you pay for a team, you have access to company-wide talent and skills.

When you should use individual contractors? When developing prototypes or to fulfill a need for specialty skills.

#2: Consider More Than Just Cost

When it comes to selecting an outsourcing partner, many people often make the mistake of basing their decision purely on cost. It is important to remember that you get what you pay for.

Cost is an important factor in decision making, but it should never be considered as the only factor. You should also take into account a firm’s track record, experience, technical expertise, and how well the outsourced team can meet your needs. You need to find reputable software consultants who have proven expertise in developing software related to the project work you are looking to complete. Cutting costs can mean poor quality work or subpar service. Additionally, if the project goes over budget or takes longer than expected, you may end up paying more eventually.

It’s a good idea to seek a long-term collaboration when hiring an outsourcing firm for any software development project. With long-term relationships, a true collaborative partnership has time to develop between the client and the software firm. The development team understands the client’s business and how they work, which allows for better targeted business solutions. Furthermore, a dedicated long-term support team can adjust to a client’s changing needs and be available for quick turn arounds.

#3: Perform Due Diligence when Choosing a Firm

Software development is a complicated process with many moving parts and associated risks. Too often, companies want to get something done quickly and therefore compromise the selection process of choosing the right partner. Be diligent in your selection process and perform a thorough analysis.

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How to Perform Due Diligence:
Research Front Facing Content

As with any product you buy, research pays off.

  • Check out a firm’s website. Does their site show you the work they have done? Or is it buzzwords and lots of text talking about what they can do
  • Is the completed work done for clients in industries similar to yours?
  • Read customer reviews
  • Do they display any certifications or partnerships with other software vendors? Can you find this company on the vendor partner portal?
First Contact
  • Ask for demos of related project work
  • Find out about development methodologies and processes for project management and quality assurance
  • What types of security protocols do they have in place?
  • Ask for customer referrals
Offshore and Sub-Contracting

Many consulting firms are also having a hard time finding software developers. So, it is important to know if they employ offshore talent or contract others to get the work done. If you are engaging an Offshore partner, it is important to know:

  • Are there any communication barriers in working with their offshore developers? How proficient are they in your native language?
  • Do they have well-defined communication methods i.e. video calls, status meetings, project management tools, etc.?
  • Can their team be available to speak to and support you during your business hours?
  • Can they work effectively with your in-house team?

The answers to the above questions give you a better idea of the firm’s profile and if they can meet all your expectations. This exercise helps avoid surprises when it comes time to start working together.

#4: Define Clear Project Goals

When outsourcing your software project, it’s important to be clear about what end goals you want to achieve – such as a product (MVP, POC), an update, an integration, etc. Project costing cannot be accurately estimated if end goals are not well defined. This leads to scope creep, which is always a costly endeavor. To make the project successful, both parties should have a solid understanding of what the end goal is and a general plan for how they are going to get there.

Derive a project definition document describing the vision and scope of the project. The project specifications should include a detailed scope of work comprised of the project’s main goals, where the data resides, who will use or need access to the software and the specific outputs needed. It should also include information on preferred programming languages (if needed) and development methodologies.

Having detailed specifications ensures both teams have a complete understanding of the expected results from the very beginning. Well thought out and defined specifications translate into more reliable project cost and time estimations.

#5: Scrutinize the Cost Proposal & Contract

As with any contract, make sure you understand what you are getting. There are certain deliverables that should be present in any outsourcing contract. Look for the following subject areas:
Development related:

There should be a section of the contract dedicated to describing the development team, methodology and general plan for the project. Look for:

  • The size and composition of the development team including team roles and responsibilities
  • A general process plan with a stated development methodology
  • Well-defined deliverables and milestones
What happens at the end of the project?

Once the project work has been completed, the firm should address the following areas to ensure a smooth turnover.

  • Knowledge Transfer – The firm should have a plan to transfer all application knowledge to the customer in some form, either documentation or training. The timeframe for knowledge transfer should be stated within the scope of the project.
  • Source code – Make sure it is clear who owns the source code at the end of the contract and the timeframe/method in which the source code will be delivered.
  • Support – Once the source code and knowledge transfer are complete, will the outsourcing firm still support the software? Or will the client IT team assume support of the product?
  • Warranty – Even software contracts contain warranties. A warranty will guarantee that if bugs are found within a certain timeframe (i.e. up to 90 days) after the project is in production, the firm will assess the bug and determine if it falls within the scope of the project. Some bugs may be deemed change requests, but in scope, bugs should be fixed if the error occurs within the warranty period.

Billing schedules should be clearly spelled out so there are no surprises in the invoicing process.

  • Will invoices be based on milestone completions?
  • When is the final bill/payment expected?

#6: Realize That You Need to Dedicate Resources Too

two people looking at chart on computer

Project Kickoff time is exciting – you are finally moving forward in your plan to ensure company progress through new or updated software. Your software team is confirmed, and you will have dedicated work being accomplished every day. However, just because someone else has been hired to do the day-to-day work, your dedicated time is still crucial to the project. Why?

The outsourcing team still needs one or multiple client team members to provide dedicated time for questions, issue escalations/resolution (such as technical access), and testing. If questions or issues cannot be resolved in a timely manner, then the project timeline is affected.

Many projects are derailed because client team members cannot afford to dedicate time to project schedules. A successful project needs dedicated time from both the outsourcing team and the client team. The required team members are determined by project size and scope, but both sides of the equation must be present to ensure a continuous path forward.

#7: Establish a Clear Project Plan with Tracking and Communication Protocols

All teams work more effectively when expectations are clearly communicated. Outlining clear communication protocols in addition to creating a defined plan of action lets everyone know the work to be accomplished within expected timeframes.

Once the outsourcing firm has a clear understanding of project requirements, they should outlay a detailed project plan broken down by deliverable milestones and specific project tasks. This plan should include task assignments for client resources as well as the firm’s resources. In addition to the project plan, the firm should outline methods for project tracking and communication protocols.


Establish which protocol will be used for each type of communication – conference calls, project platforms and email lists

  • Document the primary/secondary contacts for the project, technical and billing questions and the preferred method of communication for those contacts – especially who will be responsible for issue escalation.
  • Determine which platforms will be used for project planning and bug reporting. Make sure all necessary people have access to these platforms
  • Schedule status meetings and document who will run those meetings
Set up Project Plan and Tracking

Use regular status meetings to discuss open items, and communicate task completion percentages and project timeline status. This meeting should also be used to raise and discuss any blockers that have arisen.

  • Review the plan to ensure that milestones and completion dates are in line with GTM plans. Milestones should include screen mockups and demos if possible, to best communicate functionality.
  • Establish a process to address change requests and an appropriate approval process
  • Review and train users on the bug tracking process to achieve effective reporting and resolution

Establishing clear communication channels both before and during the project properly sets the transition for a balanced project cycle.

#8: Quality Assurance Testing (QAT) is Worth the Investment

Never skimp on testing. Did you know that fixing software bugs after deployment can be 4-5 times more costly than fixing it in development?

Many clients think they are saving money and time during the development life cycle by cutting back on testing. However, deploying software before it’s been thoroughly tested can affect your business operations and your reputation, which is truly costly. Applications are an extension of your brand. Bad user experiences cause customers to lose trust in your applications.

What does it mean for you to engage in Quality Assurance Testing?

  • You need to dedicate Subject Matter Experts to test the software, to ensure that the expected results are the actual results. This means making sure that time is scheduled to dedicate staff time for working with the developers
  • Test for functionality and performance. The outsourcing firm should be able to use stress testing methods which test the applications for increases in the number of users and data. You want everyone that uses your application to be successful, whether it’s 50 or 5000 users.
    QAT includes
  • Regression Testing. Your outsourcing firm can use automated test scripts which mean full functional testing can be easily undertaken with all maintenance changes.

Quality assurance testing means that you catch bugs before your application is deployed or published. A quality product means happier customers who return for more business.


Outsourcing software development comes with many advantages and choosing the right partner can be a great way to save time and significantly reduce costs. However, it’s important to say that even after you have begun working with your development partner, you should continue to evaluate the relationship to ensure that expected goals and results are still favorable. Check their expertise level, ask about the approaches, project plan, ability for you to be a part of project, etc. All companies work differently, and you need to make sure the partnership is still working for you. To realize success for everyone it is vital that both teams do their part. With careful management, you can foster a partnership that will take your business to new heights.

I hope this article helps you realize the key areas to consider when choosing an outsourcing partner. If you have any questions, please contact us today for more information or a free consultation. We look forward to hearing from you!

About SphereGen

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SphereGen is a unique solutions provider that specializes in cloud-based applications, Intelligent Automation, and Extended Reality (AR/VR/MR). We offer full-stack custom application development to help customers employ innovative technology to solve business problems.

Learn more about what we do in Application Development: https://www.spheregen.com/application-development

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