More and more businesses nowadays are turning to outsource their software development to stay ahead of the competition. Companies can see that by outsourcing, they can yield more benefits than ever. Such as:

  • They can get the topmost talent and expertise in the field
  • The execution and innovation is much faster
  • The agencies they outsource have the ability, are smarter and know to get the most use of all their resources.

When done correctly, outsourcing is the best way forward for any business. Whether it be a sustainable business plan, innovation, or rapid releases, this article aims at showcasing and comparing the different types of outsourcing models so you can see which one works best for you and your company. 

Any kind of outsourcing model is a specific and predefined approach. For the entire project, it provides customization. For example, not everyone would require a new application for their project. Some might only be needing it for their routine maintenance. Following are the different kinds of  software outsourcing business models:

  1. Project-Based Model- This is the most suitable and popular model when you know the exact specification of the type of job. Or instead when you are clear in your mind with the requirements of the job. Here the outsourced team would do the complete development of the project. In this type of outsourcing model, the outsourcing team takes care of the entire plan and its tasks. There are two scenarios in which companies go for this type of model. First, when their internal team is not enough to take the development project on. Second, when they do not want to have an in-house team full-time for this task. When entering into this agreement with the outsourcing agency, all requirements are to be pre-defined.
  1. Dedicated Team Model- This outsourcing model can be adopted when you need only oversight for the project. This outsource model would be the smarter and better choice when you only need input. The providers also take care of the process quality, people management, and other low-level management tasks in the dedicated team model. Think of it as a team of engineers working on a pipeline project. The outsourcing agency is also responsible for the firing/hiring decisions and making sure that the plan is followed. 
  1. Staff Augmented- In this type of model, you get workers from the outsource agency to help with your internal software development projects. Here, most of the responsibility lies with the clients, and you would own the project from start to finish. This is also the simplest form of software development. The responsibilities of controlling the work process and managing the projects remain on the client’s side. 

Comparision and How to Choose the Best  Outsourcing Models for You

Listed below are a few points to keep in mind while choosing a software outsourcing business model. See which one fits best for your business.

When to choose Project-Based Model

  • If you are a startup, if you are a startup and not that tech-savvy, this model would work best. You will have no problem getting your hands on a custom software product as the agency would take care of it all. The outsourcing developers team will provide you with everyone required for the project, whether a designer, business analyst, or developer.
  • You do not have many resources- If you have pretty limited engineers in-house, it would be wise to opt for this model.
  • You have an in-house team, but they are busy working on the core product- Without the burden of the management part, you can outsource the development part.
  • The vision for your product is clear- This vision does not have to include all the required documentation even if you have the tech requirements such as languages and other features clear.

When to Choose Dedicated Team Model

  • You have acquired a project manager – This includes a CTO, or even a CEO and other tech leads. The main point here is that you have relevant domain experience in-house for the project.
  • If you wish to be involved in the decision-making- You would be part of the decision making the process more with a dedicated team model of outsourcing. This would mean involvement in the development process, such as the functionality, features, and other prioritization. But this does not include managing the team daily.
  • You need tech expertise in only some specific areas- If you have a need only specific tech gaps in your project. For example, you are working on the web development of your site but need help with the mobile app development side of the project.

When to Choose Staff Augmentation Model

  • Your in-house team does not have the required expertise- This application outsourcing model is perfect for businesses that do not have specific expertise, such as DevOps, Android development, or automated quality assurance. Here you would already have an in-house team but need a specialist to expand it temporarily.
  • You have a tech lead in your company- If you choose this model, that would mean that you take care of the management of the project. You need a boss or head of the department in place with tech knowledge and experience. For example, a CTO with domain knowledge.

Nowadays, software services have become an integral part of the business. The limitations that one might have had to outsource your software development cross-country do not exist anymore due to the advancement in technology.

Along with choosing from various software development companies, you also have to determine which type of model to adopt. Each of these models has its pros and cons. You just need to find one that works best for you to maximize your profits. Look into your business plan and strategy and see which one would fit best for your company.