Software Outsourcing

Why outsourcing software development is a Smart Business Move

April 25, 2023
6 min

Software is an essential aspect of modern technology and continues to play a crucial role in shaping the future. The advancements in software development and artificial intelligence are driving innovation in many industries, including healthcare, finance, transportation, and more. A software can be described as a set of instructions that program a computer or any other electronic device what to do. It enables the hardware to perform specific tasks and functions, such as running an operating system, accessing the internet, editing documents, and playing games.

Due to the variability and almost seamless application of software, almost everyone in modern society uses it in some form. Software is used in a wide range of devices and systems that we interact with on a daily basis, such as smartphones, computers, televisions, cars, and appliances. However, the use of software is not limited to technical or IT-related fields, it is also used in many non-technical fields such as education, healthcare, finance, retail and more. 

As technology advances, software has become increasingly sophisticated and capable of performing more complex tasks. Artificial intelligence, machine learning, web development and data analytics are examples of cutting-edge software technologies that are changing the way we live and work. For example, AI is being used to improve medical diagnoses, automate manufacturing processes, and create more realistic virtual experiences.

Furthermore, the Internet of Things (IoT) has been growing drastically, connecting everyday devices with the internet and allowing the share of data as well as the automation of processes. This has led towards improving efficiency in various fields, such as agriculture, transportation and healthcare, and it will bring new revenue streams and business models. Overall, software is playing an increasingly important role in shaping the future of technology and society, and it will continue to drive innovation and economic growth in the years to come.

In-house development: A dead-end?

However, software development is also facing the challenge of not being able to meet the giant leaps and bounds of technological growth. Particularly, the IT sector is experiencing a shortage of skilled talent, where approximately 54% of companies report scarcities in IT staff due to recruitment bottlenecks and the lack of skilled specialists that understand the complexities of the technological demand. Thus, in-house software development has become a significant setback to many industries, presenting a number of challenges, including:

  1. limited resources in terms of budget, personnel, and equipment.
  2. lack of specialized skills or expertise required for certain advanced projects, which then necessitates more time to catch up with the best practices and latest technologies. 
  3. difficulties in scaling as the business grows.
  4. longer development time, which then causes delays in the launch of new products or features.
  5. limited flexibility in moving with the business needs, requiring the company to invest significantly to achieve a single solution.
  6. high maintenance costs due to the company’s accountability in managing all aspects of the software.

Outsourcing: The present and indeed the future

Outsourcing Software Development

Software outsourcing hence becomes a crucial solution to the aforementioned setbacks. Outsourcing software development is the process of hiring an external company or individual to handle the development of software products or specific software components. This can include tasks such as coding, testing, and maintenance. Across different tech sectors, app development currently ranks as the most frequently outsourced service, amounting to more than 60% of companies outsourcing the function partially or fully. IT security and network operations come in as a close second and third, where 55% and 27% of companies, respectively, outsource their software development. Development in blockchain technologies is relatively a new software, although one that is now being advanced more frequently, and increasingly via outsourcing partners. 

Companies may choose to outsource software development for a variety of benefits. 

  1. Outsourcing can be more cost-effective than building and maintaining an in-house development team.
  2. It allows companies to access specialized skills and expertise that may not be available within their organization.
  3. Outsourcing can lead to faster development times and more efficient use of resources with the employment of the most skilled engineers tackling its demands. 
  4. Companies achieve greater flexibility in operations, allowing them to easily adjust the size and scope of their development efforts in response to changing business needs.
  5. Providing an enhanced user experience, where the company can remain an industry leader while the outsourced specialists continue to find ways to satisfy clients’ needs.
  6. Outsourcing can make it easier to scale development efforts as the company grows.
  7. The use of an external team can help companies to reduce the risk of project failure by leveraging the expertise and experience of an experienced development team.
  8. Outsourcing to a different time zone can allow companies to take advantage of a 24/7 development cycle and faster software delivery.

However, outsourcing software development is not without its own share of challenges. Commonly outsourcing software development is met with communication barriers, cultural differences, a loss of control over the development process, issues in brand consistency, and considerable hurdles in the knowledge transfer process. 

Therefore, selecting the right team is crucial for your company’s success. 

What to look at when selecting an outsourcing software development company?

  • Communication: It is important to have clear and effective communication with optimal levels of transparency with the outsourcing team to ensure that project requirements and expectations are understood and met.
  • Quality and Experience: The outsourcing team should have a proven track record of delivering high-quality software on time and within budget as well as with experience in working on similar projects and for comparable industries. 
  • Cultural fit: Outsourcing to a team with a similar corporate culture that identifies with the business’s core values can help ensure smooth collaboration and understanding of project goals.
  • Legal and contract terms: Carefully review and understand the legal and contract terms of the outsourcing agreement to protect your company's interests and safeguard the business’ assets. 
  • Security and compliance: Be sure to consider the security of your data and intellectual property when outsourcing software development and ensure outsourcing companies follow regulations, and protocols and honour agreements.
  • Scalability: The outsourcing team should be able to scale their resources to match the needs and parameters of your project.
  • Time zone: Consider the time zone difference between your company and the outsourcing team to avoid any communication delays.
  • Cost: Compare costs between different outsourcing options and find the best balance between cost and quality.
  • Feedback: Have a system in place for getting regular feedback on the progress of the project and addressing any issues that arise.

This is why Fcode Labs is the ideal candidate as the outsourcing partner for your business organization. Reputed as one of the best software companies in Sri Lanka, we possess a proven track record spanning across more than four years in over seven countries. Our work with AI and machine learning, web development, blockchain technology, mobile application development enabled us to cater to diverse business needs such; as developing process automation software, language learning and education applications, clinical management systems and digital hospitality solutions, to name a few, that has enriched our portfolio, creating a perfect depiction of how we operate and how our work complements your company’s business goals. Our teams include agile, creative and visionary persons screened and handpicked to become the perfect fit for the project. So, with us at Fcode Labs handling and managing your systems and processes, we can help you achieve optimal levels of growth faster. 


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