When we talk about IT outsourcing or development outsourcing, we talk about the externalisation of IT services to help clients reduce costs, accelerate time to market and take advantage of external expertise. You are basically looking for external resources for IT functions as for example software development, maintenance, support, etc. Usually when you outsource a service it’s because it ends up cheaper to contract an expert in that field than to build it in house. In this article I would like to do a sort of development outsourcing overview.
Reasons for development outsourcing
GO WITH EXPERTS
Sometimes, it’s just better to concentrate on what we do best and ask experts to do the rest. One of the main reasons why a company can outsource some services is because it doesn’t really have that expertise. That also means that you will spend less on training your employees to be able to get a task done and you will also gain time, therefore cutting costs.
KEEP FOCUS & INCREASE EFFICIENCY
When you add workload to your team, specially activities where you’re not the best at, you are just reducing your core quality, your primary activities. By relying on a third party, you focus on your core, on quality instead of quantity, meaning you perform better. By sharing workload, you will help your team develop their force and therefore become more efficient.
LOWER YOUR RISKS
By working with a third party, you are in a way sharing the risks, it’s not only on you, it on both parties.
HAPPY CUSTOMERS, HAPPY BUSINESS
By getting tasks done by others, specially by experts, you will almost always get results of high quality and faster then if you would complete the tasks. This in a way would mean that you will have faster time to market, of faster deliveries. Well that translates in high customer satisfaction. And which business wouldn’t benefit from happy customers?
THE CHEAPER THE BETTER
Until now, everything we talked about ends up in cost reduction. In fact, with development outsourcing, you save on money spent, on time, and all the work to train your employees and the efforts they put to learn. It doesn’t mean that you are not spending money when you outsource, it just means that on the long term, it can be much more interesting.
EVERYONE WANTS A COMPETITIVE ADVANTAGE
How are you being more competitive? It’s kind of logic. First you outsource from an expert, which means you guarantee quality to your customer. Second, you focus on your core, you increase your productivity, you’re better at what you do, so better service/product.
Don’t forget that…
You have to make sure that the company that will be helping you is qualified.
Some employees might lose motivation thinking that their job is at risk.
A lot of outsourcing companies ask to sign yearly contracts, which could make you feel like you’re forced to stay with that option.
Development outsourcing trends
The demand for cloud computing will keep on increasing, especially in northern and western EU countries. A big advantage of cloud computing is that scalability becomes easy and the costs are much more flexible because the client ends up paying for what they need and the costs of internal infrastructure become lower. Although it is more used by huge companies, we see that smaller ones are starting more and more to use that option.
The more you adopt digital technologies the more you can face an integration challenge. Usually, a a company does not have so many employees that are able to manage all that, and that’s why outsourcing integration services is a growing trend.
MOBILE APPLICATION DEVELOPMENT
The use of mobile devices keeps on growing and is here to stay, at least that’s what it looks like. Companies are therefore more and more demanding mobile application development, for their customers and for their employees. That’s why in outsourcing, specially for european countries, we can find a lot of outsourcing providers specialized in mobile app development due to lower costs and highly skilled resources.
SOCIAL APP SOLUTION
You all must have noticed that social media not only are part of our personal lives, but also at the professional level. As social media keeps on rising, it has become a must for companies to include social media activities to their strategies and they therefore need tools as for example tools to build marketing campaigns on social media platforms. What that means is that social application solutions will be more and more demanded.
If you could only imagine the amount of data there is around us you would be kind of scared. This has to be stored, managed and analysed in the right way to be able to provide insights to companies to increase sales, improves marketing campaigns, be more innovative and increase the customer’s satisfaction. You must know that is not an easy task, and if it’s done, it had to be well done. That’s why today, everyone needs to make use of those data to reach success, but many will be outsourcing big data solutions.
Security risk increase, specially with IoT everywhere, making millions of devices connected. It is expected to see more and more Chief Security Officers and companies will be going for specialized security vendors with Security-as-a-Service capabilities to protect data.
Companies used to look for low-cost people to do some tasks, now, they will be looking for machines to do them. Their will be more integration of robotic process automation (RPA) into the IT service delivery.
Tips for development outsourcing providers
One of the most important thing is to conduct a market research to be able to identify the regions and IT areas in which there are no high IT skills.
Stay up to date, learn about medium and long-term tech developments and news and try to provide and build those technologies.
OFFER CLOUD SOLUTIONS
The option of not offering cloud services is not an option. Some small companies have still not been through the switch but everyone will sooner or later so why not help them?
Invest in a secure and reliable infrastructure to be more convincing. Many buyers fear security of the cloud, so using à reputable cloud service provider would increase trust.
SOCIAL MEDIA IS ALSO FOR B2B
It gives you the opportunity to promote your company among potential EU buyers at relatively low costs. Make sure content is context-related and up-to-date.
BIG DATA, BIG COMPANIES
If it’s big data you’re going for, focus on big companies, they tend to be more interested.
Prove you professionalism. You need to have good references, ensure quick answers and strong communication, quality is always before quantity but you also need to know how to balance between both.
FEEDBACK IS KEY
You need and should regularly ask your customers for feedback about what you are doing good and what you could do better. This will help you get better and know where to concentrate your efforts.
Spain: development outsourcing
Northern EU countries such as the UK, the Netherlands, Germany, and Scandinavian countries are kind of saturated markets. With the maturity of this market and the the rise of global competition, more and more companies are adopting the outsourcing option when it comes to IT services/solutions. Obviously, these companies understand how development outsourcing works and they are quite demanding when it comes to quality, communication, expertise and experience.
Spain represents a great location to meet those countries outsourcing needs because we have a large skilled workforce and are quite competitive when it comes to cost for the quality you get. Spain has the human resources that are needed to deliver strong products and services in the IT industry, in fact it has had one of Europe’s highest ratio of technology graduates.
In development outsourcing, it’s not anymore about getting it done at a very cheap rate, getting a working software is what counts. For that you need to have skills and expertise and offer high quality services. At Apiumtech we’ve seen this as a great opportunity because we kind of guarantee all that. Over the years, we’ve helped great companies with amazing projects, and we specialize in Agile methodologies, offering transparency and great communication.