Outline:

• Factors to consider while choosing an outsourcing company

• DON’Ts of outsourcing

• Sonerim Checklist for ‘Perfect Outsource Fit’

We’ve already discussed the pros and cons of outsourcing software development in one of our previous articles. In this article, we deal with the preparation and selection process stages. At the end of the article, you’ll also find a checklist to use before you decide on an outsourcing company for your project. 

Factors to consider while choosing an outsourcing company

Stage 1. Before initiating an outsourcing project

• Identify your project goals, objectives, and timeframe requirements. Be specific about the scope, scalability, and specific technology, if applicable. If you aren’t tech-savvy, a good place to start will be a simple list of requirements accompanied by basic mockups and a workflow. 
• Consider the budget your company can allocate for a project without compromising the quality. To get some benchmarks, compare free project estimations from prospective vendors and the price ranges they offer. Pay special attention to the lowest and highest prices to not miss any potential complications or risks. Don’t spring for the first company that offers to save you the most money – weigh the advantages and disadvantages of several shortlisted businesses. Also, you shouldn’t overpay for services you don’t require.

Stage 2. Determining the right software development company

• Check available data on a company’s experience and evaluate its industry expertise. Review its website and the portfolio of past projects, accomplishments, and distinctions. If a company is experienced enough, it knows where the most dangerous pitfalls lie and what turns must be avoided on the route to a successful product.
• Read the company’s reviews given by real customers in open international sources, such as Capterra, G2, Clutch, GetApp, or Trustpilot. These ranking websites can offer many insights through different comparison parameters.
• Ask for direct feedback from the company’s clients. Try to talk with them in person to get their opinion on your prospective partner. 
• Understand the work culture of a software development company. You can examine its office (directly or virtually via social media) and speak with employees to get a sense of the working environment. 
• See how the outsourcing company copes with the following: the way they build the work process, the speed and quality of giving feedback, the process of studying the project before launching, and the creation of a technical documentary with stages and goals to be achieved. The more questions your potential partners ask at the beginning, the better: they need to fully understand your business needs. 
• Check the development methodology (if the company uses Scrum or another Agile approach). See if it has a well-documented project development process that embraces adaptive planning, early delivery, frequent updates, and advanced communication tools.
• Examine how the company conducts testing and how long and at what price it handles its backup services, support, and maintenance. 
• Evaluate security policies and other organizational documents. Check how the company deals with risk management and if it has a solid plan for unforeseen circumstances. This plan should include contract compliance reviews, regular performance assessments, and other measures aimed at mitigating risks.

Tip: You can create a long list of candidates, evaluate them by several significant factors, put all results on a web diagram, compare them, and get a short list of the best candidates (see the figure below):

Source: Softkraft

Stage 3. After making the commitment to a particular outsourcing company

• Sign a strong, detailed contract with a pricing model appropriate for your company. Get into an airtight non-disclosure agreement concerning sensitive data, all the rights of codes, financial information, and post-deployment rights. 
• Establish good communication with the selected team (see our article on cross-cultural communication in software development projects). You can use various applications (Google Hangouts, Skype, Slack, etc.) for consistent monitoring and gaining insights in real-time. 

DON’Ts of outsourcing

A simple mistake can cost a lot of resources, time, and effort. To prevent it, avoid the following:

1. Too good to be true. 

Cutting costs alone isn’t a great base for outsourcing – such seemingly beneficial deals can have serious repercussions. Don’t be cheap in this quest. 

1. A lack of proper strategies. 

Crafting a project vision and a plan is advisable for companies that are getting into outsourcing for the first time. However, don’t create an excessively detailed plan because its actual continuity can’t be supported dynamically.

1. Outsourcing too many roles at once. 

You must strategize your purpose in delegating your functions. Sometimes, rushing too many functions to outsource at once could harm your project. The most important thing that can’t be outsourced is your unique project vision – the rest can be delegated with some reserve. 

1. Abandoning your team. 

Don’t let your outsourced team work on their own. Engage with them, make them feel they are a part of your company, and help them live up to your expectations.

1. A lack of a backup plan. 

A backup strategy can help save your brand identity and reputation from damage that could be caused by outsourcing vendors that don’t live up to expectations. 

Sonerim Checklist for ‘Perfect Outsource Fit’

Below is a checklist that can help you find the right outsourcing company for your software development project. Follow these steps to get a match made in heaven! 

		Shortlisted Companies
	CHECKLIST	1	2	3
1.	Check a prospective vendor’s website – tech stack, previous projects, price range, time zone, command of English, and communication channels.	☐	☐	☐
2.	Check a company’s reviews at ranking websites, its image on social media, and direct feedback from present/past clients and/or employees.	☐	☐	☐
3.	Check if you have a backup strategy.	☐	☐	☐
4.	Check if you have defined milestones and deadlines for your project and determined KPIs and essential metrics.	☐	☐	☐
5.	Book a call with a company’s manager to fill gaps, set clear expectations, and communicate your requirements in detail.	☐	☐	☐
6.	Check if you have received a project roadmap from a future vendor.	☐	☐	☐
7.	Check if you have seen and approved a list of expenses.	☐	☐	☐
8.	Check if you have signed a non-disclosure agreement.	☐	☐	☐
9.	Check if you have held an introductory meeting with the outsourced team.	☐	☐	☐

Be meticulous while choosing a trustworthy outsourcing agency. What can help you make a maximally informed decision? It’s our checklist above, covering all the essentials. Good luck with your search!

Sources:

https://www.softkraft.co/how-to-choose-software-development-company/

https://www.entrepreneur.com/growing-a-business/what-not-to-do-when-outsourcing/387202

https://optibpo.com/blog/factors-to-consider-when-outsourcing/

https://www.tatvasoft.com/outsourcing/2021/08/things-to-consider-when-outsourcing-software-development.html

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