Internal or Outsourced Software Development: What should Your Start-Up Consider?

Author: James
November 28, 2018
Internal or Outsourced Software Development: What should Your Start-Up Consider?


Should you outsource the software development for your start-up or should you place your bets on an in-house team? This decision can impact your business substantially, but there is no one route that is more preferable than the other.
As a start-up, your decision could be driven by many reasons. For instance, you’d want to recruit top talent. Alternatively, you might want to cut costs. In reality, it is better to build a firm foundation, technically and strategically, before moving on to the decision of whether to remain in-house or outsource or to incorporate a mixture of both.
Here are some of the factors you should consider for making the right choice: 

Well defined Pre-Development Process  

The Pre-development process involves validating a problem, understanding the solution, conceiving a product and testing it repeatedly. These are important things to do before considering your hiring model. Analysing the technical requirements needed to build the product and understanding it thoroughly gives an idea of the scope of software development and the technology that is needed to pull these functionalities off.

It will also make sure that you don’t lose sight of your product’s key functionalities when you are hiring talent to service it.

The pre-development process helps start-ups realize their strengths and weaknesses. Start-ups can also make the choice to commit to either a specific part or the whole of the software development. Micromanagement, maintenance, and fixing minor technical problems are problems best left to those who have the time and the resources to deal with them thoroughly.  

Quality, cost, and delivery time  

While many companies consider the cost to be a huge driving force for outsourcing, a better approach would be to look at outsourcing from the lens of code quality. Along with code quality, other factors to consider when outsourcing include speed, quality assurance, technical expertise, security, and flexibility.

While more bespoke services can be done in-house, other components, when outsourced, save the start-up a significant amount of time and effort.

According to Amit Nabarro, hiring short-term project groups doesn’t work at all. After all, you are trying to use that powerful tool called product thinking to improve the quality of your solution and let it set a high bar. Says Nabarro, “developing a proof-of-concept and even an MVP with a consulting agency is a good strategy to move forward quickly without committing too many resources or growing the company’s personnel.”  

Quality, delivery time and security are crucial factors for hiringanyemployee, let alone an outsourced one. Tasks that involve complex and coordinated efforts are best outsourced, as you can then focus on the more critical part of your business – your product.

Defining the Scope of Work 

Many start-ups make one big mistake when it comes to defining the scope of their software development team. They expect that one of the jobs of an outsourced software development team is to help to define and develop their product. That is the start-up’s job entirely. Clear demarcations of functions and perfect organization can make outsourcing work for your company.   

The prize pig!

The choice you make depends on your in-house capabilities and your understanding of your product. Do you have people who can oversee your product’s development phase and knows precisely the kind of employees required for specific functions? Or would you instead focus on your product and its life in the marketplace while someone dedicates time and effort to the development entirely?

It is well worth remembering that one of the most critical factors for a start-up to succeed is one that an outsourced setup is primed to deliver – speed. This is especially true if the start-up is operating in a highly competitive domain. This could be your prize pig, if done correctly.