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When your business is in need of software services, the common practice is to approach vendors who offer these types of utilities. Reduction of cost along with access to talented and qualified professionals are the benefits of hiring these providers.

If you are going to outsource software development, you need to make sure you choose the right model to get excellent service from the vendor. When it comes to selecting a provider, you need to make sure you look at certain factors, which will determine whether they are a good partner.

Reputation, experience, pricing, location, and policy are some core elements that will play a role in choosing the right vendor. At the same time, you need to make sure you select the right model, as it will have a significant impact on the total cost. Given below are popular frameworks among businesses that outsource software development:

Dedicated Resource Hiring

For the dedicated resource hiring model, you get access to specialized software development professionals. There are two choices that you can choose when it comes to this type of outsourcing:

Staff augmentation

This is a popular option among businesses that already have an internal team working on a software project. However, due to the lack of specialists in various fields, these companies need external help to ensure they can continue this venture.

For example, your team needs professionals who specialize in quality assurance, business analysts, and UI/UX designers. In this situation, it doesn’t make sense to hire new employees, as the entire process is time-consuming. On top of that, these roles are temporary.

When you choose to augment, you get to define the quality, style of management, and processes of the project. At the end of the development, you have the option to continue using their services by renewing the contract. For long-term collaboration, this is an excellent move. The reason being that your team also gets to learn new skills from the hired experts.

Dedicated Team

Another reason for choosing this model is to have a dedicated team to handle the project. The vendor is the one responsible for the quality of the process, all development-related tasks, and people management.

Businesses choose between dedicated team and augmenting their staff as it is much cheaper than hiring professionals from their respective countries of operation.

Project-based Outsourcing

Project-based outsourcing is when your company hands out the entire development plan, including all-related tasks to the vendor. The reason why businesses choose this option is that they don’t have qualified professionals or inadequate number of employees. Companies also prefer project-based outsourcing when they don’t want to maintain a dedicated, in-house team for this venture.

When you opt for this type of service, you and the vendor sign a contract. It contains all the requirements, along with the tasks the provider has to complete. When you choose this outsourcing model, you need to keep in mind that it requires pre-planning.

Again, there are two subcategories to project-based outsourcing:

Fixed Cost

In this one, you predefine the scope of the project, due to which you have to pay a standard amount. If you make any changes to the scope, the vendor will estimate the charges separately. Any alternation to the budget will require your approval, before going ahead. The timeframes for the fixed cost is straightforward.

Time/Hourly & Material

The second option is common when companies don’t have a clear estimation of the scope of work. As choosing the fixed cost model can become expensive, it makes more sense to choose this one.

It gives you the freedom to shift the project development and concept flow, as per your requirements. The amount you have to pay depends on the developers’ skill level, along with the number of hours they put in every day.

When it comes to project-based outsourcing, companies combine the two sub-models. For example, during the preparation stage, businesses will enter into a time/hourly & material framework contract with the vendor. As a result, they can work with you during the planning phase, which is beneficial to your company. The next step is to convert the contract into a fixed cost one.

Every business, regardless of the domain, requires software services. Technology enables your business to hire developers from all over the world. Your company needs to make sure the vendor along with the outsourcing model, will determine the success of your venture. Use the information in this guide to augment your knowledge of what constitutes a good partnership.

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