Many organisations face a dilemma of whether they must hire an in-house development team or outsource development work to a software services company. This article analyses both practices and helps you choose between them.
What is meant by in-house development?
In-house development means making use of the company’s own resources (financial, human and technological) to create software required for the company’s business. In this method, the company needs to invest in putting together the right people in the right roles. The company needs to have enough good resources and infrastructure in order to develop software in-house.
What is meant by outsourcing?
In the outsourcing model, a company simply delegates all aspects of the software development activities to a vendor, which is a software services company that specialises in this kind of work, instead of doing the development in-house. The vendor takes care of all the aspects like getting the right people, allocation of tasks, budget allocation etc. Outsourcing is usually done by companies who do not have IT as a core competency.
Advantages of in-house development
- The in-house team has excellent understanding of the company culture and the businesses.
- The team is completely dedicated to the project.
- No cultural differences and language barriers.
- Face-to-face discussions between the business team and development team can happen whenever required.
Drawbacks of in-house development
- Cost of hiring the right team.
- High investment in technology infrastructure.
- Need for ensuring the presence of the required skill and competencies.
Advantages of outsourcing
- Cost savings.
- No need to hire people.
- Access to a variety of skills in the outside world from various vendors.
- Company can focus on core business instead of IT.
- Faster time to market
Drawbacks of outsourcing
- Less control over the development process.
- Cultural differences and language barriers.
- Confidentiality issues.
In-house development is a lengthy process
It is not enough to check out the advantages and drawbacks of in-house development vs outsourcing. There are some other things to be considered. Take the in-house development process. Here are the steps for the process, which is quite lengthy:
- If your business is ecommerce, then assume that the company wants an inventory management software. Then first, the request needs to be sent out to the business analysts.
- The business analysts prepare a requirement document listing out the resources required.
- Then the recruitment team needs to be contacted to hire the developers, testers, project managers and other people for the team.
- The recruitment team announces the job vacancies, reviews applications and conducts the recruitment process, all of which might take weeks to a few months.
- The team needs to be assembled after hiring, and needs to start the development process, which will take some more time depending on the complexity of the software and the issues that arise during the process.
In addition, the hired people might require training. They might also leave during the process, which requires getting replacement people. The company needs to be prepared to face all these hassles before choosing in-house development.
Outsourcing needs due diligence, but has less hassles
Initially there will be some hassle as the company needs to do due diligence to identify the right vendor. Research needs to be done to find out software companies capable of providing the services, and referrals need to be sought. But once the right vendor is identified, then the project can be done at lesser cost and in less time. The cost is less largely due to the salary difference between developed and developing countries. The software has a faster time to market because the company can dictate the schedule and the vendor can provide the resources accordingly.
If you choose to go with outsourcing, then ensure you must bring on board a trusted Custom Software development company. We at Acropolis can be your trusted advisors and provide you with our services to take care of your outsourced needs. Contact us right now to have our technology experts at your service! All you need to do is have a detailed discussion with us about your needs, and upon your approval of our recommendations, we will help you achieve your business goals! And at affordable rates too! Even better, our services are available to businesses anywhere in the world! We cater to clients from US, UK, Australia, Germany, France and many more countries!