January 10, 2017 enqos

6 Things your Mom never told you about Outsourcing Software Development

 

outsourcing

 

Most people have a certain set of preconceived notions when they hear the word “Outsourcing”, particularly for software development. There’s the usual stigma of lower quality, missed deadlines, and constant miscommunication that (justified or not) tends to drive companies away from outsourcing software development.

However, things are changing rapidly, and software development done through virtual teams is becoming more effective and valuable for businesses. As co-located virtual teams continue to emerge, companies are coming to terms with how these teams are increasingly competitive with typical in-house development.

In fact, 34 percent of the U.S. workforce today consists of virtual freelancers. These virtual teams are allowing both startups, and enterprises, to scale their development teams in a flexible manner as natural extensions of their in-house teams.

And that makes these virtual team developers just as invested in the success of the product as the in-house team, which is the what businesses typically don’t realize about today’s environment.

It’s why Enqos was able to save one startup client $1 million in development costs, and 80% in developer burn rate.

Those are just some of the things that many people don’t realize about today’s virtual development teams. Here are some of the other major key advantages, and why you need to consider implementing virtual development teams for your business.

1. Virtual Teams Extend Internal Teams

 

Thanks to advances in project management and software development tools, like Basecamp and Github for example, the productivity and communication required to manage virtual teams and projects is getting much more simple.

For communication, you have tools like Skype, WhatsApp and Google Hangouts. Productivity collaboration is becoming easier with Google Apps. Slack, Trello and Atlassian are making project management for virtual teams that much more effective. And in addition to GitHub, TFS and Travis and lending a hand in terms of code management. See our blog on 15 online collaborative tools to manage virtual teams.

Moreover, virtual team developers usually come from an agile product development background and are experienced in conducting daily stand-up meetings to make sure the project is on track. Virtual team members have become equally as invested in the success of the product as internal teams.

Take the case of Adobe, for example, when they were searching for ways to develop a new graphics conversion software. Adobe made the decision to use a virtual team because of the rapid turnaround time they required to bring the technology to market, in addition to the wide array of developer skills required to complete the project. Orbital, the virtual team partner they worked with, helped establish virtual teams specific to different areas of the project where their skillsets could be best leveraged for a certain amount of time. By extending Adobe’s in-house team in such a way, they could develop the graphics conversion software within a tight time window, and with minimal managerial resource allocation from Adobe.

 

2. Helps Bring in Hard to Find Talent

 

Hiring top software development talent is tough, especially for full-time roles. It gets even harder if you need to hire within a specific geographic region or tech vertical. Virtual teams broaden the talent pool that help companies overcome this challenge. This is especially beneficial to startups, where a local talent bench may be limited and developers may desire to work for more proven companies.

For example, through Enqos’ virtual teams, you get 100% dedicated developers that are part of your team, without the hassles of operational management.

Take the case of India, for example. The average salary for a software developer is about $20,000-25,000 per year, where it would cost $100,000 to hire an equivalent developer in the United States. However, Indian software developers tend to come from excellent educational backgrounds and are focused on serving enterprises in the UK, European and American markets.

So not only are you getting great talent at a great rate, virtual teams are now doing everything they can to reduce cultural and communicational friction with western enterprises. And according to recent surveys, 78% of companies feel comfortable utilizing virtual teams in India for technology projects.

 

3. Increases Collaboration and Energy

 

Bringing in virtual developers to work closely with your in-house team is great for increasing collaboration. Your in-house team will learn to collaborate with virtual developers towards the same goal, and virtual team members often bring a fresh perspective to stubborn problems.

Virtual teams create a vibrant ecosystem and work environment that brings engineers and developers with different skill-sets together. This energizes people on both sides of the equation, as there’s a constant stream of activity, learning, communication and innovation.

Smart organizations are now doing everything they can to enhance virtual and in-house collaboration because they see how it impacts the bottom line. In one Harvard Business Review case study, one software development company even went so far as to appoint a Global Product Development Director who was responsible to coming up with ways to further collaboration. By doing things like bringing in virtual team “liaisons” on-site to interact with the in-house staff, and creating awards to generate competition among all developers, they could decrease staff turnover by 80 percent.

 

4. Outsourced Teams aren’t just “Freelancers”

 

If there’s one major misconception about virtual team development, it’s that the people you hire are mere “one and done” freelancers or temporary talent. With today’s virtual co-located teams, companies have the option to save money by hiring teams on longer-term contracts.

Yes, it is possible to hire freelance, project-based talent through job markets like UpWork, but smart organizations tend to avoid this model. That’s because freelancers aren’t truly vested in your product or company. And the costs for continually hiring freelancers adds up over time, as opposed to dedicated virtual teams.

On the other hand, hiring a virtual development team means that you have full-time, dedicated resources that are incentivized to make sure your product succeeds in the long run.

Virtual team partners like Enqos realize that companies are demanding more dedicated outsourcing teams, and are taking steps to innovate for the future. One of their clients, Runway2Street, used virtual teams in India to build a sophisticated digital marketplace enabling brands to connect with customers worldwide. They employed teams for a variety of languages and tools, including PHP, Microsoft Azure and Apache. In the end, Runway2Street was able to build 4X of the product with Enqos’ virtual teams, putting them in a stronger position for investors.

 

5. Relieves Secondary Task Burden

 

More than likely, your in-house development team has quite a bit on their plate as it is. These are your most trusted engineers, and in a perfect world they’d do nothing but focus on making the best quality product possible. However, routine or mundane tasks can get in the way and be a time suck for those developers.

That’s where virtual teams can really make an impact, in relieving some of the secondary task burdens for your developers. Routine debugging, for instance, can easily be assigned to virtual team members and allow your in-house team to do more of the mental heavy lifting.

 

6. Lowers Overhead Without Sacrificing Quality

 

Of course, when people think of development outsourcing, they think of hiring cheaper talent to save money. Yet they also assume that this comes at the cost of a quality product, which simply isn’t true with today’s virtual co-located teams.

For example, Enqos worked with brand and audience engagement company Parllay to develop their marketing cloud platform. With the help of virtual teams, Parllay developed a world class product with features including Social Experience Management, Audience Intelligence, and Digital Asset Management. The four-year partnership and eight people virtual development team resulted in over $1 million in cost savings and a 60% burn rate, without sacrificing the top-notch quality demanded by Parllay and its customers. Parllay is startup founded by Microsoft Execs building a marketing cloud product on par with the likes of Salesforce and Oracle.

 

Conclusion

 

It’s 2016, and today’s virtual teams are a far cry from yesterday’s freelance outsourcers of the past. Outsourcing software development now through Virtual Teams means that companies can extend the functionality of their in-house teams, find the talent they need, and deliver quality products at a reasonable rate.

So, don’t be afraid to re-think about whether or not you employ virtual team development. At the very least, it’s important for business owners, managers, and leaders to recognize the changes that are taking place and how it might benefit their development and hiring strategies.

 

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