Four Questions about Outsourcing and How to Address Them

Companies looking to outsource their software development often have questions about quality and return on investment. There are many factors that affect the end-result, especially with companies that are overseas. We’ve made a list of four main questions that companies may have when considering whether to outsource their software development to an offshore/nearshore firm:

1. Will we really experience a cost savings?

In principle, outsourcing saves the client from the expenses of hiring labor, maintaining infrastructure, and managing materials. Unfortunately, sometimes companies offer less than skilled labor at a fraction of the cost. This means that the development takes longer, and you might not end up with a quality result.

Overall, there is still significant savings using offshore and nearshore solutions. Let’s say a quote is shockingly low then you should really investigate whether that company can produce custom software that meets your needs. Consider the cost of risk management and how much time your in-house project manager will spend over-seeing the project. Find a software development company that will be transparent about the cost of offshore or nearshore outsourcing, and check their track their record.

2. Will we face communication challenges?

Good communication is fundamental for the success of any software development partnership, but “communication problems” is one of the most frequently cited problems in failed offshore relationships.1 There are a few specific items to consider when you’re looking at different offshore or nearshore companies.

Do you feel comfortable communicating with the members of the team? Schedule introductory meetings with the development Team you are considering, so you know you are comfortable with them before you proceed to the scope of work or any project planning.

Can we schedule daily and weekly meetings? This can be a challenge if you choose to hire a company in a significantly different time zone. Although the Philippines and India are two of the most popular locations for offshore companies, they have around a 12 hour time zone difference with companies in the US. Time zone differences matter, so consider companies near or in the same time zone as your company. Also, ensure that you can meet on a regular basis without having to schedule well in advance.

3. Will my intellectual property be safe in another country?

The way governments treat intellectual property law varies from country to country. Concerns over intellectual property protections are valid because the Chinese government is known to be lenient on Chinese firms found making counterfeit products.2

Mexico mirrors the United States in their intellectual property laws, held to standards set by NAFTA and other bodies like the Berne Convention.3 NAFTA also requires member countries to have enforcement procedures that are similar to those of the United States, such as general due process, injunctive measures against infringing goods, and payment of damages for injury suffered.4

4. Will outsourced software be high quality?

Many development companies focus on winning a software development job, so they don’t clearly represent their skillset and expertise level. Be prepared to ask direct, detailed questions about companies’ experience, past projects, and process. Check what infrastructure they offer, and understand how they perform quality assurance on their code.

At Tiempo Development, we have experienced developers who focus on a wide-range of technology areas. We can walk you through these areas of expertise and past projects that showcase them. We have also created (and fully tested) a proprietary development system called the Tiempo Quality System. You can read more about TQS here or contact us with any questions you might have. Not every software development company will provide high-quality results, but we provide exceptional work and references. To learn more read about how we’ve helped our clients in our case studies.

  1. Messer H. Bridge-Staffing. http://blog.bridge-global.com/solve-communication-problems-offshore-outsourcing. Dec. 21, 2010.
  2. House Hearing, 109 Congress. U.S. Government Printing Office. http://www.gpo.gov/fdsys/pkg/CHRG-109hhrg21813/html/CHRG-109hhrg21813.htm
  3. Fran S. Nafta’s Intellectual Property Provisions. Dr.Dobb’s: The World of Software Development. http://www.drdobbs.com/naftas-intellectual-property-provisions/184409468
  4. Ibid.