When you think of beginning a new development project, one thing comes to your mind: How to find skilled developers who can deliver a quality product on time.
Well, you’re not alone. Over 80% of employers, particularly startup owners, have the same question. Multiple options are available though, like in-house development, outsourcing, etc. The final decision depends on various factors, such as budget, timeline, available resources, and required skill sets.
It is a never-ending discussion. The supporters of in-house development cite benefits like data privacy, extended control, and customization options. Outsourcing, on the other hand, is preferred for its cost-efficiency, access to the global talent pool, flexibility, etc.
Which option is more feasible; it’s a difficult decision to make.
Let’s compare in-house vs outsourcing software development, discuss their unique benefits, and give the final verdict based on experts’ recommendations.
What is In-house Software Development?
In-house software development, also called insourcing, is the practice of building an internal team of developers and IT professionals. It involves hiring software developers locally and placing them in an onsite office.
Let’s understand this model with an example.
Suppose you are a large retail company with multiple offices across the US. Your HR team needs workforce management software to better manage your resources. Hence, you establish an IT department from scratch, hire developers, and purchase expensive equipment.
Your development team operates from your office and delivers the final system with the required features. Once delivered, the same team is also responsible for the maintenance and supervision of that system.
Benefits of In-house Software Development
Given below are some of the key benefits of this model:
1. Better Collaboration
Having an in-house team makes it easy to conduct face-to-face meetings and discuss important things. There are no communication barriers. Developers cannot only collaborate with their colleagues; they can also get insights from other departments for better results.
Hence, enhanced communication and open discussions create opportunities for seamless product development and continuous improvement.
2. Enhanced Control
The second benefit of in-house software development is that it gives you more control over your team, product, and resources. You can manage the team size, skill set, and operational expenses. Besides, you get complete ownership of the product under development. There is no risk of breaching intellectual property rights.
Moreover, an in-house team is also available for a range of other IT-related tasks in addition to development. Making quick changes to your product or work schedule is no more a headache. The team directly reports to the higher management and briefs about the ongoing progress.
3. Growth Opportunity
The global software development industry including cloud software development is growing at a high pace. New startups are being established. The latest technological advancements have opened new doors of growth for well-established businesses.
Insourcing, therefore, can be an opportunity for you to enter the IT sector. You can build a team of qualified IT professionals and sell your services to other businesses. The in-house team not only works on your product but also helps you expand your revenue sources.
The result is long-term growth and sustainability.
Outsourcing Software Development
Outsourcing is very popular in almost every sector, including software development. This model gives employers the flexibility to hire resources with their desired skills for a limited period. Companies can outsource operations to third parties to meet their short-term needs without bearing overhead costs.
Consider the same example of a retail company. You need workforce management software but don’t have the technical expertise to develop such a product.
So, instead of developing an in-house team, which requires a lot of budget and specialization, you seek proposals from software development companies. They have proven expertise in building customized enterprise solutions per users’ needs. After careful evaluation, you select an outsourcing partner that promises to deliver the final product within your budget and deadline.
Benefits of Outsourcing Software Development
Working with a reliable software development outsourcing company offers the following benefits:
1. Cost Efficiency
Outsourcing is a very cost-efficient model. As an employer, you don’t have to bear the costs of hiring, training, and onboarding new developers. Similarly, there is no need to establish expensive IT infrastructure onsite. Your outsourcing partner can take care of all these requirements.
Client, like you, just has to pay for software development services on an hourly or monthly basis. This way, you save your time and money and invest these resources to expand your business.
2. Access to Specialized Resources
The internet has converted our world into a global village. Any resource, professional, or client is just a click away. The same advantage can be leveraged in outsourcing.
Experienced software development outsourcing companies that provide outsourcing for startups have a pool of talented developers and software engineers. You can hire IT resources with specific expertise and get your work done at low costs. There is no restriction of time or place. The whole developers’ community is open in front of you.
3. Quick Turnaround
Outsourcing is a great way to benefit from the time zone difference and ensure business continuity without any interruption. Didn’t understand this concept? See this example.
Suppose you have hired an outsourcing company with offices in the Pakistan and US. Your outsourced team can operate 24/7 because the day at one location is night on the other. That means when one team has gone home, the second one will be working on your project.
In the end, you can meet tight project deadlines and ensure a quick turnaround by outsourcing software development to an external agency.
Final Verdict
We have compared the in-house vs outsourcing software development and explore their key benefits. Now, it’s time to decide which model is ideal for businesses.
The in-house option is better if you have a well-established organization with expertise in software development. The model will give you better control over your resources and intellectual property. Besides, the risk of losing confidential data and information is very minimal in this case.
However, startups with limited resources and experience in software development should never take the risk of building an in-house team. Instead, they should prefer working with an external outsourcing agency to reduce their development costs and access specialized resources.
