4 Tips on How to Gain the Most from Software Development Outsourcing

4 Tips on How to Gain the Most from Software Development Outsourcing

When it comes to software development, it often is a never-ending world of new functions and features to add to a product. Regardless of the niche your product aims at, it is imperative to keep track of the tech updates, trends in your respective field, and, most importantly, user preferences.

With all the substantial changes come significant expenses. Indeed, the software development process has never been cheap. However, it does pay off if business owners consider all the important components of a successful product launch.

An increasing number of organizations have been switching to IT outsourcing rather than having in-house development teams. The reason behind this is simple: it is simpler to hire an experienced team of specialists who will take over the development process rather than going through a tedious process of searching, sourcing, and building a team from scratch. Therefore, business owners will spend a lot more time creating the product and lose money eventually. So, why is it better to outsource your software development, and what are the significant aspects of finding and hiring the right team?

#1. List all your requirements for the product and define your budget

Once an idea for a project is born, the first and utmost would be to put everything down. As you go further, you expand the list with new things to add or improve. This way, when you start looking for a dedicated development team, you know what you want. Additionally, they'll be able to see what you expect from them. By having all your goals and deadlines set, it is easier to seek the right people to do the job. This will save you a ton of time during the development process.

When starting a project, your outsourcing software development partners will go through the details and help you build a detailed plan with all the deadlines and costs. That will be your major starting point as you will see what to expect and how much it would cost.

#2. Carefully choose your IT outsourcing provider

This is another major hurdle that may lead to significant money loss. Therefore, it is important to carefully source your potential partners. High-quality service cannot cost too little. When you have an established budget, analyze the market to see how possible it is to stay in it before hiring the team. An issue that may arise when chasing the cheapest provider can cost you even more. This is because they may fail to fulfill their obligations.

Always look at the company’s portfolios and client reviews before you make your final decision. As the number of software development outsourcing providers in the world is huge, it can be quite easy to get misled. Moreover, pay attention to the technology stack they offer and whether it is what you are looking for.

And, finally, consider the company’s internal culture, communications, and locations. These aspects are crucial as you move on with the development process. After all, you want to have a partner who shares your values, has a similar mindset, and can be easy to reach out to. From that perspective, many European and American companies often hire Eastern European developers. These are primarily from Poland, Ukraine, Romania, and the Czech Republic. They are open to discussion, well-educated, and willing to give their professional opinion on what would be best for your product. In addition, you’ll have no language barrier, as the majority of the IT specialists from the region speak English fluently. In case you're new at this, to help you decide, you can check for companies here:

#3. Find out the pricing model that will work best for your project

After defining the goals and budget of your project, many IT outsourcing software development providers will suggest you pick a cooperation model for future billing. Based on the example of Agiliway, we will describe the main cooperation models that work best for us and our clients.

  • Fixed price is recommended for projects with a clearly outlined scope of tasks. For example, pilot projects, where all the issues are listed and may need only some minor changes or add-ins.
  • T&M (hourly rate) is preferred for projects with a dynamic scope of tasks. This could include UI designs, DevOps, Project management, etc. Hiring under this model is often needed as a tool for strengthening a core development team at times of peak loads.
  • Dedicated Team (monthly rate) is what you need when you are looking for a full-time and full-cycle development team for long-term projects (usually over 12 months). Under this model, the team normally operates utilizing Scrum or another agile methodology.
  • COST+ model is similar to the Dedicated Team model with a slight difference. Agiliway hires and takes care of the entire development team, while the project management comes from our client’s side.
  • BOT (Build-Operate-Transfer) model is akin to COST+. BOT presupposes the transfer of the entirety of the legal rights and the team to our client once the contract is over. Therefore, they get not only the product but also an established team who knows the product inside and out.

Regardless of the model you choose, it is always possible to contract a combination of these models. Everything depends on the project and what it may need once the development process starts.

#4. Stay away from unclear clauses in the contract

When the time comes to sign the contract, both parties shall carefully draw up and go through the contract clauses. This is to avoid any losses on both sides. Why do we emphasize that both parties shall do that? Not only a client but a service provider must be protected. For example, a client refuses to pay for reasons that are not related to the services provided. Each party is responsible for following its obligations. So, to not lose money, a vendor shall state the reimbursement in case of payment failures.

However, a client shall also draw up their terms for delayed deployment at any stage of the development process. If that is not something that falls within the force majeure clause, then it all is subject to legal action.


Bringing an IT outsourcing model into a business is no longer something strange or new. It has proven to have helped organizations across the globe to build their products without wasting their time, resources, and money on something vital but rather complex.

When you are outsourcing a software development team, go through their portfolio, tech stack, corporate culture, etc. to see if you two match. As you partner with professionals, ask for their advice, and do not be afraid to rely on them.

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