How to overcome software outsourcing challenges

Emilien Coquard
4 min readSep 20, 2022

There is more than 92.5 billion dollars worth of global outsourcing for software development, with software development accounting for the largest share. The outsourcing of such a vast industry will be fraught with cultural and technical hurdles and hidden costs. This article will help you identify these software outsourcing challenges and provide you with simple solutions to solve them.

Cost cutting has always driven outsourcing, but many organisations face unexpected challenges they have no idea how to handle. We will discuss some common challenges and how to resolve them all at once instead of attempting to fix them one at a time. And, how going offshore instead is an ideal solution.

How does outsourcing compare to offshoring?

In outsourcing, contractors are hired directly for one-off projects by working with third parties. It’s one of the least expensive working methods, and it’s typically used by businesses looking to reduce short-term operational costs.

Nonetheless, companies shouldn’t hire or outsource engineers just for this purpose. ‘Offshoring’ is often the best approach since it involves hiring a dedicated team that can commit to achieving long-term goals. In some cases, it may not be the most cost-effective solution. Even so, it allows companies to tap into a pool of highly educated and talented software developers and is built to avoid the most common challenges associated with software outsourcing.

What are the common problems with outsourcing?

Although outsourcing software development is a large market, several problems can arise. These issues actively discourage most clients from considering it. However, most of them can be examined and avoided in future collaborations. We have identified several software outsourcing challenges associated with software development:

Outsourcing rewards quantity over quality

Companies typically select outsourcing companies that offer the best deal since the lowest price is the primary consideration when outsourcing. A company may assign developers randomly to a project to meet deadlines and complete tasks on time. There is no way for you to interview them, find out about their technical experience, or determine if they’re qualified for the job.

One of the significant software outsourcing challenges is that the work isn’t always of the highest quality because the contractors you work with serve various clients simultaneously. For this reason, outsourced engineers do not always reflect the interests of their clients and may not fully comprehend the nature of the project or the company.

A lack of control over ‘your’ team

Maintaining control over your outsourced team is also one of the most apparent software outsourcing challenges because the team is not based in your local office but overseas. Moreover, they’re never truly ’your’ team as they operate as independent contractors and therefore lack the transparency your organisation needs.

Successful organisations need an internal expert to verify that they avoid common software outsourcing challenges. However, using a third-party vendor for development means you won’t have immediate access to your internal team. So you cannot delegate, for instance, quality assurance work to a team of skilled and reliable QA engineers if you’re too busy as a business owner. And, you simply don’t have oversight over the product development and expertise is kept external to your business. Not to mention acquired capability and knowledge — which will be lost if you break ties with the vendor.

Undisclosed costs may be hidden from you

One of the most prominent software outsourcing challenges organisations faces is underestimating costs. You’ll have to deal with hidden fees, such as extra equipment, overtime hours, and timeline extensions.

You can bet the quality will be pretty poor if you hire engineers through an outsourcing partner significantly less than hiring locally. Financial difficulties will undoubtedly affect the quality of the software and cause ongoing delays.

Risks associated with accidental data loss and theft

Outsourcing software development can lead to data loss. Cybersecurity and intellectual property protection are two issues that arise when working with outsourced teams. In the modern era, data is everything. The loss of it, no matter what the reason may be, cannot be tolerated. Unfortunately, expensive data losses are common due to large amounts of data.

A major issue with outsourcing is that you must ensure sensitive data is handled appropriately and that there are no security breaches since it can be one of the most complex software outsourcing challenges. With offshoring, the extended team will mirror your ‘home’ protocols to ensure the highest standards and security of your IP and code.

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