Software Development Outsourcing Models - How to Choose

January 7, 2022

Software Development Outsourcing - How to Choose? - Experts Zone Talks #15

Olga

Olga Vasylenko

Marketing Specialist
Przemek

Przemek Mikus

COO
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Software Development Outsourcing - How to Choose? - Experts Zone Talks #15
tech team(6)
team extension(2)

Let's talk about software development outsourcing models. What is the best way to cooperate with a software studio or other software development outsourcing companies? Team extension or Dedicated development team? Is there an alternative for them? What are the pros and cons? Which software team model fits your company? Get your questions answered.

In the "Software Development Outsourcing: How to Choose?" episode you will find:

  • 00:46 - Cooperation with software studios and how to choose the right model of cooperation with developers
  • 02:00 - Team extension model
  • 05:08 - Dedicated development team
  • 07:33 - Hiring freelancers
  • 08:56 - How to choose the right outsourcing software development model for the business?
  • 13:22 - Time to outsource software development. What to pay attention to choosing the cooperation model?
  • 20:16 - Story of a software development outsourcing partner

About outsourcing software development services you can also read more here: Custom Software.

Transcription

Olga
Hi, everyone. It's Expert Zone Talks and today we will speak with Przemek, Chief Operating Officer at Liki Mobile Solutions and Frontend House.
Przemek
Hi, guys. Olga, thank you for the invitation.
Olga
Nice to see you here today.
Przemek
Thank you that I can share some of my experience according to our operations and cooperation with our partners.
Olga
I can't wait for that. But first, let's watch Intro.

Cooperation with software studios and how to choose the right model of cooperation with developers


Olga
Today we will talk about cooperation with software studios and how to choose the right model of cooperation with developers. Let's see how we can work with software outsourcing companies. Przemek, what are the main models of cooperation with developers?
Przemek
Thank you for that question. Of course, there are many different possibilities of how to cooperate with the developers or with the development teams according to the software development or software development process. At the very beginning, you can decide if you want the team to produce the product as a whole, let's say, fixed operation. And then we just do the development from the very beginning to the end. And maybe after that there is a kind of maintenance on the project development or software development. But you can also decide to work with the developers on time and material models.

Time and material models cover many different types of cooperation. One of them might be, for example, a team extension model.

Team extension model


Przemek
So if we are talking about the team extension model, let's imagine the situation when you have your own development team inside the company. So, for example, you are a startup or major company that has some part of the software development team or tech team inside your company, and you have a lack of some experience, or need some special technology or wise support, or you might be interested in the production of some sophisticated, part of the project.

And then you can try to find a partner who will be working with you on the team extension model. This works like that the company that is supporting you in software development is kind of delivering or adding their own team to your software development team.
Olga
Like the whole team, not just one person, right?
Przemek
Exactly. Let's imagine a situation when you produce some kind of web page, but the whole project consists of a web page and mobile apps or another part of the digital products. So you might be interested in extending your team, for example, adding some more web developers or mobile app developers to your company - to give you the possibility to scale up the team and just produce more of the needed software.
Olga
These were comments on the team extension model, right? What about a dedicated team model?
Przemek
Team extension itself is maybe rather focused on special technologies. This might consist of your extended team, might be built with the experience of some sophisticated technology expertise or, for example, some kind of business vertical expertise. I mean that you might need a few or a bunch of people who will just help you extend or build your team up. And this is exactly as you said. It's not one developer. Let's say it’s more of them. It's a team that will be working with your team on your project. So that's about the team extension model itself.

Dedicated development team


Przemek
Of course, we can cooperate on a team extension model with some companies or products. But of course, you can work on maybe a bit more sophisticated ways to do the software or ways to produce the software. For example, you can think about the dedicated development team. So the dedicated development team is slightly different from the team extension model. Your dedicated development team is just a team that is built inside your company, who is partnering you with the software development. For example, some kind of software development agency or software house or whatever you want to call it - tech company.

So then internally, inside of your tech partner is created a dedicated development team who is dedicated exactly to your project. And it consists of some sophisticated bunch of people who is also experienced according to your project, or it's somehow prepared, or just involved only in your project. Okay? These might be a few words about the dedicated development teams. But of course, you can cooperate with the developers on different models. Sometimes, if you need only a few people who might help you, you might consider, for example, working with freelancers.

This model sometimes has pros, sometimes has cons. For example, pros might be that you can in some easier way find developers with special skills.

Hiring freelancers


Przemek
With freelancers, normally you work on some product and this is kind of, how to say, a quick win, and you have to add more management on your side. I mean, if you hire a few freelancers, you have to manage them by yourself, by your project manager, or something like that. And then the team that consists of a few freelancers, for example, might be spread.

Let's say there is more effort needed to manage the team that consists of freelancers. Normally, it's a bit easier when you have a tech partner who is responsible for their own team. He is working with them permanently and then it's just easier for you to manage that kind of team.
Olga
And to integrate them into your company, right?
Przemek
Might be. This is not black and white. Basically, let's say less effort is needed when you have an extended team or dedicated development team than a team of just freelancers.

How to choose the right outsourcing software development model for the business?


Olga
There are so many types and so many models of team corporations within software development companies. But how to choose the right for the business?
Przemek
Yes.
Olga
You mentioned tips on how to choose the right one.
Przemek
Exactly. So, of course, as you mentioned, there are many more models of cooperation in terms of software development. You can think, as we've been talking previously, about projects done on fixed price, or some pure outsourcing model, or body leasing, or different ideas on how to produce the software, and how to solve issues, or just deliver new products to the market. I mean, digital products. But exactly as you said, this is pretty much important to combine and to prepare yourself, your company and your partners, in the way what might give you the good output.

So, for example, if you have something that is very easy to produce, maybe even freelancers can just help you. This might be enough. Maybe if you need something to produce some sort of digital product or software, which is a bit much more difficult or just requires more attention, then it might be probably better to think about the team expansion model. For example, since then, you can cooperate with the team of developers, and you probably have the possibility to have much better output out of that. Maybe a dedicated development team might be also useful if you think about kind of long run.

I mean, if the project is planned, that will be produced in some specified period of time, I mean for longer, than the dedicated team…
Olga
What do you mean, longer? It's like six months and…?
Przemek
To be honest, there are no specified rules. But exactly, at least say a few months or more, sometimes maybe a few years. It depends. So in every type, when you decide on the different models of cooperation, and when you are thinking about how to go this way, how to plan the production, it's really good to have a partner who might be a kind of consultant for you. Who can support you from that standpoint and suggest a valuable solution for you. Sometimes this kind of advisor might support you in just choosing the right option.
Olga
It's really important to have such an advisor who will lead you and show you the right path.
Przemek
Sometimes you have somebody internally in your company, for example, you can have a CTO on board in your company. Sometimes this will be good if you have some kind of advisor or, let's say, a kind of CTO on hours, somebody from an external tech outsourcing company who might help you choose the right way. But as usual, it depends. And it is really good to dig down deeper, to go into the details and to have this possibility to plan, for example, production.

Time to outsource software development. What to pay attention to choosing the cooperation model?


Olga
So to sum up, we have to pay attention to the complexity of the project. The time - how long will it take. And maybe the third one?
Przemek
The budget, of course. Every project you do stands on three points. I mean the time, what gives us kind of timeframes to produce the part of the project or software. You can think about budget, of course, since this is a really good idea to produce the software with a budget that fits the demands. This is really important to be really well prepared on that side and not to spend much money on that. I mean, some functionalities that you might just don't need or something like that.

Yeah. And the third part is, of course, the team, thas to be really well prepared, has to have some good tech skills. Also, it's nice if you have a team that has experience with your business vertical. Since then, you can count on some advice and some ideas on how to solve some problems or issues. To be honest, a lot of digital products, or the software we develop, it's kind of revolutionary. I mean, pretty often those are the products that are able to revolutionize the market somehow.
Olga
And which model is the most effective while you're planning long-term cooperation?
Przemek
There is no one answer. To be honest, there is no one answer. Every time it's really good to do the investigation and really good preparation before starting the project. You can see a lot of pros on different models. It's not like that one of them will be the best, even if you would like to say that - this way it's really the best. But as usual, unfortunately, it depends.
Olga
Again, we don't have magic tips on how to choose something.
Przemek
Not so really, you can think, for example, about the complexity of the software development project. If the project is more complex, then you probably would have to think more about the dedicated development teams. If this is something not that complicated, maybe team extension is the right way. If something is really easy, you can think about freelancers. If you have the possibility to specify some functionalities, or some part, of the app or app as a whole, or website or some solution, then maybe a fixed price it’s really ok.

Since then, the responsibility is on the development team to deliver you the product as a whole. But usually, at present times, the team extensions models are safer for both sides. I mean, for the tech partners and solution owners. Since then, you can pretty easily adjust to the situation on the market. For example, there is a new Apple iPhone coming and you have to have your product prepared for this new device. And this is information that was not on the market a few months back.

So you have to recalculate the project and you have to prepare better for this new situation, what we will be having on the market. And then, looking from this standpoint, it's just more easy to adjust the production on the team extension model.
Olga
Let's imagine that we have already chosen the right model for us, for our company, and then we have to integrate this team or a few developers into our company. How to do that right?
Przemek
You can think about different ideas, but at the very beginning, pretty important is just this knowledge transfer process. You have to plan how to add an extended team to your team to have the possibility that the teams understand each other and they really understand what is needed in the project. What are the issues? What are problems to solve? What has been done before? What is planned to be present in the next steps? So at the very beginning, really important is this knowledge transfer process.
Przemek
Since then you have the possibility to have success at the next steps. Since then, the team that is attached to your product, to your company, has the possibility to produce everything in the right way.
Olga
So communication is the key.
Przemek
Communication is the key and also this process of transferring information. It's really important. Of course, that's the communication part, but not only. We have to think about some tech aspects of this communication.

Story of a software development outsourcing partner


Olga
We already know how to choose a team, how to integrate a team. Maybe you have some stories about your clients, or your partners, who have chosen one of these models and had some insights?
Przemek
Of course, we've been talking about the first layer of that. So let's say we didn't dig that deep into the details. I'd be happy to do that, maybe in the next episodes. But getting back to some examples, let's imagine that one of our partners is a Berlin-based startup that is working on some app that supports your mental health. I should not use the name at the moment of the partner, since we've been working there under NDA, but let's imagine a situation when you deliver the system that supports medics and employees to support mental health.
Olga
Really important nowadays.
Przemek
Yes. At the moment it is really important. So, they plan to have a web app and mobile app that supports experts in some, let's say, training and support on specific areas of mental health, as we've been talking about. And they needed some additional team who might support their web development part, since they have, luck of the development team. But they wanted to have the product delivered on some sophisticated time to have the possibility to go to the market with the product. And then they just asked us if we could take part in the project, adding our team to support them, to deliver their app and their web app, to have the possibility to be on time on the market. So this might be one of the examples.
Olga
So it helps to save time, not only costs.
Przemek
Yes, but that kind of cooperation gives you more. From one standpoint, if you extend your team with an external team, then you can, as you said, save time, for example. I mean, you have the possibility to be quicker on the market with your project. This is one thing. But second, is that the team extension model gives you the possibility to scale up the team quicker than you hire people onsite.
Olga
Your in-house team?
Przemek
Exactly. This is another pro of that. Next might be that this is adjustable for you. So if you decide after this part of the project that you don't need that big team for further development, you can say - okay guys. nice that you've been supporting us, but at the moment, we'd be happy to lower your engagement. And this is just cost savings for you.
Olga
Thank you, Przemek, it was a very nice interview. I hope we will meet in the next episode. And you too, I invite you to watch other videos on Frontandhouse.com and our YouTube channel. You can also visit our social media and see you soon.
Przemek
Thank you, guys. Olga, thank you for the invitation. I hope this might be a kind of value.
Olga
If you are looking for a software development outsourcing company, developers for a team extension model or a dedicated team, you can always contact Przemek via Frontendhouse.com contact form, and see you.
Przemek
See you. Bye.
Olga
Thank you, bye.

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Meet the authors

Olga

Olga Vasylenko

Marketing Specialist

Przemek

Przemek Mikus

COO

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