In-House Versus Outsourced Software Development

by DHx Software | Apr 26, 2021 | , , | 0 comments

"There's an app for that." The claim that a software application can do almost anything is true. Today apps are used in almost every aspect of business from marketing, to shipping, to customer care to employee benefits. Maybe your small business is considering a new one now. Software development is no small task, and you are going to have to decide whether to do it in-house or outsource the project.

Software development remains a challenge for many small businesses--even those with strong IT departments. Advanced custom systems level the playing field with larger competitors and allow for accelerated small business growth. But you need a talented team of specialists, and that can become a time-consuming and expensive process if you want to handle software development in-house.

Outsourcing can have issues as well. Offshore outsourcing to the leading software development organizations in China, India, and the Philippines comes rife with challenges like time zones, language, culture, and even legal systems. 

So, what’s the answer? How can your business develop the software it needs to grow while maintaining a focus on its core competencies without interruption?

Pros and cons of In-House and Outsourced Software Development

You know you need the software, the question is, who is going to build it? Consider this:

  • Having your own staff has the obvious advantages of full-time availability, familiarity with the company and culture, the experience of working as a team, and relative ease of communications with stakeholders. 
  • On the other hand, the average app takes over 1800 man-hours to develop. How engaged is your team already, and how will a new project impact existing operations? Adding new software staff is time-consuming and getting more difficult to accomplish. The demand for the skill sets required has exploded. According to Glass Door, over 1 million software developer jobs went unfilled in 2020.
  • Cost efficiency is typically the number one reason companies turn to outsourced developers for new projects. Successful companies focus on core competencies and contract out support services. A furniture manufacturer would not purchase a fleet of trucks and hire drivers and support personnel just to provide its own distribution system. They hire companies that are experts at the task. The same concept applies when developing new software. Hire expert contract software developers.
  • Outsourcing provides you immediate access to the talent you need for prompt development and eliminates the need to invest in expensive but necessary hardware, software tools, and services required to get the job done. 
  • We already mentioned the challenges of working with overseas contractors, but there are other issues that affect all outsourced organizations. Communication skills are critical in the development of new software. Likewise, a compatible management style is required to establish a mutually acceptable work pace, clarity in documentation, and a progress reporting system. 

What's More Important?

Before you make a decision about in-house or outsourced software development, understand this. The digitalization of business is only going to expand becoming an essential component of whatever your business is. That means you will either have to invest the time and resources needed to develop a new core competency, or you can rely on a partner, like a furniture manufacturer who passed on buying a fleet of trucks in favor of contracting a distribution specialist firm and watched the business grow at a record pace.

That's the real question.

At Phoenix-based DHx Software, we believe that outsourcing allows you to focus on your core business while allowing you to enjoy the economies, efficiencies, and revenue-driving features that advanced software can provide. Offering a wide array of services and founded by leaders with extensive entrepreneurial and team-building experience, DHx provides the benefits of outsourcing while minimizing the risks.

Interested? Contact us today and let's chat about your software requirements. We look forward to meeting you.