In-House Development vs.Software Outsourcing

Working with in house team or hiring outsourcing team  – which choice will be more suitable? How about we get into the low down of everyone here!

Table of Content

  1. Introduction
  2. Building an In-house Software Team While Conducting App Development
  3. How Could This be Helpful in the Software Industry? Time to Unveil Some Crucial Resources
  4. There are Cons too!
  5. Coming to Outsourcing Software Development Companies
  6. Types of Outsourcing
  7. How is this Beneficial for Developers as Well as Businesses?
  8. It’s Decision-making Time! – In-House Development vs Software Outsourcing
  9. Roles that Can be Outsourced!
  10. Conclusion

1. Introduction

Since you are reading the article, I assume that you are in a dilemma of whether to choose a software product or outsource one. However, you aren’t only the one! Many of you do have to make a tough choice between in-house vs outsourcing software development, especially when building a software product.

It’s high time we admit by being realistic here. Gone are the days when everything was about choosing between right or wrong. Today it’s more about choosing between what is right and what is easy, in-house development vs software outsource.  In any case, amazingly, every one of those decisions makes picking more challenging than any other time. And the interesting part is, what should be possible is to comprehend what you need as opposed to endeavoring to sort and channel all the decisions on offer.

Hiring or outsourcing team  – which choice will be more suitable? How about we get into the low down of everyone here!

2. Building an In-House Software Team While Conducting App Development

By leveraging company resources, businesses can develop as well as implement software right in accordance with their needs and requirements. Right from time to money, energy, the entire process of in-house software development requires everything in bulk. For starters, one requires to get involved in the entire job scenario, i.e. from conducting initial interviews to hiring suitable ones as well as posting them right on time. These aspects work for creating a solid base when developing good software.

Moreover, the in-house development team has always been in favor of CEOs. After all, who doesn’t want to have their team of employees and assign projects respectively? The first and foremost statement favoring the concept is you can gather people and bring them under your circle of trust who share the same view and psychology making a more balanced environment around. In-house software development is more sensible for those businesses with main projects and day-to-day activities.

Your in-house team is the center of your organization. In case you’re a leading software development company or an IT organization, you need to discover genuine diamonds to succeed.

3. How Could This be Helpful in the Software Industry? Time to Unveil Some Crucial Resources

  • Direct Access to Employees – Having an in-house team of designers and developers implies you know the capacities of each colleague and can relegate them to software-based assignments appropriately. In any case, if you have an issue you will know who caused it and things can be resolved as soon as possible. You don’t need to wait any longer because all the urgent tasks and fixes can be prioritized and taken care of.
  • Personal Involvement – Psychologically speaking, unlike outsourcing the in-house team of software developers do convey a feeling of association and commitment in the organization’s services. Developing new products via implementing emerging technologies would be no big deal for them. And maybe that’s the reason why one finds these programmers passionate, loyal and productive.
  • Experience and Expertise –  Complying with requirements here is way easier. I mean one no longer requires to spend hours explaining to contractors what you have done to date and whatnot. Your team’s position, ethics, philosophy in the development market says it all about you when working on a software project.

4. There are Cons too! 

  • You Might Have to Pay a Hefty Price! –  Again unlike outsourcing, this point turns out to be a severe headache for several businesses – employees on the payroll. Regardless of what the result is if they can accomplish, you need to pay them. It doesn’t matter whether you are asking for some major changes or some minor ones, you have to pay the same salary.  Above all, there are times when you don’t have a project at the moment, still you have to pay for them for your development project.
  • Team Management – Managing a team of skilled software developers is not everyone’s cup of tea. Also, discovering individuals who will make a drawn-out obligation to your organization and on-boarding them may appear to be an endless interaction. A development project requires appropriate team management and that’s why it is high on-demand.

5. Coming to Outsourcing Software Development Companies

Whether to outsource software or not to? That’s the question! With every business having an irresistible appetite for gaining competitive advantages by using innovative approaches. The business strategy started in 1989 where Kodak was one of the first names to outsource information technology and now the ITO and BPO industry seems to dominate.

“For everything, we don’t like to do, there’s someone out there who’s good, wants to do it”  – Josh Kaufman

Technically speaking it involves a highly experienced team offering everything from delegating certain tasks to projects, procedures to external entities, etc. However, the process of outsourcing has a wide range of hassle mostly due to unwanted diligence. But once you get to understand the company culture, experience, their way of working and you are sorted. You know what is the best part here in software outsourcing? As soon as you find the relevant software outsourcing company, nothing can stop you from succeeding.

Henry Ford says that If there is something we can’t do more efficiently, cheaper and better than our competition, there is no sense in doing it and we should employ someone to do the better work for us. The industrialist understood the significance of outsourcing that when done right it can be used for the greater good. And since we are talking about outsourced software, the pattern of delegating tasks, projects or processes to external entities is a clear win-win.

6. Types of Outsourcing

1. Offshoring

Offshoring involves the relocation of certain business units or processes beyond the borders of the country in which the company is located (offshore). Mainly used to conduct repetitive tasks such as that do not involve the expert team assigned specifically to a certain project. Whether you are offshoring vital projects or transfer departments, the software can be developed in a smooth venture. Find out the best Software development countries in Asia if you’re looking to offshoring.

The only challenge here involves struggling with cultural differences, different time zones and language barriers while dealing with their software development team.

2. Nearshoring

This concept involves subcontracting projects or processes that are located outside the country but in the same region. For example, a German company undertaking nearshoring will be interested in Central and Eastern Europe, which is cost-effective but there are no common drawbacks of offshoring, such as different time zones, big distances and significant cultural differences Whenever there is a need for a meeting in person, flights from one European country to another are fast and low-cost.

Also, there is a similar legal environment. Nearshoring team is recommended for complex and innovative projects that require specialized skills and a dedicated team that works closely with the clients and their co-workers.

Let’s talk about certain benefits of outsourcing a software development company.

7. How is This Beneficial for Developers as Well as Businesses?

  • Top Talents at Your Fingertips – Unlike in-house, choosing an outsourcing service provider gives you the liberty to reach wherever you want to irrespective of your geographical location. This means you have an ocean of talent pool lying in front of you to choose from. The best part is here in the development space is you get an opportunity to select from destinations that offer reasonable prices and quality.
  • Streamlined Development and Effective Problem-solving –  Jumping in today’s bandwagon whether it’s in-house or choosing a software outsourcing company mean you have plugged into an already well-established venture where procedures are more refined. Now, what is the deal-breaker here in the development space? Most of the team of outsourcing providers have a rich experience in handling development challenges due to their wide range of projects they had a chance to participate in. Plus, they have an immense amount of access to the knowledge and skills accumulated within the company.
  • Priority Tasks are Taken Care of Without Much Hassle – Yes, stick to your main objective! Do what you are best at and keep doing that way! Also, while your software is being developed you will be able to manage several tasks and failures more calmly. Partnering with the right professionals in the development space can give you plenty of time on your hands.

8. It’s Decision-making Time! – In-House Development vs Software Outsourcing

Finally, you must be waiting for the final verdict. Which one to go for your software project in-house development vs Software outsourcing.

Factors In-House Development Software Outsourcing Development
Costs High Low
Expertise Narrow Extensive Expertise
Quality High High
Management Well-established and Seamless process Less Manageable
Speed Low High

The straightforward answer is that it depends on your development project! Budget, Timeline, Project Scope are the three main factors worth taking into consideration while making a decision. Let me elaborate so that you get a clear idea about what exactly I am talking about of course in regards to the software industry.

Situation #1 Imagine you are planning to develop a grocery shopping app since you own a grocery store. So as a business person, you will simply focus on that. If you have enough time and money to spend, consider an in-house team for development. Full-time assistance is something you will need or else simply outsource software.

Situation #2 Now, let’s say you are considering looking for an inventory/warehouse management software to streamline and automate all the business procedures. Now since your business is not entirely dependent on this and in case, if the software is developed you may not require maintenance on a daily basis. So in such cases opting for a reliable software outsourcing company might work wonders.

9. Roles That Can be Outsourced!

So now you are well-aware regarding all the advantages and disadvantages of outsourcing software development, it’s time to move on further with what responsibilities you can pass on to your software outsourcing partner.

1. IT Engineering Roles

In the battle of in-house development vs software outsourcing, the engineering services costs make a difference.

2. Customer Support Services

If you are a small or midsize business considering in-house or outsourced services, remember this: it makes more sense to cooperate with an offshore support team in the country where your clients are based. Such a support team will be a lot better at meeting the needs and answering the questions of the clients living in the same region.

3. Marketing responsibilities

An experienced marketing company can promote your development project in a better way than an in-house IT team can. The outsourcing development team can include multiple specialists who will develop an app or a powerful marketing and advertising campaign for your product.

10. Conclusion

Again I would say there is no high contrast, There are consistently advantages and disadvantages on the two sides. According to Deloitte’s 2020 Global Outsourcing Survey, outsourcing is expected to grow, particularly in Finance, HR, and IT.

So what are you waiting for? Time to choose a reliable offshore software development company like TatvaSoft that suits your development project to a great extent.

Itesh Sharma

Itesh Sharma is core member of Sales Department at TatvaSoft. He has got more than 6 years of experience in handling the task related to Customer Management and Project Management. Apart from his profession he also has keen interest in sharing the insight on different methodologies of software development.


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    1. Issac

      Whenever companies decide to develop software applications they face problems in taking decisions whether they develop in-house or hire outsourcing partners. This article discusses all aspects which we need to consider while comparing in-house and outsourcing.

    2. Hania

      Article gives the complete difference between in-house development and software outsourcing. We can refer to this article to consider different factors while making selection between them. But I think Onshoring also can be included in this article.