In-House Product Development vs Outsourcing Software Development For Startups

When you have an idea or a clear vision for a product, it is difficult to resist starting to assemble an in-house product development team. But what you should start with instead is asking if doing so is worth it at the initial stage. This is why more and more companies are choosing outsourced development to reduce administrative costs, taxes, and lower the development costs for the product itself.

In-house product development

Pros

Internal expertise

  • Over the course of creating in-house developed software, the team members are left to fend for themselves and, as a result, make many mistakes.
  • Then, by the time the product is launched, the team is already it takes them much less time to improve the solution than before.

Quick bug fixes after release

  • A month after the release, when around 1000 users will have joined the app, bugs may become apparent. By that time, the outsourced development team can already be busy with another project.
  • When you already have an in-house development team after the software’s release, it is much easier to come running to them with the words our site is down and have the developers immediately get down to work.

Team engagement

  • Regardless of what some may say, there are more personal points of contact in an in-house team: corporate events, team building.
  • As a rule, an outsourced development contractor follows a pre-agreed plan and there is little room for initiative.

Transparent communication

  • Offline communication within an in-house software development team speaking your native language is simple and straightforward. If necessary, you can approach a colleague and quickly discuss any working points.

Cons

Flywheel acceleration is a matter of time

  • The term for bringing an end product to the market becomes longer. It takes time to collect and assign roles in an in-house development team.
  • Many stars should converge developer experience, competent project management, and team cohesion.

Hidden costs

  • It is not always possible to find IT specialists to fill all the roles in the team on your own.
  • Each employee should be given a laptop, a monitor, a desk, and a chair. Don’t forget about the office space where all of this can be comfortably placed, too.

Distractions

Offline communication for an in-house development team is smoother and more accessible, but it can be detrimental to productivity. Non business conversations often take place near the coffee machine.

Outsourcing software development

Pros

Reduced costs

It is generally cheaper to choose outsourced development than to find and hire a full-time in-house development team.

Quick start of work

  • Due to the fact that companies that offer outsourced development have a large variety of human resources, their specialists can start working immediately after the contract is signed.
  • If you’re short on time, finding an outsourced development team will be easier and faster than having in-house developed software.

Go beyond your local talent pool

  • If you are located in a small country, sometimes the whole national talent pool won’t have the exact specialist you require.
  • It can be easier to find an outsourced development team or certain specialists in another country than hiring people and having in-house developed software.

Cons

Communication problems

  • With remote collaboration, especially when you’re dealing with a large time difference, misunderstandings can occur, and they are bound to affect work.
  • For an effective outsourced development process, all appropriate communication channels and methods of collaboration must be established in a way that will guarantee a minimal number of potential inconveniences.

The risk of leaking important data

One more important thing is to make an NDA and a contract with clear rules about inner data and leakage risks for outsourced development.

Low price doesn’t equal high quality

  • when choosing an outsourced development specialist at a rate of $ 20 per hour, it is naive to expect a result of $ 50. You have to pay for a quality product.
  • In order not to get spaghetti code at the output, you need to contact companies starting from the middle of the price range or a little higher.

The stack may not be the best fit

  • An outsourced development specialist may not offer the most suitable tools, but those they have the most experience with
  • The stack does not mesh well with the required functionality, it’s good practice to talk about it on the shore and look for compromises.

Conclusion

There are a lot of aspects to think about when choosing between in-house software development and outsourcing. One of the most important criteria here is the company’s expertise.