3 Things to Know About Outsourcingblog Roman Piluta March 30, 2020
Software development is not simple. It is also not completed when a single project is finished. Rather, it is an ongoing process where companies need to regularly update and iterate on projects. These changes could be due to changing corporate environments or even legislation. Regardless of the cause, development is ongoing. Companies involved in software development, either internally or for resell have a quandary. Simply put, they cannot deal with all of the work themselves. The software market is developing and changing rapidly. This is due to increased competition and also changes in technology. Added to this, is the scarcity of technical specialists themselves. In some cases, finding the right talent can take up to 6 months or even longer. Hiring is a long, difficult and convoluted process. If you consider that after a resource is hired, they also need to be trained then the time is extended even more. You’ll realize that in some cases, companies could wait for a year or more before they get value from a resource. With increased competition, this timeframe is unacceptable. Alternative options need to be considered. This is where outsourcing comes into play. Many of the largest tech companies like Google or Amazon utilize outsourced resources, but not all companies know how to do it right.
Options Available When Outsourcing
There are several different outsourcing options available for companies to explore. There are pros and cons to each one that we will investigate in more detail below.
Local Consultants and Contractors
As the name states, this type of outsourcing is generally in the same geography as the company. In many cases, local consultants are able to work from a companies corporate office. This can be a significant pro as they can act as members of your own team. Sadly, this is also a con as while they are in your office, they are often an extra load on management.
Offshore Development Center
The advantage of the off-shore teams is their cost-effectiveness. They are generally quite highly skilled and available at a fraction of the cost of local resources. Unfortunately, while their skills might be high, they do not often have experience working in teams. This can extend the launch process significantly, delaying their usefulness. Another negative of this model is the extra management overhead required.
There are quite a few pros with a TaaS Vendor like NIX. The biggest is that you are working with a team. This team has experience working together and is able to start work quickly. Another big advantage is that you are not restricted to a specific skillset. TaaS vendors provide you industry and technical knowledge across many different areas. With a large pool of talent in a TaaS team, you can start quickly. Working with a TaaS vendor is different however. It’s not the same as local consultants or offshore teams. Also, the benefits to TaaS vendors do cost more than offshore teams which need to be understood.
What Can You Outsource?
Almost anything can be outsourced. From small tasks to end-to-end product development and everything in between. When you consider the size of IT, you’ll quickly realize that having one person with all of the skills is difficult. In fact, when you think about it from just three simple criteria:
- Hardware (network, desktop, and server),
- Software (Windows, Unix, Mac, Linux), and
- Programming (too many languages to name)
you’ll realize that one person with all of the skills is impossible. When you add in cloud, security, and process it becomes an even larger impossibility. Companies understand this and regularly look to partners to help with their IT needs.
Many organizations have IT, teams. These teams often have specific skills but are simply unable to cover all of the different requirements in modern businesses. This is especially the case in small and mid-size organizations. Here, the IT function might cover the internal infrastructure, hardware and software but not development or interconnectivity. In addition, when you consider that some jobs are only needed on an ad-hoc basis having a dedicated resource or team idle doesn’t make sense. Having a partner that is available to complement your teams’ internal skills makes good sense. There are obvious cost benefits to this strategy. There are also benefits from a skills point of view. It’s important to realize that IT teams lose familiarity with the technologies if they are not regularly used.
Level 1 Requirements
Support and operations is a complex job. People that get into it do it for the challenge. Troubleshooting difficult issues are something they enjoy. By contrast, having to reset a password for the tenth time that day, is demotivating. In addition, it wastes the skills and knowledge they have spent time and money earning. Simple level 1 issues can easily be outsourced to a partner. Training outsourced teams to handle these types of issues is not difficult. Once done, your internal team can work on more complex and enjoyable issues. The tasks that are actually of interest. This has two benefits. Firstly it keeps your team motivated but secondly, it results in a faster response and resolution time which is something clients enjoy.
Outsourcing IT Entirely
Companies have learned that specialization makes sense. For small and mid-size businesses, it is simply impossible to do everything. The budget does not exist and finding the right resources can take a significant amount of time. For these organizations and larger ones, outsourcing the entire IT function makes sense. It lets companies focus on what they do best. It also ensures that the right resources are available when needed without having to pay salaries and benefits for no reason.
Outsourcing is not all positive. There are some risks that companies need to acknowledge before they choose a partner. Some of these risks include security implications as based on the outsourcer location data security could be an issue. Rules and regulations vary from country to country. The outsourcer needs to comply with all applicable laws for the country their client is in, otherwise, penalties could be applied. In addition to security, another area of concern is trust. Projects can only be completed if both parties fully understand the objectives, goals, and customers of the other. Companies need to share detailed information and they want to ensure that this will not be misused. Companies that outsource activities also want to trust their partner has the right skills to do the job. By selecting the right partner, many of these risks can be alleviated and avoided.
The right TaaS vendor can become a reliable partner for years. Having a company like NIX in your corner will ensure that you have a team of people available to you. This team can shrink and expand to your changing requirements. NIX project managers and leaders can examine your business goals and needs. They can build a technical and managerial plan to ensure your goals are met and exceeded. NIX has been doing exactly this for 25+ years for clients like ARTiFACTS, Humaneyes, Cengage, and others. Let us do the same for you.