Outsourcing Coding and Programming
With technology evolving constantly and the competition between online businesses increasingly drastically, businesses have to transform to stay ahead. However, businesses often don’t have the talent or resources to scale successfully. As a result, they often turn to outsource.
Outsourcing is when businesses use outside resources to complete certain tasks that are traditionally managed by internal staff and resources.
Processes or tasks that are typically outsourced by businesses include accounting, marketing, administrative tasks and software development. In recent years, many businesses have also turned to outsource coding tasks and programming. Let’s explore why this has become a trend.
Why Do Companies Outsource Coding?
Outsourcing coding tasks is increasingly common today, as businesses around the world turn to third-party outsourcing software development companies to deliver fundamental solutions. In fact, the global market size of outsourced services is currently worth $92.5 billion. But why do so many businesses turn to outsource coding in the digital age?
- Saving business costs. According to the Deloitte Global Outsourcing Survey 2020, this is often the biggest driver for businesses choosing to outsource coding. Outsourcing is a more cost-effective option for several reasons. Working with external teams means businesses pay for their services only, without the usual expenses associated with in-house staff, such as rent, software, training, and more. Another reason that coding outsourcing saves money is how much easier and more affordable sourcing talent is online compared to the cost of advertising a vacancy, doing interviews, onboarding, and training staff.
- Saving time. When outsourcing coding and programming to external teams, businesses don’t have to worry about lengthy processes of finding developers with diverse skillsets or years of experience. Businesses can instantly find specialists with the capabilities suited to the project at hand, and this saves a lot of valuable time.
- Greater flexibility. Flexibility becomes very simple with engineering outsourcing. When projects need extra expertise or more resources, work can simply be outsourced to a vendor. Businesses have the flexibility to address changes as they occur and take action to approach them with a fast turnaround.
- Freeing up company’s resources. When businesses outsource, they can free up different teams’ time by switching tasks to outsourced workers. This also means that resources such as hardware and software are more accessible because outsourced teams use their own.
- Access to tech talent. By using outsource computer programming tasks, businesses can get access to professional outsourcing providers with access to a large pool of outsourcing developers who have expertise in the latest technologies. Software solutions with the latest tech can promote the efficiency of different operations.
Common Pitfalls Related to Outsourcing Coding
Because businesses are not familiar with outsourcing and the processes involved, they may be prone to certain challenges and risks.
- Lack of control. When businesses outsource work to an external agency or freelancers, they often lose control of how those tasks are being managed, monitored and performed.
- Lack of communication. Whether businesses outsource overseas freelancers or some talented experts in the same city, important instructions are often lost in translation when communicating over the phone or online. This can cause a loss of serious time, money, and effort.
- Low quality of software. Some outsourcing programming companies and freelancers may be motivated purely by profit rather than quality work. This can mean that the work that comes back may lack the standard and quality that a business may have expected.
- Security issues. In the age of data protection, businesses need to take caution whenever using customer data. When businesses’ outsource processes that require personal data, they are placing the privacy of others or the security of their business at risk bypassing the data on to other people.
While these pitfalls can be very challenging for businesses and cause a loss of valuable time and money, they can easily be overcome with the right steps in place. The most important aspect to consider is choosing the right software engineering outsourcing model. The right model for a business is one that suits the company’s goals, structure, and unique processes. For example, a smaller company may benefit more from outsourcing to a country that offers more affordable rates, while a bigger company may want to invest in nearshore outsource solutions because the cultures between the countries are similar, and communication may be easier.
Which Tech Tasks Can Be Outsourced and Which Should Not?
Business owners face many tech-related challenges that can be a major cause for slowing down their business growth. Very few businesses can thrive in this digital economy without IT and digital strategy support. However, with limited in-house resources, many businesses must turn to outsource solutions.
Some tech tasks that can be outsourced include managing IT infrastructure, IT Support, cybersecurity, eCommerce development, application development outsourcing, web design and development, and customer relationship management (CRM).
However, there are always tasks that should rather be delegated to in-house staff. The reason for this is that these tasks are highly sensitive to a business and require excellent knowledge about a business’s needs and a high level of control. These tasks include tech research, customer service, account management, sales, and tech public relations.
To identify which tasks a business can and should outsource, an effective outsourcing strategy can be set up. During this stage, in-house resources should be identified and a detailed consulting session should be set up between the business and its chosen outsourcing vendor.
Outsourcing Success Stories
While the global outsourcing market has gone through many changes, the industry continues to perform strongly. In fact, the industry has been booming for more than 25 years. Some of the leading companies in the world wouldn’t be here today without their outsourcing efforts. Let’s explore some success stories.
Chinese e-commerce giant Alibaba used to outsource their IT development to the United States. The reason for this was because the skills and experience required to build such a large online marketplace back then were scarce in China. Their outsourcing approach helped Alibaba to innovate even with strict government restrictions and strong competition from eBay.
Long before WhatsApp was bought by Facebook, it was a small business with just a few employees. Back then, however, most of the tech work was done by developers from Russia. This helped the business to keep the costs significantly low. If they didn’t follow this approach many years ago, the popular chat app might not have grown as quickly or made as much money.
Cloud-based proprietary instant messaging platform Slack is known to outsource its design tasks to a web designing company. This included the web design, logo design and mobile app design. Their outsourcing efforts help them to save costs early on in their journey while allowing them the scale fast. Today, Slack is used by more than 10 million active users.
At the start of their journey, telecommunications giant Slack outsourced almost all of their software development tasks to European web developers. They claimed that they had a great product idea back then but no access to professional web development teams to execute the idea. As a result, software outsourcing worked so well for them, and their approach was such a success that it was eventually acquired by Microsoft.
Network of Arts (NoA)
Swiss startup Network of Arts (NoA) has been founded by young and ambitious people who had the vision to create an easy way of cooperation between viewers and artists. To discover the art, NoA presents interesting exhibitions for people to get to know the art. Because they are a startup, they didn’t require a large development team at the start. They were looking for a seasoned professional who could deliver excellent results. They approached the Ukrainian outsourcing company Mobilunity with their needs. They made use of a nearshoring solution with Mobilunity who offered top outsource programming services to help them grow their business and complete complex tasks. This allowed NoA to scale while saving valuable costs. The partnership was so successful, they commented about Mobilunity:
Success stories like this one show how access to talent just about anywhere in the world can lead to success.
How to Choose an Outsourcing Destination
Outsourcing is an important decision for businesses that have decided to have their projects completed by remote teams. This decision must be taken with proper care and preparation. Though the cost factor is often the most important consideration, several other factors must be kept in mind before choosing an outsourcing destination.
Among some of the most popular outsourcing destinations are Asia, Latin America, and Eastern Europe. Eastern Europe has recently become a new hot spot for specifically coding and programming outsourcing. Each country’s location, business culture, cost, tech capabilities, can be less or more suitable for different customers.
There are certain aspects to always consider when following an outsourcing approach and choosing a specific outsourcing vendor. Some of these include:
- Distance from a headquarters
The decision on how far away an outsourcing destination is from a business’ headquarters depends solely on the company’s needs. Some businesses choose destinations that are close to their country, and this is referred to as nearshoring. Businesses that choose nearshoring typically want the culture between in-house staff and remote workers to be as closely related as possible. Some businesses also choose nearshoring because they want face-to-face meetings to be possible every once in a while.
- Size of the talent pool available
Each outsourcing destination can be distinguished by the number of graduates that it offers every year and its specific areas of specialization. The more talent they have to offer, the bigger the change businesses have to find candidates with the right skills, knowledge and experience.
- Level of education and skills of local developers
Some countries spend a lot of capital on upskilling and educating young people in certain subjects. For example, Ukraine spends a lot of resources to educate its citizens in the field of information technology (IT). Businesses that are looking for workers that have specific skills or have significantly higher skills in a certain field compared to their in-house teams should research destinations that have specialized talent.
- Cultural similarity
When choosing the best outsourcing destination, businesses need to keep the cultural and linguistic discrepancies in mind, as they can have a major impact on how businesses work with remote teams. If businesses want to outsource to a distant country, they have to make sure that the destination’s workforce is multi-lingual and that the majority is fluent in English. When it comes to culture, businesses have to learn about the remote employees’ lifestyles and working practices to ensure a smooth partnership.
- Data protection rules
Keeping data secure is an important consideration for any business that wants to outsource tasks. To ensure a business’s data and that of its customers are kept safe, it is essential to choose an outsourcing destination that has certain rules and regulations for data protection in place. Some of the most secure regulations ensure that data is used fairly, lawfully and transparently, and only for specified, explicit purposes.
- English proficiency
Good language skills are necessary to communicate efficiently. Language skills can vary a lot between remote workers from different destinations and there can be great variation between their oral and written competencies.
- Cost of hiring
Destinations all over the world have different outsourcing rates. Some countries offer remote workers a high level of skill and experience at very costs, while others provide workers with a low level of skills at below-average costs. The secret is to find a balance between low costs and quality talent.
In recent years, Eastern European countries have been moving to the top of the list of countries to outsource to. This is due to a combination of a big talent pool of skilled and experienced workers with prices that are considerably lower than those in the UK and the US. Ukraine is one of the destinations that stand out because it provides a good price to quality ratio. As a result, the demand for IT outsourcing Ukraine has increased significantly in recent years.
Frequently Asked Questions About Outsourcing
Deciding to outsource is a big decision and it is important to do careful research. One way to identify all the most essential parts of outsourcing is to find the answers to key questions. Here, we answer a few frequently asked questions about outsourcing:
Q: What is programming outsourcing and how does it work?
Programming outsourcing involves using a third party to expand or enhance a business’ programming efforts. Rather than employing an exclusively in-house team, outsourcing enables business owners to hand over the management of certain tasks to an external company with professional expertise in the area. Businesses prefer entrusting projects or certain tasks to a third party to save valuable time and budget costs and commit more resources to other strategic business functions.
- Access to a large talent pool
- Access to skilled professionals who have experience in certain fields
- Lower hiring costs
- Saving time training in-house employees
- Freeing up time of in-house employees
- The opportunity to scale faster and more effectively
- More flexibility
- Loss of control over certain tasks for business owners and managers
- Lack of communication between businesses and remote workers
- Difficulty monitoring the quality of certain tasks
- Data security risks
- We recruit efficiently
- We help with onboarding
- We assist with ongoing support
Q: How to choose a country where to outsource?
Choosing the right outsourcing destination for a business is not something that should be taken lightly. This decision can transform a business’ future but can also lead to a business losing a lot of time and value if not executed correctly.
A successful outsourcing partnership requires seamless communication, long-term commitment, active involvement from all parties, and an excellent understanding of a business’ requirements and objectives.
Businesses that want to outsource must think of the quality of services as the most important ingredient when choosing an outsourcing destination. Businesses must make sure they decide upon a destination known for its high-quality standards and its reputation for offering top professionals.
Other factors that play a role in choosing an outsourcing destination include linguistic and cultural differences, as well as data security and privacy policies. A good combination of all these factors makes for a great outsourcing destination.
Q: What are the pros and cons of coding outsourcing?
When done right, outsourced software development can create powerful benefits for businesses, freeing up employees to do what they do best while producing high-quality solutions that streamline operations and offer businesses the edge they require to stand out among competitors. But there are also some pitfalls and drawbacks to outsourcing. Let’s take a look at some of the pros and cons of coding outsourcing:
Although these are certain downfalls of outsourcing, these can easily be avoided by choosing the right outsourcing destination and the right vendor.
Q: What are examples of companies outsourcing software development?
Outsourcing is not just about big corporations trying to find the most affordable labor, it includes new startups and small and medium-sized businesses in every industry trying to obtain a variety of business goals.
Businesses often choose an outsourcing approach to scale. An example of this is Slack. Back in 2012, the founder had an idea but didn’t have the resources to make his vision a reality. He then worked with an outsourcing firm to design the mobile and web apps, and create Slack’s branding as we know it today.
Limited resources is another major reason why businesses outsource. GitHub’s founders realized at the start that their solution needed people proficient in Git itself. The specialist was found and was employed as an outsource presence behind the project. This allowed GitHub to be as perfect for Git as it could be.
Q: How to choose an outsourcing software development company?
The best approach to finding the right outsourcing software development company is not picking blindly. Instead, businesses have to spend a lot of time doing proper and careful research. During this stage, a business should look at an outsourcing company’s website and reviews from previous clients.
Once a shortlist of possible vendors has been identified, it is important to contact each of them to confirm the cost, availability, area of specialization and more. Thereafter, several face-to-face meetings can be held to discuss specific needs, formulate solutions and identify possible challenges.
Mobilunity as a Reliable Vendor in Ukraine
Based in Ukraine, Mobilunity is an outstaffing company with over 10 years of experience. We specialize in matching coding experts and programmers with clients around the world. We aim to help businesses succeed through the help of professional workers offering the right knowledge and skills.
Our effective approach to working with clients makes us stand out among competitors. Some of the most leading businesses in the world trust our process, including XPLG in Israel, Paidy in Japan, BYG-E in Denmark, and Network of Arts in Switzerland.
We always aim to improve and expand the operations of businesses worldwide. To do this, we follow the effective process below:
Our team specializes in selecting the best candidates according to clients’ briefs. We then allow them to complete a test task and pass a range of interview questions.
We assist with the setting up of important settings and processes to ensure effortless onboarding for resources.
Our team ensures all contractual commitments are met and offers support with ongoing needs and wants to ensure a successful overall partnership.
If your business is looking for outsourcing coding solutions, you are welcome to contact the Mobilunity specialists. Get the expert help you need effortlessly!
All salaries and prices mentioned within the article are approximate NET numbers based on the research done by our in-house Recruitment Team. Please use these numbers as a guide for comparison purposes only and feel free to use the contact form to inquire on the specific cost of the talent according to your vacancy requirements and chosen model of engagement.