It’s a question that’s been asked countless times by leadership teams about to start an enterprise software project: “Should we use an in-house or outsourced team?” The answer isn’t straightforward — there are advantages to both. What’s right for your organization will depend on your individual situation and needs. Use this guide to help you decide which is best for your upcoming project.
The Pros and Cons of In-House Development
An in-house team is the ultimate in convenience. If you have an IT team, why not use them for your software project? Maybe you should! Here’s what to consider.
Your In-House Team Knows Your Business
One of the biggest attractions of doing a project in-house is that your team already knows your business. They’ve had an inside view for as long as each team member has been with the company. They won’t have to spend time educating themselves about how your business operates.
On the flip side, this “curse of knowledge” could prevent your team from fully exploring the needs of each stakeholder to make sure they include the necessary functionality. If your team misses something important, they’ll have to go back and add it in. Changes almost always drive up cost. And if they involve integration with another software, the cost can increase significantly.
Your In-House Team Is Just Down the Hall
Your in-house team is also available to you 24/7 — or at least during all business hours. You can walk down the hall and ask for an update or share concerns.
This availability also has a downside, however. If your team is dedicating their time to an enterprise-level software project, they’re not going to have time to fulfill their normal job duties. Also, 24/7 availability makes it tempting to change the scope of the project. In-house developers’ salaries stay the same, so you won’t feel the pain immediately. But you’ll likely end up with a project that’s delayed as a result, and your team won’t be able to work on other important projects simultaneously.
Does Your In-House Team Have all the Necessary Skill Sets?
An enterprise software project requires a broad set of expertise. You need someone who can keep the project on track, someone who can manage the communication between all the team members and stakeholders, and someone who knows how to get the necessary input from stakeholders. You need someone who’s a professional graphic designer. You need a front-end developer and a back-end developer. You need someone to handle quality assurance. And you need a DevOps person and/or SysAdmin. Many companies just don’t have staff who can handle each of these areas well.
When to Choose In-House
Many leadership teams start off thinking about in-house teams while wearing rose-colored glasses. But once you take the glasses off and evaluate the potential of an in-house team objectively, you may find that it’s still the best choice for you. If you’re able to check all of the following boxes, you’ll want to consider an in-house team.
- You have other team members who can fulfill the job duties of those you’re pulling into the software project.
- You’re confident that the project won’t involve complex integrations that could derail your team mid-development.
- You commit to using a thorough discovery process to get input from all your stakeholders.
- Everyone agrees to a clearly-defined project scope.
- You have team members with all the skill sets you’ll need for the project.
The Pros and Cons of Outsourced Development
Skill sets — this is probably the most significant advantage of an outsourced team. With a top-quality outsourced team, you’ll have access to specialized expertise in each area. Another big advantage is cost. If you don’t already have team members available with the right skill sets, it’s more cost effective to “rent” them as an outsourced team than it is to hire them. Let’s dig into the details.
A Quality Outsourced Team Has Complete Expertise
While you do need to do your homework to choose a quality outsourced team, the best ones have a complete set of specialists available.
You’ll be able to rest easier knowing that there’s an experienced project manager who has an established, proven process. This person can complete the necessary research and ensure everything happens how it’s supposed to, when it’s supposed to.
You’ll have confidence that your end product will look professional and will be intuitive for each stakeholder to use. As a result, adoption will be easier. With a top-quality team, you won’t run into cost overages due to lack of adequate planning or an unforeseen need for more complex programming than you initially realized.
You’ll be sure that any bugs are immediately resolved. And you’ll have someone who knows how to deploy your new app, install the required tools on your server, and manage versioning for a smooth launch.
Not all outsourced teams are created equal, however. You’ll need to dedicate time and effort to finding a team with true experts and a track record of success. You should ask potential candidates how many projects they’ve completed, the types of projects they’ve done, and how many of their projects (where the scope wasn’t changed by the client) went over the initial budget.
An Outsourced Team is Typically More Cost-Effective
Unless you have specialists already on your payroll, you’ll almost always save money by outsourcing. The exception is if you’re planning to develop and launch new software solutions on a regular, ongoing basis. If you’ll be able to keep these specialists busy with work in their area of expertise, then it will be better to hire them internally. For short-term use, it makes more sense to “rent” than to “buy” talent.
When to Choose Outsourced
An outsourced team isn’t always the right decision, but it often is. If each of the following characterizes your company, you should probably choose an outsourced team:
- You don’t have specialists with the necessary skill sets on staff.
- You’re able to dedicate time to finding a high-quality outsourced team.
- You aren’t planning to develop new software on a continual basis.
It’s not an easy decision. But hopefully, at this point, the factors you should consider are a little clearer. While there’s no one right answer for everyone, most companies will find that one makes a lot more sense for them, based on the nature of the project and the makeup of the internal team.
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