The Ultimate Guide to Hiring a Software Development Company
Companies are under constant pressure to keep up with the most recent tech trends and customer demands for upgrades and bug fixes. They can’t afford to try and meet those demands if they don’t have sufficient resources in-house.
That is why many companies decide to outsource software development.
While outsourcing the tech part of your business to a software development company might feel like losing control over the final product, at InData Labs we are sure that the pros by far outweigh the cons. Primarily, because you will get a dedicated software development team for your projects that is specialized in your area of work.
Outsourcing can be daunting. So, let’s go over some of the most important aspects of how to hire a development team for any future tech projects.
Should you hire an offshore development center
If outsourcing a tech project was as simple as answering this question, many more companies would hire software developers outside of their company in the blink of an eye.
However, it is more complex than that. Before you even start looking, you need to understand the nature of your project. That is vital to picking the right partner out of all software development companies for hire that exists today.
Your choice shouldn’t be influenced by well-designed presentation decks and promising sales pitches. It should be driven by tangible facts that are closely related to your project and the way your company operates.
Here are some important questions to answer internally before you even start looking for potential companies to hire:
- Will the end product be execution-focused, user focus, or customer-focused? This will determine the complexity and therefore the price and risk for your project. Customer-focused apps tend to be more complex, while execution-focused are typically easier to build as they have a smaller user base.
- What is your budget, and what are the desired features for the final product? Unfortunately, there will always be a tradeoff between money and product features. But deciding what is non-negotiable and what is nice to have will help you make those tradeoffs a little bit easier.
- What lever of control and supervision do you want or need to have? Outsourcing can be done in four different ways, all depending on how much your team wants to be involved – onshore, nearshore, offshore, and hybrid. All four types have advantages and disadvantages. For example, onshore outsourcing (outsourcing to a company in your country) is typically more expensive, but there are rarely any communication problems. Offshore development centers, on the other hand, offer the most cost-effective solution but this model requires more supervision. Hiring software developers with offshore development centers suits best for a hybrid outsourcing approach where your company is actively involved in the day-to-day progress of the project, rather than do bi-weekly checks. In recent years, hiring nearshore software development teams have become quite popular because they often operate in the same or neighboring time zone as you, and there are minimal cultural differences.
What to look for in a software development company
When you are ready to look at potential software development companies to work with, there are a number of things to look at.
It goes without saying that you need to take a company with good customer references and some track record to show for. However, don’t confuse longevity with excellence. There are a lot of newer software development firms on the market started by dedicated engineers who are more forward-thinking and more innovative than their competitors that have been in business for longer.
Apart from that, there are a few non-negotiable factors that we believe you should look for in the software company you hire.
They should have relevant experience
Software development services aren’t just about writing code. It’s also about understanding what is the best fit for your industry and situation. They should know the most appropriate coding language and the best database management solutions for your project, how to execute good UX design and QA, or even when your project could see improvement with AI software development.
All these aspects will vary a lot depending on if you are a fintech company building a consumer app, or if you are in the medical field making a solution for government-run facilities.
If you can’t find the exact match, look for a dedicated development team that has broad experience in different industries. This shows that they are adaptable and most likely hold a sizable portfolio of transferable knowledge and skills.
In fact, software development companies with more universal experience can be a better choice in some instances. They tend to have more versatile development teams, which can be an asset if you are not 100% sure what features and tech your software project needs. A more versatile team can play the roles of advisors as well as executioners.
You should be able to trust them
One thing that is true about most software projects is unpredictability. You can mitigate it to a degree with proper planning but there is no way to eradicate it. That is why trust is an important factor in the relationship you have with the software development firm you hire.
You need to trust that the company you’ve hired understands your business requirements, and can communicate well with all stakeholders when issues arise (because they will).
There are some questions to ask the software development companies you are talking to in order to gauge your compatibility:
- What are their company values? Also, when looking through their portfolio and hearing about their way of working, try to understand if they actually work by their values.
- How have they handled unexpected things in the past? What did they do when a vital team member went on parental leave? How did they communicate with the customer when it became clear that a product concept wasn’t working?
- How did they handle conversations about going over budgets, or changing financial priorities?
These questions are more universal. But since software development is a complex field, your company might need to ask some additional questions. For example, if you are in an industry where security is important, you might want to include what security measures they take, and how they’ve handled confidential projects in the past.
What to discuss with your dedicated team
Once you’ve made your choice, congratulations! Now starts the work of figuring out the details of the project together with your software development company. This is the time to set the expectations for the work ahead.
Here are some important aspects to think about in this initial stage.
It’s not only about money (but it’s important)
As we’ve already mentioned, software projects can be unpredictable, which results in many software projects running over budget by as much as 50%. With an average cost of a software project anywhere between $10,000 and $100,000, this can mean an additional cost of $5,000 to $50,000.
Naturally, the price should be a topic on the table. You should agree if the project will be charged based on software engineer hourly rates or a fixed price. With a fixed price, it’s important to decide on the scope of what the fixed price covers and what it doesn’t. Regardless of what you choose, outsourcing software development is going to be more affordable than if you hire software engineers in-house.
Don’t chase the cheapest price. First of all, any good software development company will price their services based on the value they create for you, the level of uncertainty they have to work with, as well as the talent they offer. In other words, the price includes much more than one software engineer writing code.
Remember, the cheapest initial offer is rarely the cheapest option in the long run. Poorly written code, insufficient testing, lack of understanding of the industry – all of that and more results in so-called technological debt that will result in additional costs in the future.
Frequent communication and close collaboration is necessary
Open lines of communication are vital for the success of your software project. Both sides must convey their thoughts and ideas properly and regularly. And for that, it’s important to facilitate a space where everybody feels safe to speak up. That applied to both you and the software development firm you are working with.
It could be beneficial to dedicate a bit of time in the beginning to set the grounds for a good relationship between all teams. This will create social bonds as well as professional ones, which increases chances for exchanging creative solutions and ideas.
Make sure your companies are using the same tools and methodologies
This point is a partial extension of the discussion we had earlier about company values. We concluded that companies with similar values have a higher chance of successful cooperation. The same can be said about tools and methodologies.
These days, most companies in software development use a form of SCRUM or agile development process. However, there are some that still don’t. If agile is the process your company follows, it will take precious time away from your project to get the software development company you work with onboard for daily standups, sprints, etc.
When it comes to tools, there the rules are a bit less strict. When it comes to project management tools such as Asana, Trello, or Jira, it helps if your partner firm uses it but it’s rarely a significant obstacle if they don’t. These tools are very intuitive and can be learned daily quickly.
If your partner firm, on the other hand, has very different processes for their backend of frontend work than that you need, it’s wise to agree on some common tools both sides can use.
Finding the perfect match for a partner firm for a software development project can be tough. But if your company does a thorough job to understand the complexity and scope of your project, and asks the right questions when talking to potential partner firms, you have a bigger chance of succeeding. Remember that trust and good communication will greatly strengthen any professional relationship.