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Guide To Outsourcing Software Development

Software outsourcing takes place when companies choose to have custom software solutions developed by a third party. Outsourcing software development has many advantages such as cost reduction, improved efficiency, mitigated risk, and enhanced security.

In today’s largely digitized business landscape, companies have the ability to access the world’s top software developers. More and more established companies and startups alike are outsourcing to accelerate their development.

However, that’s just the beginning. Let’s take a better look at what software development outsourcing is and how it can benefit your business.

Software Outsourcing as a Global Strategy

Software development is a bit like a game of musical chairs. With every new tune, the chairs shuffle and you need to think fast to keep up. Languages come and go, methodologies sprout up like mushrooms, and what was standard yesterday is ancient history today. That's why companies are turning to global software outsourcing, to stay ahead of the curve and keep their business in the game!

As a fast-growing tech outsourcing company in Southeast Asia, at Krenovator we strive to drive the software development industry forward. High-quality outsourcing services like the ones we provide are allowing companies from all over the world to instantly fill any skill gaps in their teams, setting them for digital acceleration in the long term.

Nowadays, software outsourcing providers are seen as valuable business partners who can play a major role in growth. Specialized development areas like blockchain, cloud computing, and the Internet of Things are no longer a challenge for small and medium-sized businesses that don’t have an in-house development team. Even large enterprises have adopted software outsourcing as a global strategy.

The Benefits of Software Outsourcing

There are many benefits to outsourcing software development, including:

Accessing Global Expertise

At Krenovator, we work with the Top 1% of Tech Talent from Malaysia & Indonesia. Access a diverse tech talent pool that you cannot get from near-shore or in-house.

Complementing Existing Infrastructure

Outsourcing development helps companies achieve their vision by outsourcing skills they are lacking in-house.

Faster Turnaround

Outsourcing can speed up the software development process without compromising on quality. Working with experienced developers who understand the principles of your project can accelerate your product’s time to market.

Reducing Costs

Outsourcing allows companies to focus on their core business functions and direct their time and resources towards solving capacity issues. This is a great way to increase cost-efficiency.


When you outsource a software project, you only pay for the expertise that you need. It eases pressure on internal staff and frees up company time to focus on the day-to-day running of the business.

Reduced Risk

A software outsourcing company can help mitigate the risks of developing your project. An experienced team will be able to foresee potential liabilities and identify errors through robust testing and QA practices.

Responsibilities Are Met

An experienced outsourcing team will have robust workflow processes in place to ensure that progress is monitored, milestones are met and projects are completed on time.

At Krenovator, we carry out feasibility studies as part of our outsourcing process to provide technological and budget validation. We provide proof of concept, develop prototypes, and implement quality assurance testing to minimize the risks early in the product development cycle.

How Does Software Engineering Outsourcing Work?

Outsourcing software engineering is a complex endeavor with many associated challenges and pitfalls.

However, you can really succeed at it with the help of a quality software engineering partner and a tight process to guide you. And while that process might differ from company to company and industry to industry, we can sum it up in 5 key steps that determine how it all works.

Project definition

The first step consists in defining the objectives and scope of the project at hand. Here, you establish what you want to build, how much you can spend on its construction, the goals you hope to achieve, and the overall timeline. You need to do all this before even thinking about outsourcing, mainly because you need a complete understanding of your project to decide which type of outsourcing engagement you’ll need.

Outsourcing research

Armed with your project details, you can now go out and research the available outsourcing companies that might complete your project successfully. This means you’ll need to search for appropriate companies with the expertise and industry experience your project requires. This is an exhaustive process that will have you shortlisting outsourcing companies, understanding their services and models, and evaluating their quality, experience, reputation, and processes.

Project start

Once you have picked the outsourcing company that better fits your needs, it’s time to kickstart your project. In other words, you need to meet with the outsourcing team, explain your goals, and devise the roadmap ahead. It’s of extreme importance that you define your involvement in this step so you know exactly what to expect moving forward.

Software engineering

When the strategic plan is in place, the outsourcing team can start working on the software engineering process itself. Depending on the engagement model you’ve committed to, this can mean different things:

  • Start work with your in-house team aided by the outsourcing professionals

  • Outsource the part of the project you need the outsourcing company to do

  • Outsource the entire project for the outsourcing company to work on

Which option you end up going with will depend on your own requirements. You might go with staff augmentation to bridge your team’s skill gaps, outsource a part of it that falls outside your team’s capabilities, or outsource the entire project to have the ability to focus on other, most pressing activities.

Project completion and beyond

The outsourcing team will follow the agreed map and provide the deliverables according to the predefined timeline. Naturally, this process will have numerous changes and adjustments based on your feedback. The logical conclusion is having the software ready but that doesn’t necessarily mean the process ends there. Depending on the type of project, the outsourcing partnership may go on to provide maintenance, updates, and further development.

The 3 Main Models of Software Outsourcing

There are 3 principal software outsourcing models that companies can choose from. Each model has its own advantages. The outsourcing model that suits your project will depend on its level of complexity, your budget, timescale, and level of involvement.

The simplest form of software outsourcing is the staff augmentation model, where an outsourced team works alongside your internal team to develop the software.

The dedicated team model presents outsourced talent which has more responsibility for overseeing the project. Our Delivery Teams thus provide management structure, allocating specific tasks and monitoring workflow. In this way, you benefit from the expertise of highly-skilled developers who provide a specific service.

With a project-based model, the outsourcing company oversees the entire software development process, from defining the specification to allocating workflow, setting timescales, and quality testing.

Are you in need of software developers to help accelerate your IT project? Talk with our expert IT consultant regarding your requirements.



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