In this fast-changing area where certainty is a rare thing, we decided that we should equip you with the essential knowledge to effectively handle IT resource allocation and expenditure.
Cost and Right-Sizing Flexibility
Presently, IT leaders are directing their attention towards expense reduction and optimizing their resources. They are actively seeking flexibility in managing costs and staffing levels. Outsourcing is emerging as the solution that provides them with the necessary control in the midst of substantial business unpredictability.
Outsourcing has reverted to its fundamental role as a means to save costs and enhance flexibility. Software outsourcing has clearly demonstrated its value in effectively navigating economic fluctuations, corporate uncertainties, and budget constraints while maintaining agility.
Get 40% to 70% reduction in development costs to better control expenses and budget.
Gain the specialists and skills needed for your projects along with the adaptability to quickly adjust through staff augmentation and managed project outsourcing. Finding affordable tech talent to drive ongoing digital transformation efforts will be the best practice here.
High Demand and Perceived Shortage of Qualified Individuals
Breaking the cycle of declining recruitment and staff retention is made possible by tapping into highly skilled developers located in different regions.
Additionally, outsourcing helps in mitigating developer turnover. In the event that a team member departs, your software outsourcing partner takes on the responsibility of swiftly replacing them at no additional cost to your organization. This saves you of the load of recruitment efforts and the associated expenses of hiring IT recruiters.
By leveraging outsourcing, you can promptly access the specialized technical expertise required to initiate your projects more swiftly.
Outsourcing has been tried and tested as an effective solution for addressing talent shortages. It helps you to harness the urgently needed skills on flexible terms while benefiting from cost savings, especially when partnering with firms located in the world's prominent outsourcing hubs.
Focus on Specialized Tech Skills
The shortage of tech talent is particularly pronounced in highly specialized development roles, with the most overwhelming challenges arising in areas linked to dynamic and rapidly evolving technologies such as cybersecurity, cloud computing, and artificial intelligence.
In today's swiftly expanding tech landscape, IT leaders are encountering difficulties in maintaining a comprehensive roster of essential skills while adhering to budget constraints.
Given the considerable expense and time associated with building in-house expertise or upskilling existing staff, an increasingly popular solution for IT leaders is turning to software development outsourcing to proficient partners. This strategic shift allows them to:
- Incorporate domain expertise specific to technology and functions with remarkable speed, surpassing the timelines of in-house recruitment or upskilling efforts.
- Gain access to top-tier teams that are already well-versed in the most cutting-edge specialized skills.
- Realize cost savings by enlisting specialized offshore development teams, offering comparable quality to expensive U.S.-based talent but at a more budget-friendly rate.
Cybersecurity Awareness
Growing security technologies have been devised to prevent the rising volume and complexity of cyberattacks, increasing the demand for cybersecurity expertise, which is already in short supply.
A growing number of IT leaders are turning to external teams as a means of extending their defenses. This approach allows them to:
- Onboard dedicated security specialists as needed, around the clock.
- Secure the services of experienced and credentialed resources at cost-effective rates.
- Remain up-to-date with industry-leading security practices as technologies and systems evolve.
- Ensure compliance with the latest security standards and controls.
The involvement of an experienced advisor can have a significant impact on establishing a good security capability. Accelerance's security practice, for instance, offers a range of services beginning with a comprehensive risk assessment to identify vulnerabilities.
It then offers a proactive remediation plan to address any shortcomings, ultimately transferring operational skills within the organization.
Consideration of Multi-Partner Relations
These arrangements can take on different forms, ranging from outsourcing software development to partners in multiple countries or to multiple partners located within a single region.
They furnish the capacity to adapt skills acquisition across optimal locations by employing a blend of nearshoring, offshoring, and onshoring strategies as regional circumstances evolve.
They provide IT leaders with the opportunity to access cost-effective rates for routine development tasks while also engaging more advanced partners for specialized programming projects.
Multi-partner sourcing represents a response to a common query posed by our clients: "How can I enhance the benefits of outsourcing even further?" It stands as an appealing choice, particularly for those who have previously explored outsourcing and now seek to elevate their outsourcing initiatives to a higher level.
Key Cost Factors
Location
Particular regions establish a reputation for their specialized skills, which creates an increased demand and thereafter leads to an increase in prices. Moreover, regions with nearshore proximity and overlapping workdays tend to experience elevated pricing. Rates also tend to be somewhat higher in countries located in close proximity to a first-world economy.
Experience
As an expert's level of seniority increases, it's probable that their cost will also rise. Nevertheless, this investment brings with it the advantages of choosing experienced professionals. It's important to note that expert rates can vary, even within a single region, depending on an individual's experience and skill level.
Demanded Skills
Given the shortage of desirable tech skills, be prepared to experience an additional cost for cutting-edge or exceptionally specialized expertise. Regardless of the location, skills like architecture, DevOps, AI, and data science will demand higher rates compared to more foundational development skills.
Language Proficiency
Challenges in language comprehension raise the probability of errors and misunderstandings, leading to project delays, second-rate results, and the potential need for revisions, which can lead to extra costs. It's advisable to seek a balanced distribution of individuals fluent in English, ranging from management roles down to the developer level.
Engagement Duration
Outsourcing companies consider the timing of a project when determining their pricing, often offering more favorable rates for longer-term projects as opposed to short-term ones. If you intend to engage in a project spanning multiple years, it's advisable to communicate this upfront, as it may lead to potential rate adjustments or concessions.
IT outsourcing can present its share of difficulties and unpredictabilities, leading to some of the challenges we've faced previously. For those engaged in software development, SDD-Technology is here to provide guidance on leveraging outsourcing not just to navigate uncertainty but to excel and prosper.
To stay ahead in the evolving landscape of software outsourcing, explore how SDD-Technology can support your business needs with innovative solutions and expert services.
This article references information from the "2023 Global Software Outsourcing Trends and Rates Guide" by Accelerance. For more detailed insights and data, please visit the original guide at Accelerance.
