A guide: how to choose the best software development option for your company

This post will guide you on how to do custom software development time and cost efficiently or start the process easily.
Are you an SMB's CEO, CTO or top manager in charge of company development? You perfectly realize that technology and software play a great role in business strategy today. You might even have some software being developed for your business already or you've just realized that existing off-the-shelf software does not suit you well.

Software development heavily depends on people and processes. You have 4 different variants of custom software development. We put the list of them in descending order starting from the most expensive variant and finishing with the cheapest one. You can choose the way of software development that is more appropriate for you. So you are standing at a crossroad:

1. Local software development provider
2. In-house development team
3. Software development provider overseas
4. Freelance developer

Here they are.
Local software development provider
You can outsource your software development to the local IT provider. Ask your business partners to recommend you a good software development vendor or visit the IT conference to find some trusted companies. Local provider can work like part of your internal team. Moreover it is possible to bring teams together to discuss the project.
PROS
  • fast start
  • a team of talented and experienced professionals
  • face-to-face interaction
  • same time zone
  • little or no cultural boundaries and language barriers
  • governed by the same laws and codes as your business
  • deep cultural understanding of your business environment
  • small risks
CONS
  • the major drawback in dealing with local provider is the high cost
Hourly developer's rate in the countries of high cost living is usually above $150. This option is good for you when you are enough profitable and want to get the product fast.
In-house development team
In-house development is a good idea when you have enough time. You need to find and hire people. And it takes time till everything works out. It must be said that the price depends on the way you organize the process. You may hire just one or two developers or you may get the full pool of specialists such as developers, testers, designers and even project manager in case you are not a tech person. You might also need to pay license fees for using some tools and technologies and provide your employees with the working space.

PROS
  • in comparison with the local provider's services the in-house development is obviously much cheaper
  • in-house developers are always available and you have face-to-face communication
  • they understand your business process and create software that fits exactly to the business requirements of your company
  • you have the ability to hold your hand on pulse
  • you own the source code and the knowledge gained while developing the software
  • no cultural boundaries
  • small risks
CONS
  • slow start
Anyway, when you are not an IT company and realize that software development is not your cup of tea, focus on your core competency and let professionals to do the rest.
Software development provider overseas
Many executives believe that getting the job done beyond national borders in countries with cheaper developers makes sense. You can get high-quality, bugs-free and robust software for much less expenses. Obviously, the labour costs are much cheaper overseas. You can get the same work done for a quarter of the cost or even less. Why to pay higher for someone who is local?

PROS
  • low price
  • affordable for small budget
  • fast start
  • a team of talented and experienced professionals
  • focused strategy
CONS
  • moderate risks to choose trusted qualified provider
  • language barriers
  • time zone differences
  • no direct communication
  • cultural differences
Freelance developer
You can also hire a freelancer who is good at IT development and can produce a perfect product for you. At different freelance marketplaces such Upwork (previously oDesk), Elance, Guru and some others you can find a proper candidate. You just need to browse profiles, sort and filter by hourly rate, country, feedback score and find the ideal developer. You can also post a job offer. Freelancers will bury you in their resumes. The most important issue here is to be tech-savvy to figure out whether the candidate is so skilled as he talks of himself.

PROS
  • low price as freelancer's rates are more affordable; you don't need to invest in equipment and tools; you don't pay for holidays or sick leave
  • you can have an expert for a short-term period to perform the task
  • freelancers more likely to work evenings and weekends to complete the task
  • fast start
CONS
  • high risks
  • difficult to choose the right qualified person to trust
  • unpredictable product quality
  • sometimes freelancers are used to "get lost"
  • difficulty of project management, progress tracking and time consumption
  • language and time zone differences
  • cultural boundaries
  • language barriers
You may give your preference to the freelance developer but remember that you have to be competent in matters relating to the tech part of the project to make the right decision and not to embarrass yourself. And you might as well need several developers to work on your project.
Thinking it over
Though every option has obvious advantages each one still has some meaningful drawbacks. When you opt for one of the above listed solutions you suddenly realise that the drawbacks this option has can be easily resolved.

* Choosing right qualified provider is really a big challenge. You need to pick a reputable IT provider who can create software that accurately meets your expectations. Check provider's website and portfolio. Ask them questions. See how they interact. In our future articles we will cover this issue in more detail.

* Language barriers is not quite a problem as the offshore companies speak English.

* Time zone differences is in fact beneficial as you get your job done while you are sleeping.

* Face-to-face communication can be achieved via Skype. More over the provider will always be in touch via email or phone.

Just decide what option you are comfortable with and don't be afraid to start.
Conclusion
An average US-based provider will cost you $120-200 per man-hour for only reason – made in USA. Not to say about the advanced developers' costs. The developer with 10-15 years of experience will cost you $150 per hour. Average Eastern European price is $30 hourly. No doubt you can find a newbie developer that will charge you much less but imagine what product quality you will get for that price.

We picked out four most significant criteria ("Price", "Time to start", "Risks" and the necessity to be "Tech-savvy" that can help you to make your mind on what's better for you. Check what we've got in the box below.

As you see everything depends on your company's needs and opportunities.
Small company/Startup/small budget
When your budget is small you can develop software on your own (in-house) or hire a freelancer. In-house development is pretty affordable but takes long time to work everything out. Also you will need project management to monitor the development. If you are not a tech person you will spend years to be good at it. In fact it may turn out to be a real challenge for you. Or you may meet a co-founder who is a tech-savvy.

If you are not sure you can handle it there is a better option for you – to reach out to the software development company. Companies specializing in software development are usually able to recruit experts with deeper experience and they have wider knowledge of the subject which will benefit the quality of the product.
Big company/Small company/large budget
When your company is big or you have an investor and you want your software to be done very fast then contact a local software development provider or provider overseas. Software development vendors will deliver you high-quality product very fast. It usually takes them 3 to 6 months to finish it. They will then support you during the product deploying and some time after it.

Outsourcing software development implies higher risks but it has proven to be a great success for many companies worldwide such as Skype, Fab, Github, Opera and many others. With the simple sport analogy you can see that the most important benefit of outsourcing is that you can pass the ball to Ronaldo to score that goal for you.

All in all, the complexity of software is comparable to that of modern engines such as airplanes and satellites. That's why it is important to partner with knowledgeable, stable and experienced developers. To find great software provider is difficult but it's possible. Make sure you are in the right company.
We hope this post was helpful to you.

Have you any experience dealing with the software development? Do you have any questions? Please, share your thoughts with us.
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