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Top 5 Challenges of Software Outsourcing and Overcoming Them

What are the biggest software outsourcing challenges? The growth of the IT talent pool worldwide has made software development outsourcing popular, accessible, profitable, and … overwhelming. IT services make up 72% of the global outsourcing contract values for many good reasons — efficiency, cost-effectiveness, and access to an immense talent database. At the same time, there are challenges associated with outsourcing software development that you don’t have with in-house solutions. At GeeksForLess, we have 18+ years of experience as an offshoring and nearshoring partner, and we have helped fix many issues our clients had with other vendors. We know the challenges we all face with outsourcing software development, and we have the answers. Here, we have listed the biggest challenges in outsourcing software development when working with a third-party vendor and ways to avoid them.

Software Outsourcing Challenges

Challenge #1: Project control and decision-making

Working with an external service provider from a different geographical zone implies having to let go of a part of project control. You can provide all the tasks, deadlines and deliverables. However, the distance, lack of permanent contact and often the time difference can make it challenging to maintain control.

Who will make the important decisions regarding the project? Who exercises full control over the changes, alterations and ideas? Indeed, project control is one of the main problems of outsourcing software development, and is also an obstacle to why businesses are hesitant about resorting to outsourcing in the first place.

Solution by GeeksForLess: Choose an experienced vendor, who has signed more than one outsourcing contract. In the contract, you will be able to define to what extent the outsourcing contractors can take decisions regarding your project. At GeeksForLess we make sure that contract terms are crystal clear to both parties and that all the risk is eliminated. We also work with Agile software development methodology, allowing us to check in with our client at different project stages, which also gives you an idea at how control / decisions are exercised.

software outsourcing challenges

Challenge #2: Cultural differences and geographical barriers

Reaching out to a vendor located oceans apart can come with two types of cultural challenges: organizational and regional. Organizational differences refer to the way work is handled within a company based on the culture and background. Regional challenges imply anything that is directly related to the physical location of your outsourcing vendor: time zone, language barriers, holidays, etc. Time zone differences might extend the global project duration. If your team is based on the other side of the world, you might have to wait for them to answer your message.

Solution by GeeksForLess: To avoid language barriers, choose a team with excellent knowledge of English. Our team can guarantee seamless communication in proficient English, where not a single line of code will be lost in translation. To optimize the project duration regardless of time differences, we work with instant messaging, remote work and project management tools (Jira, Slack, Basecamp etc.). The teams can upload their ideas, comments and changes without having to wait for the other party to come online. We also make sure that all the sprints, check-ups, calls and deadlines are put in writing before starting the project, so that our clients can have a visibility over the roadmap.

Challenge #3: Data security and intellectual property

There are no universal laws covering all the possible outsourcing operations. At the same time, you expose your priceless data to a third-party company you have never met. While nobody is ever fully safe from data breaches, you can always get as close as you can to 100% safety by choosing a trusted and experienced vendor.

Solution by GeeksForLess: Sign an NDA to avoid any data breach. Prepare other documents you or your legal team may deem necessary to ensure your project security. Go through and confirm clauses on compensation, responsibilities, data security, ownership, non-compete clauses, etc. If any part of your software is proprietary, an experienced vendor will also make sure that your solution is GDPR-compliant and is not exposed to any other security threats — data security should never be one of problems with outsourcing software development.

Challenge #4: Hidden costs

Outsourcing usually comes with the “pay as you go” model, and there is always a chance of extra hours, resources and extended timelines. It is rather difficult to give a 100% accurate price in advance, however it doesn’t mean you should be losing money. After all, outsourcing is here to help you save costs, not the other way round.

Solution by GeeksForLess: Set any budget requirements or limitations in advance. The more questions you ask about any potential hidden costs, the more prepared you will be.

problems with outsourcing software development

Challenge #5 Knowledge transfer

This challenge can arise in two situations:

  • When you are deciding on the project roadmap with your vendor, and you fail to provide transparent and clear knowledge transfer, you might experience issues in the process. The outsourcing company will fail to meet your expectations if not everything is clear.
  • After the project has been finished, you may experience issues with the knowledge transfer — this time when the vendor transfers the project to you.

Solution by GeeksForLess: We establish a detailed knowledge transfer plan. Together with you, we discuss all the challenges, code logic, questions, pitfalls — our goal is to make sure your project keeps thriving once we have finished our part of work. Software outsourcing is an excellent way to dive into the global talent pool and choose the best vendor for your project. It does, indeed, come with certain challenges — after all, all great business do. The goal is to select the best, most skilled provider who will help you figure out all the documentation, knowledge transfer and answer any question you might have in the process. At GeeksForLess we consider it a great privilege to provide you with premium quality service — and it’s our job to make your outsourcing experience outstanding.

GFL Expert Professional Employee at GeeksForLess Inc.

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