We had worked with multiple clients across the globe. By this, we have found jumbled experience in terms of their outsourcing aspect or hiring a dedicated software development team. The top reason cited for outsourcing.
To keep up with the fast-growing world, it is necessary to take business decisions in the shortest possible time. Not only do you have to make the decision in the shortest possible time but also have to make the correct decisions.
We had worked with multiple clients across the globe. By this, we have found jumbled experience in terms of their outsourcing aspect or hiring a dedicated software development team. The top reason cited for outsourcing focuses on core business.
Once we also come across a company that outsourced to freelancers only to get destroyed. The freelancers they hired disappeared in few days, leaving their reputation in danger and it took them almost a month to get re-started.
There are numerous factors responsible for arriving at an outsourcing decision. This blog is all about the lessons we have learned from the successful and failed startup. We are proud to share this list with you. This list will help you to make the decisions in the shortest possible time. This will also help you to avoid mistakes and advice to outsource your tech business.
Let’s get started!
Lessons Learnt From Successful Outsourcing
1. Outsourcing Doesn’t Create A Hole In Your Pocket
Outsourcing saves a lot of your money and time. The best example of this is Joel Fernandez. Priorly, Joel Fernandez had the experience of managing offshore teams. To kick start his third company Klout, he went to his offshore team’s workplace and stayed there. He returned 3 months later with a working prototype.
It is much cheaper and is another benefit of this. This extended the amount of time he could kick start the company. It also lets him focus completely on what he was building since he was living in a distraction-free environment.
2. Take Your Time To Decide What You Want To Outsource
It is always important and advisable to decide first what to outsource. It saves your energy and resources too. For example, two CIOs left and Ryan of the Jpay company on the edge of confusion about whether to find another partner or to outsource.
After all the failed efforts they decided to outsource. They had decided to outsource engineering teams to Israel, Q&A to India, and hardware and firmware to China.
Based on their technology, JPay experienced hyper-growth, but the technology team was scattered around the world which increases the set of challenges for the company. Ryan makes a firm decision to take back his tech team, and the rest is history.
An entrepreneur must need to know when and which parts of the company to outsource.
3. Begin Outsource With A Non-Core Function
The Squawker team is the best example of how to work on a development project. They were perfectly capable of steering the project while bringing in external partners to build an integrated implementation team as their core team had decades of trading and financial technology experience.
There are lots of important lessons to be learned from Squawker regarding how he managed his entire project. According to Dimitry Stillermann, the reason that the Squawker and his team brought ultimate success is Squaker’s decade-long experience and his team.
Startup founders often begin with a very business-oriented team and assume that they can outsource all or almost all of the responsibility for the technical solution.
4. Large Reduction Of Business Expenses
It is a fact that Outsourcing reduces business expenses. Its best example is Google. Google officially launched its R&D center in Ukraine based on CloudSimple in the year 2020. The example of this company clearly shows that there is always a place for advancement and innovation, even if you already have the world’s largest team of developers.
CloudSimple is now a part of Google Cloud as well as it improves its VMware migration solution. Without any doubt or question, the decision to offshore was not preconditioned by the lack of expertise. Regardless, it offers a huge reduction of business expenses because of offshore hiring.
Lessons Learnt From Failed Outsourcing
5. Inability Of Lodging With Frequent Changes
A lesson that we learned from outsourcing came from PatientDox is just we can't forget life long. PatientDox is a cloud-based startup. It provided a Software as a Service (SaaS) for healthcare providers. Even though the co-founders decided to create a product to service their consumers, they were focusing on software and tech-based solutions. Even though neither the owner had a technical or software engineering background.
In the end, a maximum of the costs involved with development came from the product development stage which smash the cash reserves as the founders realized they didn’t have enough capital to continue afterward.
6. Never Outsource In The Initial Days
It is always advisable not to outsource in the initial days. You must give yourself time to understand your requirements in the initial days and then take the decision to outsource.
McGuire had collaborated with a development organization in his initial days to create his product, like any other startup. Unfortunately, it didn’t work well because of which McGuire ended up burning a lot of money and time.
In short, the process of offshoring does not mean getting rid of responsibility. But it is quite the opposite, create the best strategy, choose the best country which is beneficial for you. Most importantly, collaborate with the right partner. Redlio Designs would be pleased to take care of your separate operational tasks or provide full support for your R&D.
We will be happy to serve you! So, contact us now to know more about our teams and our services.