Software Development Outsourcing: 10 Biggest Mistakes


The right software development outsourcing strategies alongside a good provider can give tech companies great results. Software development is one of the best strategies for tech companies that want to reduce expenditures, improve quality, and increase efficiency. 

However, as promising as that sounds, why do some outsourced software projects fail? 

Let’s look at the biggest mistakes a tech company can make when utilizing software development outsourcing. 

Top 10 Mistakes to Avoid

Unclear Expectations and Software Requirements

an image depicting an unclear expectations and software requirements

The project scope should be clearly defined and adequately documented so the vendor understands what is expected of them. It is crucial to indicate objectives, deliverables, and timelines. You must thoroughly communicate these to your vendor to prevent missed deadlines, added costs, or output that does not meet your expectations.  

Selecting an Outsourcing Partner Based Solely on Price Factor

Software development outsourcing is an excellent way to cut company expenses because hiring in-house staff is significantly more expensive than outsourcing costs. However, if you don’t select the right partner, you may pay more, so you must research and work with an outsourcing firm with a proven track record of success. 

If you only focus on the price factor, you may compromise quality. You want to partner with a software development outsourcing company with extensive experience, as this helps to guarantee the success of your software development project.

Limited Research and Discovery

Companies need to adequately research the market or validate ideas before assigning the project to their outsourced software development team instead of making assumptions about what their customers want. 

Investing in product discovery with the appropriate team members is essential to ensure that any innovations are on track to succeed. 

Ideally, this team should include a project manager, business analyst, UI/UX designer, development engineer, and software solution architect, all bringing unique perspectives and skill sets to the project. 

Through market research, interviews, and surveys of potential customers, companies can gain insight into what users want and use this knowledge to develop solutions that meet their needs. 

Product discovery is an investment in your company's future success, allowing you to produce competitive products based on honest user feedback.

Improper Onboarding Process

It is essential to have a comprehensive onboarding process to ensure a successful software development project. This involves introducing your project requirements and sharing relevant knowledge with the outsourced developer while evaluating their skills throughout your collaboration. 

The mistake many companies make is assuming the outsourced teams will get it right away. This is a costly mistake, so invest in providing your offshore team with the proper orientation and onboarding process.

Lack of Communication

an image depicting effective collaboration by having an open communication.

Communication is vital in outsourcing. Strive to have an overlap if your in-house and outsourced staff have different working hours and maintain regular contact through meetings or check-ins. When your development team takes your project in another direction, doing everything over can be costly and time-consuming. 

Transient Project Managers

Ensure to have at least one software development project manager engaged in the project from beginning to end. This will provide continuity and responsibility for the project's development throughout its life cycle. And also help ensure your team can focus on their objectives and meet your customers' needs. The project manager will be able to assess the project's progress accurately. They will also identify potential problems quickly to avoid delays or cost overruns. 

Furthermore, having an experienced professional on board allows you to spot problems. Oftentimes, this may be overlooked by internal team members. Having an experienced professional will allow you to take appropriate action promptly. All these factors ultimately contribute to a successful outcome for your software development projects.

Lack of Collaboration 

Software development outsourcing requires collaboration between in-house and outsourced teams. This can be challenging, especially when it involves bringing together people with different skill sets and cultures. 

The success of any outsourcing venture depends upon forming a trusting relationship between the internal team and external contributors; each party should feel that their contributions are valued and respected by the other. 

Furthermore, setting clear expectations about deadlines, roles, and responsibilities is essential. This will ensure a common understanding among all team members about what is expected from them throughout the project. 

By always maintaining open communication, your partnership will have every chance to succeed!

Lack of Guidance for Outsourced Team

While we can expect to hire industry experts when we outsource. We shouldn’t delegate everything to them and leave them unsupervised and unsupported. We should perform regular check-ins and provide feedback so they know how to move things forward. 

Security and Confidentiality Issues

an image depicting team members working together to ensure security and confindentiality of the project.

Regarding outsourcing software development, data security, and privacy are of utmost importance. Several areas come with a certain degree of risk when outsourcing such projects. This includes the potential for sensitive customer information like credit cards, medical records, and login credentials to get leaked to third parties. Additionally, there is a risk of your code and other intellectual property being appropriated without authorization. 

Furthermore, there may be a need for certifications from credible sources such as ISO 9001, ISO 27001, GDPR, or SOX. This should protect both your business and the data owned by your customers from any potential cybersecurity risks. 

Compromised client data or proprietary information can be an absolute nightmare. Ensuring that all appropriate measures are taken to limit potential liability issues arising from outsourcing software development projects is crucial. 

It is also vital for businesses considering outsourcing software development activities to ensure they have proper contracts. This guarantees the safety and security of their data and customers’ information before engaging in such arrangements.

Choosing the Wrong Outsourcing Provider

You’ll want to ensure your outsourcing provider has the expertise and experience to complete the project successfully. Selecting the right outsourcing provider helps prevent the risks previously discussed. Furthermore, choosing a partner who cares for your success will aim to drive results.

Final Thoughts

Software development outsourcing comes with benefits and risks. So it’s vital to plan this partnership and choose the right outsourcing partner thoroughly. With those considerations in mind, find the best ways to maximize your collaboration with your outsourcing provider selected.

If you need expert advice on getting your project off the ground without worrying about these risks, contact LANEX today. We can discuss the best project development and delivery approach for your business.

Have a project in mind?

Let us know. We’d love to help out.