How outsourcing product development can give businesses a competitive edge?

How outsourcing product development can give businesses a competitive edge?

As competition continues to soar with so many new products dominating the market, the pressure to stay ahead of the curve increases. To be a key differentiator, one needs to innovate and develop products that can fit the audience’s requirements in the best way possible. Several factors affect the success of a product. If you are a decision-maker of your enterprise, you will understand that the whole idea is to maximize growth and innovation by delivering the best yet cost-effective products. The uniqueness of your product gives you an extra edge over others. However, developing a top-quality product that can shoot your brand up in the market requires a lot of effort and attention. At the same time, prior commitments, deliverables, strict timelines, and budget constraints can delay the entire process. This is where the role of outsourcing product development emanates. 

Before we dive deeper into how outsourcing product development and services can simplify all your design and delivery needs, read on to understand the process and spare a minute to analyze on your own.

What are we going to cover in this blog?

  1. What is product outsourcing? And why do you need it?
  2. What are the risks of outsourcing product development?
  3. Why product development outsourcing is the right step for you?
  4. What are the benefits of outsourcing product development?
  5. Companies who have opted for outsourcing services
  6. Are you ready to make the right choice?

What is product outsourcing? And why do you need it?

Product development involves three significant stages, design, development, and delivery. In the old school method, businesses used their in-house staff to manage their products from incubation to launch. They worked in several areas like market research, conceptual design, product engineering, prototyping, and other developments. Besides this, the process also included additional expenses and time invested in installing and maintaining different software. This also required constant follow-ups with the team for timely updates and changes on the various stages of the product development process.

Outsourcing product development means collaborating with an external team to turn your product ideas into reality. The outsourcing product development companies help businesses build new products from a different perspective and provide them with services including custom software development, UX design, product manufacturing, and many more. All these services are optimized by the latest technology and strategies along with their exclusive features. In simpler terms, they take some load off your shoulder and unburden you from the tedious follow-ups, iterations, and expenses while streamlining the process.

What are the risks of outsourcing product development?

Even though outsourcing product development has become a common trend these days, many businesses still opt for traditional in-house development assuming there’s risk and carrying other misconceptions associated with it. They fear lack of coordination, flexibility, and control, breach of security, loss of intellectual property, and dilution of the company’s essence if an external agency is involved. We are not saying these apprehensions are entirely false. There are pros and cons of outsourcing product development. However, one must remember that business involves risk irrespective of in-house or external services. It is always about making the right choices that make one stand out from the rest of the crowd. Choosing a credible outsourcing company can certainly eliminate these risks and lead to successful ventures.

Why product development outsourcing is the right step for you?

The success stories of multi-billion products like Slack, Github, Whatsapp, Groove, and several startups, product companies, enterprises, and businesses reinstate the fact that outsourcing product development works the best. It has been gaining a lot of popularity lately, especially after the remote work culture was embraced post the onset of the global pandemic. 

As per Deloitte’s 2020 Global Outsourcing Survey, ‘Outsourcing will remain an essential tool for client organizations to support their strategic goals.’

But how do you decide whether outsourcing or in-house product development is the right fit for you? These key benefits of outsourcing will help you choose the correct option.

Benefits of outsourcing product development | PrimeSoft Solutions Inc.
Benefits of outsourcing product development | PrimeSoft Solutions Inc.

What are the benefits of outsourcing product development?

Here are some of the benefits that make it count:

  1. Reduces cost without compromising the quality One of the significant advantages of outsourced product development is it cuts down some of the major expenses in businesses, specifically the 3RS – Resource costs, research costs, and rework costs. It takes away the cost and efforts incurred in creating a productive team which involves identifying the right talents with specific skill sets who understand the process and tools. Outsourcing optimizes the resource cost as it gives you access to a team of highly efficient resources to work on your project. Similarly, building software requires a lot of research with updated knowledge about the latest technologies and processes. Subscribing to outsourcing product development services allows you to save on the research cost as it brings you a team of people who come with their expertise in the different domains and ensure the best end results. A supplementing team of resources with relevant expertise within the outsourced organization and mature processes will cut down the rework cost.
  1. Saves time and effort for you to focus on core business – In-house development can take months or even years to set up the required equipment and manufacture the product. Every stage of development can be time-consuming, which ultimately delays the process overall. This elongated method can be curtailed with the help of outsourcing. It accelerates the product development process and powers it with quintessential features, enabling you to focus on the core business. 
  1. Ensures growth and innovation with expert assistance – It gives you the scope to work with world-class experts whose vision and expertise can help you innovate and grow. These leading product developers will manage multiple diverse activities, from product design (UX), building technology architecture, product management, development, testing, and quality assurance, to monitoring growth and sales.
  1. Doesn’t take away the control from you – It is often believed that roping in an external agency will take away the control from you. No, that is not true. You are still in charge of the project! It is a collaborative process where transparency is maintained between the vendor and service provider. 
  1. Awareness of the latest technology and trending strategies – Developing a product can take your business to the market, but to rank at the top, it must be equipped with unique attributes which can enhance the overall user experience. Outsourced product development powers your product with the best technology and strategies, keeping in mind the best marketing practices.
  1. Can be outsourced at any point in time – Imagine you want to execute a brilliant product idea but lack the right resources and team. OR you have already started the product development process but somehow feel stuck mid-way as you don’t see any progress. Shed your worries as you can easily outsource product development at any stage and run your development process seamlessly.

Why do companies choose to outsource?

Outsourcing is the trend these days. Outsourcing work to other agencies has become one of the most preferred options for companies. It helps them save money, effort, and time on a lot of additional projects allowing them to focus more on their core business.  

In simpler words, outsourcing is a process of performing a business endeavor outside of the organization.

The work rendered by outsourcing companies varies from industry to industry. The concept of ‘one solution for all problems or industry’ doesn’t exist here.

Every outsourcing company tailors its services as per the unique requirements, goals, and vision of clients. The outsourcing journey is not the same for every company.

Outsourcing IT services has become more accessible and cost-effective due to the powerful communication and collaboration tools used today. These service providers build the product taking into account the unique needs of the client, and deliver high-quality software applying creativity, innovation, and the latest technology in immeasurable ways. This allows vendors and clients from different backgrounds and expertise to connect and create something new and exclusive.

These organizations are big names in the industry but have successfully implemented the culture of outsourcing. They have understood the fundamental truth that the most effective way to grow faster and save money is to strategize the functions in a way that all aspects of it are being given equal attention. They have decoded this simple trick – internally, they can focus on the core business and outsource the non-core functions. Many companies have even taken the step of outsourcing their core business by associating with a credible service provider. Thus, it has become an essential component of any successful business strategy.

Companies who have opted for outsourcing services

Outsourcing has become a standard approach for businesses of all sizes, including some popular ones. Let’s see some of the big names that outsource.

  1. Google – Yes, you read that right! The first thought that comes to our mind is why an organization as massive as Google would prefer outsourcing when they can clearly set up their own internal team for the same. It is no surprise that they are one of the biggest companies in the world. They have become almost synonymous with the internet itself as people use its name as a verb when talking about searching online. Google is a technology company and is known for its exceptional business practices and policies. They have been outsourcing services for the Admin, and IT work for years now.
  1. WhatsApp – It has become one of the most followed modes of communication for people from all walks of life. Millions of people worldwide use Whatsapp on a daily basis for most of their communication. Looking at the huge demand, Whatsapp has recently ventured into the online payments feature to benefit customers further. WhatsApp wasn’t that big a company when they had started its business with limited manpower. They were quick enough to understand the benefits of outsourcing and decided to go with it, which helped them grow their business without impacting their budget.
  1. GitHub – It is one of the most known and used tools for developers and engineers. It instantly became their favorite repository to access data, look for documents, and share and host private code. Even though it was one of the best tools to go for while sharing details on the entire project, it wasn’t still apt for small code texts. To meet these challenges, GitHub came up with another idea, which they named ‘Gist.’ Though they were ready with the concept and its functionalities, they lacked enough time, capital, and resources to work on developing it. That’s when they decided to outsource the services of a developer to build it.
  1. MySQL – The practices and processes of MySQL have made them stand out from its competitors. They had clearly understood that they needed to adopt innovative strategies to compete and win. They decided to implement an outsourcing strategy from the first day of their inception. Even today, they continue with the same practice and have an almost fully outsourced development team comprising operational staff distributed around the world. It is a widely used relational database management system (RDBMS) compatible with several operating systems, including Linux, Solaris, macOS, Windows, and FreeBSD.

Are you ready to make the right choice?

One of the myths about outsourcing product development services is that they are accessible to only larger organizations. That’s not true. They are a suitable option for start-ups or SMEs and can positively impact streamlining their businesses. But before you decide to go ahead with outsourcing product development services, you must analyze a few critical questions. What do I want to derive from this collaboration? In what ways are these services going to benefit me? Do they fit our vision? If you are still unsure, you can scroll up the page and give the blog a quick read. It will certainly bring clarity and help you in decision-making.

With us, you can build a top-quality product by leveraging the expertise, processes, and perspectives of our team which comes with years of experience in working across several domains. Selecting the right service provider to collaborate with can help you take your product to the next level. Primesoft is a global IT service provider with expertise in Product Development, Cloud and DevOps, and Quality Assurance. Our in-house industry experts can guide you to make more informed choices and serve your unique needs. Please feel free to reach out to us with your ideas in the comments below. You will hear from us at the earliest.