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Project-based Software Development Outsourcing

What Is a Project-Based Model?

Project-based outsourcing, also known as software outsourcing or outsourced product development, is an outsourcing model in which your development partner oversees and manages the entire process according to the specifications you provide prior to the start of the engagement.

How it works: A project-based outsourcing model is the most traditional and most hands-off of the three types of outsourcing engagements. In this type of engagement, you hand off the requirements to your outsourcing partner.

Responsibility and management: Your outsourcing partner will fully manage the development process, responsible for delivering the final product according to the specifications you provided and the agreed-upon timeline.

Control: Although you retain the least amount of control with a project-based outsourcing model, your in-house Project Manager / Product Owner will still be in contact with your outsourcing partner from time to time. The frequency of these communications is up to you and your outsourcing partner to decide, as it’s highly dependent on your specific project and its requirements.

When Is a Project-based Model Best For Your Business?

When you have a project that is not your core product. While project-based outsourcing can be a fit for businesses of all sizes, it tends to work best for larger businesses (e.g., mid-market and enterprise) and for projects which are not the business’s core product.

When you have limited in-house development capabilities. A project-based model can be a good fit for businesses with limited in-house engineering/IT capabilities, as the responsibility and process are owned by the outsourcing provider. By outsourcing development to an experienced software outsourcing company, even the least tech-savvy businesses can develop a custom software product — either by building from scratch or by customizing existing platforms and products.

When you have a simple, straightforward project with pre-determined requirements that are unlikely to change. A project-based outsourcing team can execute these requirements without your guidance or input.

When you want a specific product developed — without the burden of management. Again, project-based outsourcing works best for clients who have a clear vision of the product they want to develop. Since you know what you want, you can effectively hand off your project, freeing yourself of the burden of management.

What Are the Advantages of a Project-Based Outsourcing Model?

Project-based outsourcing provides many of the same benefits as staff augmentation outsourcing and managed team outsourcing, including access to top talent, significant cost efficiencies, increased flexibility and scalability, speed to innovation, and no recruitment risk.

Increased clarity on timeline and outcomes. In a project-based outsourcing engagement, you’ll clearly define timelines and deliverables before the engagement begins, leaving you with a clear understanding of the end result and timelines.

The minimal time commitment for you and your in-house team. Though this type of outsourcing affords the least amount of control over the development process, it can be a huge advantage for some businesses. You may have a simple, straightforward development project in mind, but you don’t want to take your in-house engineering team’s time away from more mission-critical projects. You could let the project sit in your backlog with “low priority” status, or you could outsource it with a project-based approach. By choosing the latter, your team’s time and attention stay focused on your high-priority projects. You get the results you seek with a minimum effort beyond documenting your requirements.

Responsibility for project success lies outside your company. Although you are responsible for documenting the initial requirements and specifications, your outsourcing provider is responsible for ensuring the execution and delivery are successful. Your contract and/or SOWs hold them accountable for delivering on their commitments.

Project-based software development outsourcing works well when you have each and every detail of the project ready. For more get in touch.