10 Mistakes to Avoid While Hiring IT Outsourcing Companies

Software Development Outsourcing is fun as long as you keep putting things in place. One wrong move can bring disasters to your outsourcing models.

Today, the software industry has completely realized the importance of outsourcing IT services to offshore countries. Not only do they cut down the huge costs of developing software or apps but also provide quality results and output from a great team of developers.

While it may sound easy to simply hire an offshore outsourcing company for your IT services, the process of outsourcing should be taken care of with great importance. One is ought to make mistakes in the process but the best thing is that you can avoid it. Yes, with some tips and tactics you can make yourself aware of the situations and take proactive steps. 

Here, from my personal experiences, I have put down some major mistakes that a company should avoid while outsourcing its IT services to an offshore software development company. The good thing, I have also mentioned the solutions or precautions that you should take. Let’s get along.

10 Mistakes to Avoid While Hiring IT Outsourcing companies

No Clear Idea of What to Outsource

The perks of outsourcing like cheaper costs, high quality work, and more time to focus on core tasks may lure you to go for outsourcing your IT services at first. 

Many businesses fall into these temptations and jump into getting their services done by outsourcing companies without having adequate plans, research, and proper goals.

There are some questions that businesses need to ask themselves before hiring IT outsourcing companies. They are:

  • What core activities of the business need to be outsourced?
  • What is the main objective behind outsourcing, cost reduction or lesser load on the internal team?
  • What shall be the hiring process of the outsourcing company and how many developers do I need?

Once you have answers to these questions, things will slowly be clearer to you and you will have clear objectives of what to do and how to go ahead with the outsourcing process. 

With a clear plan you will easily be able to track your project’s progress and check your KPIs from time to time.

You must know that not every task needs to be outsourced and there are some works that should be handled by the in-house team at any cost, for e.g., customer-related tasks. Your internal team can better understand the needs of your customer than an offshore team.

Not Bridging the Management Gaps

When you plan to outsource your IT related tasks to an offshore IT service provider, always remember to fill the management gaps.

You must be wondering what it is! By management gaps, we mean not having transparent communication, not having a dedicated project manager, no project management tools, no proper interview schedule, etc. 

You need to find out the exact requirements for proper management to be carried throughout the outsourcing process. Having a dedicated project manager in a team will let you have complete control over the development process. The project manager will also act as a contact point between you and the outsourcing team.

Use of project management tools is strongly recommended. We have numerous industry-standard project management tools like Jira, Asana, Tracker, Evernote, Google Apps, etc., that helps you keep things organized and have clear communication with the team.

Conducting regular meetings is very essential when you have a team sitting countries away developing a product for you. This not only helps keep things clear and transparent but also maintains a healthy relationship among the team members and leaves less to no room for discontentment.

Going for the Cheapest Option

Every quality product or service comes at a certain cost. Although the whole intention of outsourcing is to lessen the cost burden on the company, going for the cheapest option may sometimes backfire. 

Any compromise with price beyond the borderline may lead to compromise with quality as well. Businesses fall into the temptations of ‘lowest prices available’ schemes and regret later. Some startups may look for the cheapest options due to budget constraints, but in the long run, that is going to hurt your pockets for sure. 

Hence, it is always advisable to first set your budget. Having a clear budget in hand will let you browse through the plethora of options available and have the flexibility to choose between the ‘lowest option’ and the ‘quality option’ in the market. 

Also, when you have a set budget on your table, moving 1$ – 2$/hour up or down won’t hurt you if the quality of the service is assured. In the end, you want a product or service that adds value to your business and this is a kind of one-time investment. You will not develop software again and again, hence invest wisely. 

No Defined Hiring Process

One of the biggest mistakes businesses commit while planning to hire IT outsourcing companies is not having a defined process of hiring and interviews.

In a marketplace (obviously digital), if you find yourself telling, ‘Wow..this company has got such an impressive portfolio, it’s the one I am going to work with’, you’re probably committing this mistake.

No matter how impressive a portfolio of an IT outsourcing company is, you should always ask for interviews and have a defined hiring process at the place.

Hiring without an interview is like marrying someone without knowing the person. The portfolio and credentials should be properly evaluated. You should check their previous works like how many apps or websites they have developed, the range and variety of clients they have worked with, niches of their development, etc.

Never be shy about asking for an interview. Taking interviews lets you connect with the developers and check their communication skills in person. You would not want to hire a team and find out at last that the team you have hired is unable to communicate due to language barriers.

It is also essential to have an interview scheduled before you start officially working together so that you can better understand their time zone preferences and your alignment with it. Interviews, overally, let you interact with the team of developers and discuss various topics, which in turn, helps you both better understand the ‘terms and conditions’ of each other.

No In-depth Research

After selecting any offshore company for IT outsourcing, another mistake that businesses make is not doing in-depth research. Research about the company, research about the team of developers, research about the other options available or the COMPETITORS.

It is not as easy as it sounds to choose the right outsourcing provider. You need to do a lot of research to find out the best option for you. Even if you have selected a company and taken the interview, try to do some research about the company.

Try to find out the history of the company, the work profiles of the developers, and the options available in the same price-range in the same country. They might be the outsourcing company’s competitors and may provide more qualitative services than the company you have selected.

Never settle down with just one company’s interview. Interview at least two-to-three service providers and then select the best option you have for your outsourcing requirements.

While conducting research, another important thing to check for is customer reviews. There are some websites that will give you the honest reviews given by the customers about the company you are going to work with.

Not Having a Diverse Team of Developers

When going to hire dedicated developer from an offshore outsourcing company, always make sure the team you make is diverse and includes all types of developers.

By all types of developers we mean developers having expertise in different languages and different platforms. For instance, your aim is to develop an app for both PlayStore and Apple App store but the team that you have hired consists only of Android developers.

According to your needs and demands, try to include different developers having different domain expertise in the team you are going to hire.

Having a diverse team will also help you make or ask for slight changes that need some extra talent from a developer, which one developer may not be able to provide.

Another advantage of having a diverse team is that you do not have to panic in the case a developer decides to quit in the middle of a project. This is usual and any developer may decide this for various reasons. Therefore, you should alway be prepared beforehand.

Also Read: Artificial Intelligence (AI) vs Machine Learning vs Deep Learning

No Clear Outsourcing Terms

When outsourcing your IT services to an IT outsourcing firm, always ensure you have clear terms and conditions laid out from both sides before entering into any agreement.

Rather than going into a verbal agreement, always make sure you get those typical ‘terms and conditions’ in a written format no matter how obvious those points are.

Mention each and every point that you feel should be mentioned and will be required at any time in the future. Your expectations, services sought, number of developers in the team, time zone preferences, work hours a day, exit plan, security and testing, etc., should be mentioned in the agreement. 

Not having clear outsourcing terms may create ruckus if the outsourcing company suddenly decides to move out of the agreement or in the worst case, stop any communication midway. Also, a defined agreement will not leave any room for confusion moving forward with the project.

No Proper Onboarding Process

When you have focussed on all the above mentioned points and taken utmost care to not commit those mistakes, here comes the time to finally hire and ONBOARD the team.

Yes, even if they are a remote team and not your in-house employees, you should arrange for a proper onboarding process. A smooth and organized onboarding process acts as an ice-breaker and helps the team of freelancers to get acquainted with the in-house team.

The onboarding process also helps the in-house team share the vision and mission of the company, the expectation they have from the team of developers, the expected time frame, and other technicalities.

Although all these things are already discussed with the project manager, it is always better to have these discussions directly with the developers as they are the ones who will be working directly on the project. 

This process also removes any anticipated communication barriers between the two teams and helps the freelancer team understand the process better.

Not Welcoming Technology

Outsourcing IT services in itself means welcoming new technology to your home. But what most businesses miss out on is leveraging the power of technology that they get from the outsourcing companies. 

Not all businesses understand the importance of technologies like Big Data, Cloud Computing, AI and ML, and lose some of the best opportunities they might have otherwise gotten. This also leads to losing a huge customer base to your competitors. 

Going with big technologies may burn your pocket to some extent but is always beneficial in the long run success of a company. Small businesses and startups find it a bit difficult to go with the technology but the long lasting effect is the reason most of the businesses choose it.

Leveraging the correct set of technology makes you efficient, saves time and money in the long run, and makes you competitive enough to stand in the market besides giving you the flexibility to scale your business any time you want. 

Hence, it is always recommended to leverage the power of technology whenever you are planning to hire IT outsourcing companies for your business. 

No Proper Testing

Many businesses deem testing to be the last minute activity and do not focus on it throughout the development phase. Teams are only focussed in making a product (an app or website) and spend most of their time in this, leaving very less time out of the time duration for testing.

This is usually done in the waterfall model of development, which has already become backdated. Following the agile process of development necessitates testing in every phase of development, thereby improving the quality of the product as well as saving a lot of time.

If following the waterfall model, a bug is found at the end, the development team has to go back step by step to find it out and fix, whereas in the agile process, you get to know the issues after every phase, hence it saves a lot of time for both the parties.

Hence, it is strongly recommended to follow the agile process of development and give utmost priority to testing in every phase of development.

Wrapping Up

With this, we come to the end of the blog mentioning ten mistakes in detail that businesses make while hiring IT service providers from offshore. Once you are aware of these mistakes and know where to take the right decision and which way to go, you will see greater overall results saving time and money. We hope these points help you in recognising the errors and taking preventive measures the next time you plan to hire an offshore IT service provider.

John Peter

John is a professional technology blogger who has been doing blogging for the last 5 years. He loves to write & share content about web development, software programming, digital marketing, SEO, social media, tech gadgets, etc.