What Are the Most Effective Software Outsourcing Models?

Software Outsourcing Models

Do you think the term outsourcing partner is used in the software development realm only? Of course not, there are many activities that you need to outsource in your day-to-day lives. For example, if your tap starts leaking or if you are out of ingredients and you need to prepare an urgent dinner for your colleagues. You see hiring a plumber or hiring a chef to prepare some lip-smacking food for you, this is all about outsourcing. And to be honest software outsourcing is no different, all you need is a reliable outsourcing partner.

Software Outsourcing can help businesses to embrace technology solutions, improve business productivity and streamline operations. Hiring a dedicated development team to manage specific requirements of enterprises with a deeper understanding of business goals is what businesses need. Software Outsourcing services is a smart choice to upscale businesses and see faster results without worrying about the technology side.

Are you ready to Hire a Software Development Outsourcing Partner?

Software development outsourcing is a general term used to define the process of hiring experts from overseas to develop specific solutions. In simple words, they can be called third-party providers who excel at developing the project, maintenance and support, migration, Quality assurance services, and so forth. When you hire a software development outsourcing partner what happens is that you can avail a wide range of benefits. Benefits such as you getting to focus on your core competencies, cost-effective solutions, gaining a competitive edge in the least amount of time, minimal downtime, 24/7 support available and whatnot!

Further below I would like to mention certain tips to keep in mind when hiring a software development outsourcing partner or a dedicated team.

  • Clarify your requirements, and prepare a small yet crisp checklist.
  • Take a close look at their work portfolio
  • Finalize the budget
  • Make sure you choose the one featuring relevant industry experience
  • Pick the right software development outsourcing model

Moving on! What is a software development outsourcing model? Well, whenever a new development process is about to begin or a new software development outsourcing model is introduced, what happens is the CTO maps it out well and ensures that each developer or programmer can handle the required scope of work. There are different types of software outsourcing available around – Onshoring, Nearshoring and Offshoring. Each one is of a kind. So without any further ado, let’s begin!

Onshoring – As the name implies, this one means you and your dedicated team are located in the same zone. Onshoring means your software development partner is pretty close by.

Nearshoring – This is one step ahead of onshoring. Yes, your countries might be different but your timezone remains the same. Of course, your software development company is located in a nearby country but there are no language barriers or any cultural differences.

Offshoring – Imagine your in-house team is in Australia and you decide to work with software development companies in India, this is what we call offshoring. In simple words, you may face time-zone differences, language and cultural barriers but here you won’t be needing to spend your hard-earned money extravagantly.

Offshore outsourcing or conducting a software development project among offshore countries is the best and most cost-effective technique to pursue. Moving on! Further, I would like to shed some light on certain outsourcing models to take into consideration before you begin your development process.

Top Software Outsourcing Models

Once you have decided upon who to partner with, it’s time to focus on the software outsourcing model. You see picking the right dedicated team model can take you places whereas not doing so can break you well into pieces. This is not a threat, it’s a piece of advice. What is a software outsourcing model? Well, it is a simple way that says how the development process will be carried out and delivered. Choosing the right outsourcing software development model mainly depends on your core needs and requirements. However, down below I would like to shed some light on the best outsourcing models to take into consideration. Let’s get started!

Time and Material Model

Now we all know the fact that software development projects are continuous in nature. I mean there is no scope for rigidity, everyone has to remain flexible. And one of the major factors that directly affect the development of a project is time and budget issues. This is the reason why we have a time and material model.

The model enables you to have full control of the development partner overseas. Yes gone are the days when business owners were supposed to take vague guesses regarding the expenses. Also, the model has resulted in a low probability of paying high overpriced charges. When to consider the Time and Material model?

  • When you lack in terms of defining precise requirements
  • When the scope is still not known
  • Flexibility is important enough
  • More changes are expected during the development process
  • The project is much in relevant to the ever-changing markets and technologies

The time and material model works wonders when things are done within the right time and procedure. In fact, as a client, you are supposed to be the responsible one. The delivery of the project highly depends on speed, how professional your development partner is and accuracy while dictating project requirements. How is this software outsourcing model beneficial?

  • Low cost and low risk
  • You don’t have to pay in one go
  • Great for large-term projects
  • Early development process
  • Easy negotiations on enhancement

Dedicated Development Teams

What happens when you choose the dedicated development team model, here you tend to hire an entire team of professionals including, developers, designers, project managers, testers, and every important person who is willing to work for your project only. These people act as full-time dedicated employees who can work as your external team.

Now here you are in charge, yes you read it right. Your dedicated team is supposed to work under your command. Also, you can be specific here, for example how many developers do you need (bifurcate juniors and seniors), testers, architects, project managers, and so forth. In fact, here you have the liberty to be a part of the recruitment process. Yes, you are eligible to take interviews, review the performance and so forth. When to consider the dedicated development teams model?

  • When your in house team is unable to match up
  • When you want to finish the project in the nick of time
  • Flexibility is the core objective and the project is long-term
  • When redesigning a project

Unlike any other outsourcing models such as the staff augmentation model or managed team model, the dedicated software development team model means adding more people to your existing team. In other words, if you are looking for a more holistic and business-oriented approach, look no further than this one! Further below, I would like to mention certain benefits of using dedicated teams.

  • You can save a lot
  • Flexibility and scalability are at paramount
  • Delegated Management
  • Tailored procedures
  • Streamlined communication
  • Long-term continuous projects

Staff Augmentation model

The staff augmentation model has been buzzing around a lot lately. And why not since it has been successfully attracting businesses globally. Now an IT Staff Augmentation Model is a basic outsourcing software development strategy where businesses are supposed to hire resources externally. All these external resources are meant to fill up positions within your team in both ways, temporality as well as permanently.

Here businesses are supposed to choose candidates who can only fit your requirements whenever required. It’s like scaling up when you need team members and scaling down when you don’t. When one must consider the IT staff augmentation model?

  • You have people working in your office and wish to hire external programmers overseas
  • When you are unable to find reputable programmers locally
  • You want to personally choose the candidate and manage them.

The scarcity of tech talent cannot be ignored at any rate. During such cases, these software outsourcing models can be of great help. How is the staff augmentation model helpful? Let’s find out!

  • High chances of hiring an appropriate candidate
  • Low development cost
  • Hassle-free development projects
  • Surpassing geological limitations
  • Enhanced flexibility and scalability
  • Expansion and Adaption


Another intimidating concept among the list of software development outsourcing models includes project-based. This is said when your development partner is supposed to manage everything from overseas. All you have to do is be specific with your needs and requirements.

Here all you need to do is give your requirements to your outsourcing partner and let them take care of everything else for that particular project. When you should opt for a project-based model?

  • When the project is a mere project and not the main product
  • When you lack in regards to in-house team and capabilities
  • When the project is pretty simple and with predetermined needs
  • When you know exactly what you want

On and all, the project-based outsourcing model works extremely wonders for startups and small-scale businesses. Now let us find out how this kind of software development outsourcing model is beneficial?

  • Predetermined timeline and outcomes
  • Minimal Time Taken
  • Focus on your core competencies
  • Cost efficiency
  • No need to carry extra fuss or burden regarding the project

Multi-vendor Model

Today I have come across several business owners willing to build up their very own multi-vendor eCommerce marketplace. Well, some of the popular names include Amazon, eBay, etc. Now, what exactly is this multi-vendor model? Well, it is a web platform that establishes a digital commerce network where all kinds of sellers and customers can make things work together.

Why do we need a Multi-vendor model?

  • It is easy to sell a plethora of products
  • All the logistics and inventories can be well-taken care of
  • Least expensive
  • High-flexibility

What makes a multi-vendor such kind of software outsourcing model a cut above? Well, every phase can be planned and executed in a subtle manner right from the backend development to frontend development, UX design, and so forth. Some of the crucial benefits of a multi-vendor marketplace include:

  • It is powered by Magento
  • High-level security
  • Responsive and Customizable eCommerce platform
  • SEO-friendly
  • UX-centric and conversion-focused design
  • Keeping up with the latest industry trends
  • Generating precise reports
  • Enhancing sales and marketing departments

Fixed-Price Model    

The Last but certainly not the least software outsourcing model we have is the fixed-price model. In fact, this one is my favorite! You see its the most robust, epic and astounding one available across the globe. As the name implies, here the price is fixed right from the beginning for a particular work.

All the tasks which are supposed to be carried away are well-defined in prior. Yes, this happens even before the customer decides on the budget. If your project comprises a pre-determined scope and you exactly know that these requirements will stay the same. Then simply consider the fixed-price model. Benefits of the fixed-priced model include:

  • Precise requirements
  • Transparent financial venture
  • Commitment to accomplish in the given time and money
  • Low risky venture

Final Thoughts

And we have reached the end of the article! I hope the following post justified the title. Still, in doubt, feel free to mention that in the comment section below.