Should Your Organization Adapt to Insourcing or Outsourcing?

venkatesan | October 16 - 2014

When it comes to software development all it cost is best efforts to understand the limits of dedicated insource developers and selecting the right outsourcing partner such that the project comes out in flying colors. Dedicated inhouse developers may be able to develop the project with their years of experience in the field. But in few cases, we may have to travel the extra mile to engage a outsourcing developer for the specific project requirement. There may be cases where a inhouse developer may lag in certain skills that are required to complete the project in which case outsourcing is best alternative possibility.

Mostly mid-sized and large companies like to employ an insource because it allows the company to stay in touch the employee for making any changes or fix errors inorder to get a control over process flow. In case if the need is for an expertise, then outsourcing may be a good alternative choice and reduces administrative burden.

Why Outsource?

1. Reduce labor cost: Outsourcing supports reduced labor cost. The rate of hiring the outsource developer on hourly basis is very less when compared to hiring dedicated full time inhouse developers. Cost of labor is cheaper overseas.

2. Project specific skill: The outsourcing can be the best choice when you need specific skills for completing the project. The skill requirement may change according to the project which makes it flexible to hire developers for the specific project. Insourcing may be a costly effort when each project requires different skill set.

3. Distracting office environment: The productivity at work may be greatly affected with distracting office environment with interruptions at work in case of insourcing such as lunch, chitchat, commuting etc. While in outsourcing, the developer may work for hours payment to show performance which does not include any work interruption hours.

Disadvantage of Outsourcing

a. Quality control:

It is one of the biggest challenge faced by the outsourcing. The quality of the code cannot be assured with few portfolios of the developer on the site. This issue can be handled by employing a consultant who could handle the legwork of producing quality by interviewing the developer before hiring.

b. Code collaboration

Depending upon the country, it becomes difficult for the developer to understand the requirement. Therefore it become obvious to specify requirements properly to get a better outsourcing experience. Scrum method of development may be useful for such cases which ensures proper development with scheduled meetings and insight on the project.

c. Time Zone

In case of outsourcing, the developer may be in a different time zone which makes it uncomfortable to communicate with the developer. Sometimes one has to wake up all night to receive the messages from different time zone. Hiring a project manager nearby the time zone can be an effective solution to handle this situation.

Why Insource?

1. Vested interest: The insource developer may have vested interest in the company affairs to invest their time and energy. They are full time dedicated developers who may work for you in parallel projects at the same time which can save your time invested.

2. Easy accessibility: Your developer is just beside you to receive your inputs and feedback to make changes in the project. While in outsourcing one has to wait for the meeting time to communicate which makes the work to be little fussy.

3. Multiple projects: The dedicated insource developer may work for you in parallel projects with the common interest in the company while outsourcing can be done only for specific project for specific hours.

Disadvantage of Insourcing

a. Cost

The cost incurred can be too high for insourcing. Hiring a dedicated developer may be too expensive.

b. Time

Finding the right source or developer may be a difficult job which takes its own time. Demand for skilled developers are too high which makes it difficult to hire developers.

Choosing between an outsourcing or insourcing developers clearly depends upon the situation and the need. Mostly one can find talented developers as freelancers who are less expensive to hire than a dedicated full time developer. Before employing a developer for both insourcing and outsourcing, one should be clear about what is the outcome expected, how to evaluate the coding, how much money goes into the development, etc.