When is a software development firm the best option?

Choosing the right software developer for your project is always difficult. The choice is complicated by the fact that many projects vary in their Scales, Requirements, Terms, and Budget.


It’s pretty clear with simple projects, for which outsourcing to a freelancer is sufficient.

  • What about the more serious projects that may need months or years to put into place?
  • Or those that require a large number of different specialists and technologies?
  • For projects like these, should you hire in-house software developers or trust a qualified software development firm?

Here are the top 5 things to consider when making your choice.


#1 Hiring Process in Software Development Firm

Keep in mind - finding a high-quality, software development firm ( sometimes it is also called a software house )  will not be an easy task, even though career sites are crowded with specialists.

The difficulty will depend on several factors:

  1. The urgency of hiring. How soon does the specialist need to begin to complete the project?
  2. The level of experience of the specialists. At the very least you should make sure that both junior and senior specialists are on staff, as well as the Lead Developer or Architect.
  3. Availability of ready-made software requirements. Otherwise, they will have to be prepared by hired specialists.
  4. A clear understanding of what size team you need. Taking into account that you are unlikely to get along with one or two specialists.


Additionally, for a full-fledged recruitment process, you will most likely need the help of a professional HR specialist or an agency.

Although, you can try to do it yourself, for example, using this service. If, of course, you have an abundance of free time to search for candidates and sufficient specialized knowledge to conduct the interviews.


The process of choosing the software development firm will be faster and easier if you consider the following:

  1. Vendor ratings on specialized sites
    GoodFirms, Appfutura, or Clutch.co are good places to start.
  2. Customer reviews
    Check their corporate website and social networks, because often both satisfied and disappointed customers leave their reviews there.
  3. Portfolio
    This should reflect their experience in development and the areas in which the company works.
  4. The skill sets of the development team
    The wider the range of skills of the company employees, the higher the chances of success of your project.
  5. Work within the framework of a single legal field
    Make sure that the vendor is ready to sign all the necessary documents that will govern your cooperation and guard your interests.

An analysis of all the factors above will help you determine who is the best fit and ensure the cooperation is as constructive as possible.


#2 Expertise in Software Development Firm

IT is a rapidly changing field that constantly requires training in new structures, technologies, and tools.

In the case of a full-time software developer, the responsibility for his training lies entirely with the head of the company. With this in mind, you can improve not only the level of training of your specialist but with it the competitiveness of your business. 


The software development firm that truly values its reputation and puts the interests of customers first always pays close attention to staff education of all the innovations and trends of the IT industry. 

Thus, with a reliable software development partner, you get not only full-cycle custom software development, but also a whole set of different practical skills, such as RPA or AI.

Just take into account the trends your employees can learn tomorrow, software studio specialists have already practiced yesterday.


#3 Software Development Firm Workflows 

An in-house software development firm is certainly convenient. When needed, you can immediately give specialists a task and at any time receive a full report on the implementation. To do this, you do not need to adjust to time zones or worry about communication methods. Still, it’s just one side of the coin.


The organization of work processes within the department and its interaction with other structural divisions of the company is not easy. Add to this the changing tasks, the need to constantly apply new management tools and technologies, motivation, and possible staff turnover... all of this is on the shoulders of the company’s head.


In a specialized software development firm, all work processes are put on stream.  As a rule, software houses use flexible project management methodologies (Scrum, Agile) and modern tools (e.g. Asana or Trello). All this, combined with a good project manager, provides stable feedback, constant monitoring, and control over the implementation of tasks at all stages of development.


#4 Security in Software Development Firm

When developing serious projects, a huge amount of information is created. A leak of which could cause the failure of the entire project.


Building a cybersecurity system for your company is a serious task and requires close attention, finances, and time. Therefore, if it is not yet implemented in your company, one of the best options would be to opt for a competent software firm.

Professional software studios are vigilant when it comes to protecting the confidential information of their customers, employing well-established cybersecurity techniques.


Also, your copyright will be protected by appropriate documents. In particular, the Non-Disclosure Agreement, which is mandatory for signing in case of outsourcing (!)


No. 5 Cost in Software Development Firm

Finally, and often the key point for all business owners, a cost.


For the maintenance of your in-house developers, your costs in most cases will consist of:

  1. salary
  2. training
  3. bonuses
  4. insurance
  5. paid sick leave
  6. taxes


Not to mention:

  • staff recruitment
  • office space
  • communication
  • management
  • business trips
  • supervision


By far the most expensive part is the salary. 

For example, in the U.S. according to Glassdoor, as of October 2019, the average annual salaries are:

  • Software Developer $80K
  • Android Developer $97K
  • Web Developer $75K

As mentioned above you may need more than 1 or 2 employees, so just multiply all these expenses by the number of employees. 


It looks like you will start paying hundreds of thousands of dollars a year just for the maintenance of your software development firm, right?

It would not be entirely fair to say that outsourcing will be much cheaper, although it will probably cost less than in-house developers. Everything will depend on the hourly rate of the software house, the type, and the scale of the project.


Typically, the hourly rate is between $50 and $150 per hour, although in some cases it can exceed $200 and more. 

As for all other related costs, they are completely dependent on your outsourcing partner and there is no need to worry about them.


Software Development Firm Summary

If to focus only on positive aspects, we can say that a software firm may be a more cost-effective option, while hiring software developers for an in-house team will undoubtedly bring more benefits in the long run. For more on the advantages of outsourcing, check out our previous article here.


Nevertheless, organizing effective work in-house is not that easy. This is much more difficult than finding a good software agency and building fruitful cooperation with them.

Whichever option you choose, remember that both full-time software developers and collaboration with a software engineering company equally require your attention, skills, and diligence.


We also advise you to consult with a professional software firm, get an estimate for your project, use professional help in proof-of-concept building, and listen to other their recommendations. This will not oblige you to anything, but can significantly aid in decision-making.

Consider this choice carefully because the success of your business can depend on it!

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