Guide On How To Choose The Right Custom Software Development Company



Bonus: At the end of the article, look for the Validation Spreadsheet that I developed specifically to save you a lot of time and money and find the best developer for your project.

# 1 Choose the software development partner

Anyone who thinks about software development with the help of third-party developers will probably end up with three to determine which option will be the best fit for your project.

 

Freelancers

These guys are lone wolves who have made code the meaning of their lives. But ... Not all of them and not always.

Pros:

  1. Low cost of services
    It's true. Freelancers do not pay taxes or insurance (unless they have legal grounds for professional activities), so they can afford to lower their hourly rate.
  2. No need for formal employment
    Do not hire, so do not have to fire. No severance pay or other formalities. It is counted.
  3. No need to equip a workplace
    In general, a freelancer always seems to be a carefree dude who has a cup of coffee in one hand and a laptop for work in the other. So, you don’t have to buy expensive equipment and organise a workspace for this guy.
  4. Suitable for precise, fast tasks
    I think everything is evident here. If you have in mind - complex software with costing, a large amount of data, etc., then read on.

 

Cons:

  1. Lack of contractor liability
    Unfortunately, there are few organised people and even fewer self-organised people. There is always a risk that the freelancer will run out of inspiration, and then the project will be in jeopardy.
  2. Failure to meet deadlines
    There can be many reasons - from banal emotional burnout (when you are tired of doing what you need) to force majeure circumstances like illness.
  3. Lack of skills needed.
    The brain of one person limits a freelancer’s knowledge. And that is a fact. It is unlikely that you will be able to meet a freelancer who knows front and back development, knows how to write mobile applications and at the same time understands servers well.
  4. Loss of control over workflow. Once again, about everything that is written above. Failure to comply with deadlines, lack of high-quality feedback, and task planning errors makes it very difficult to control the workflow.
  5. Privacy breach risk
    When working on a project, a freelancer inevitably gets access to various company databases, which is often necessary for work. And who knows how he uses this data in the future …

 

Inhouse

Your own development team, which is always ready to plunge headlong into the company’s problems and tasks. Or not? Let's take a look.

Pros:

  1. All control is inside the company
    Since the project is carried out by its employees, all the control, constant monitoring, and the ability to change the project’s course are at the head of its head.
  2. Higher level of data security
    The risk of private data leakage through its employees is much lower than when third parties work with this info. But this, unfortunately, happens. It is even more offensive.
  3. Faster communication
    Of course, discussing the critical stages of development is easier by going to the next office than waiting for an answer, say, from another continent. No argument.
  4. Flexibility and time saving
    Any changes in the project, as well as requirements, can be made as soon as possible.

 

Cons:

  1. Constant and substantial costs
    All the costs of maintaining your employees are naturally on your back:
    a) monthly payments of salaries 
    b) taxes and insurance plus sick leave
    c) incentives and bonuses, etc.
  2. Hiring is a time-consuming process.
    I am sure you want good specialists to work on the project. Headhunting them will not be so easy. But that is not all. Professionals are expensive. Also, they still need to be lured to their team with something interesting and exciting.
  3. Technology requirements
    Development requires a wide range of knowledge in various fields. If your engineers do not have them, then work gaps can be expected. Who to blame? I will leave it unanswered.
  4. Staff turnover
    If someone from the internal IT team suddenly decides to quit right during the project (and this happens), finding a replacement will be a real challenge. It’s not worth talking about the deadlines and unforeseen expenses that will accompany this.

 

Software Houses

Software Houses are professional IT software development companies with extensive experience in developing excellent software and its subsequent support. 

Pros:

  1. Reduced overhead costs
    You don’t have to worry about the costs associated with:
    a) the operation of heavy equipment
    b) the use of expensive software and technologies
    c) staff training 
    All this is the responsibility of the outsourcing software development company.
  2. Reduced labour costs
    Most likely, you will agree that it is not always more profitable to keep permanent employees on your staff than to pay third-party developers if necessary without losing quality.
  3. No long-term commitment 
    Special outsourcing agreements are concluded with the outsourcing partner, which has clear terms of cooperation, performance, and payment terms. Such an arrangement is of a fixed nature and depends entirely on the needs of the customer.
  4. A wide selection of professionals 
    A professional Software Development company has in-house employees with relevant qualifications, tests and enhances its employees’ skills. So the customer gets all the quality assurances.
  5. No license obligations
    When choosing to outsource, an organisation does not need to worry about acquiring the necessary tools and technologies for development and associated licensing costs. It is entirely the responsibility of the outsourcer.
  6. Costs & expertise balance
    Once again, about money. When you outsource a project to a software development company, you know for sure that specialists in their field will work on it for a fixed amount in the contract.
  7. Well-established workflows
    Qualified IT software development companies always try to develop a software product as convenient as possible. They use different workflow or integrated Business Process Management systems to increase efficiency and improve work organisation.

 

Cons:

  1. Risk of picking the wrong software development company
    Here the advantage of a wide selection of professionals turns the other side of the coin. Unfortunately, there is a chance of running into the wrong software development company. The good news is you can avoid it. Just read the article to the end.
  2. Communication and time zones difficulties
    Cultural, linguistic and location differences can hinder effective collaboration. This minus can be minimised if you use universal English for communication and adjust to each other's work schedules.
  3. Legal Pitfalls
    Unfortunately, there is always a risk of information leakage when a third party accesses the data. You avoid this problem by paying due attention to the cooperation contract’s relevant points with a  software development company.

 

# 2 Check Information Sources about the software development company

Here I will focus on the primary sources that can complement (or spoil) the service provider’s general overview.

Review sites and software development company rates

A good software development company is on the list of the best ones in its niche.

Check whether your potential partner is so good in the developer segment that he already is in the top 10, 20 ... of the best developer companies. How?

I will focus on trusted review sites such as GoodFirms, Appfutura or Clutch.co (links below). Do you think the reviews are critical? Yes! What about rates? Important. These platforms confirm the identity of the reviewer.

 

Social networks and software development company’s face

Continuing the conversation, I’ll say - check the social networks (Linkedin, GitHub, Facebook) of the software development company you choose for your project. It's the shortest way to check a company's culture, content and comments.

 

One more thing about the software development company reputation

Don’t discount the omniscient Google. Google carefully stores information about everything. Enter the name of the software development company or, say, its CEO, and enjoy the results.

 

# 3 Check software development company’s response time for inquiry

Next, it’s time to chat to a potential outsource partner (or maybe there are a few of them for now). You can:

  1. leave a request for cooperation 
  2. ask them to clarify some information
  3. request a preliminary calculation of the cost of the project 
  4. or ask any other questions about the software development company

Pay attention to how they respond and how fast they do it. It should always be clear and thorough. Usually, it should not exceed 24 hours. If there is a contact form on site, the response should be even faster.

An essential indicator of transparency and overall performance is the speed at which the software development company responds to customer wishes and comments.

Response time is possible to check by several metrics:

 

Reply via email or web form:

  1. up to 1 hour - perfect
  2. up to 24 hours - Ok
  3. more than 24 hours - oops, it’s too long...

Chat Form - honestly, it should be  immediate, or at least not more than 5 mins

So your time is valuable. Do they value it? Just consider that. 

 

# 4 Get to know the software development company before your first meeting

The next step is to deeper analyse your potential vendor.

To get started, take a look at the corporate software company website. In a software development environment (as in any other business), there is an excellent vital practice of posting all the vital information about the company here. Does it look like they made it at the beginning of the century? No? Fine.

By checking software companies sites, especially "About us", "Our team",  and similar sections, you get a complete picture of a potential partner’s team’s qualitative and quantitative composition. 

 

 Important points to focus on:

  1. The management team of the software development company
    Information about the people who are at the head of the software development company can say a lot about those to whom you will entrust your idea. Often you can find quite detailed characteristics of leaders. They may include a biography, stages of work, professional and personal qualities, etc.
  2. Number of specialists at the software development company
    Human resources are one of the leading indicators of the software development company's viability. It indicates the interest of people in working in this company on the one hand. On the other hand, this proves the company’s financial stability and may indicate the skilful use of moral and material incentives.
  3. Range of special skills of software development company's team
    Good developers always keep up with the times. Knowledge of various programming languages ​​and development technologies (Ruby on Rails, Python / Django, Node.js, etc.), the use of flexible methodologies (Agile), and specialisation in the creation of not only the web but also mobile applications of varying complexity indicate the level of skill of the website and software development company.
  4. Availability of software development company's qualification certificates 
    Often on the pages of the software companies website, you can find information about the various achievements of employees and the company. It indicates the company's desire to keep the bar high in its development.

BTW: You can read which Popular Tech Stacks are used in big software products here: stackshare

 

# 5 Workflow and Communication with a software development company

Find out how the the contractor maintains the interaction processes, I mean ’communication tools’. Why? Because they completely solve the tasks of setting and monitoring tasks, as well as feedback.

It is better to choose tools for your project based on three parameters:

  1. Price
    As a rule, the basic version is offered for free or a free trial period. The price is usually loyal and depends on the communication channel’s functions and the users’ number.
  2. Cross-platform
    It is more about the technical side. Both the customer and the contractor should be equally comfortable using the chosen tool, regardless of which platforms their equipment works on.
  3. Integration ability
    Provides for the use of communication technologies in which the contractor is ready to adapt to the customer’s work processes and needs.

 

Here are a few Popular tools :

  1. Asana is the most straightforward way for teams to track work and get results.
  2. GitHub - host and review code, manage projects, and build software.
  3. Slack is chat rooms for your whole team.
  4. Trello gives boards, lists, and cards enable organising and prioritise projects.
  5. Jira is a project management tool for agile teams.
  6. Google Hangouts is a video call, phone, or message tool.
  7. Skype is an alternative channel for direct communication.

 

# 6 Time Zone Matching with a software development company  

I realised that the difference between the customer’s time zones and the software development partner is often underestimated. It becomes a huge mistake that can lead to failures in the workflow.

From my experience, I’ll say that for efficient and effective collaboration, it's enough to have 2...4 crossing office hours. So this will provide all necessary feedback and allow us to resolve issues that might arise quickly.

Service for checking time zones: worldtimebuddy.com

 

# 7 Documentary guarantees of cooperation with a software development company

We finally came to the legal side of cooperation.

I bet your business idea is unique, so be sure to take care of the confidentiality and safety of your trade secrets with NON-DISCLOSURE AGREEMENT.

It's the first and the most crucial document you need to consider. 

The NDA’s essence is that the two parties undertake to protect the confidential information available during the cooperation.

The main terms of this contract are:

  1. Execution of work
    When gaining access to internal processes and company data, the party to the contractor is obliged to organise its work in such a way as to prevent information leakage.
  2. Areas of responsibility of the parties
    Not only data protection obligations should be provided, but also acceptable grounds for its disclosure.
  3. Fines and validity
    Responsibility for non-compliance should include penalties - from a fixed amount of a fine to different possible costs.

 

In conclusion, I can say that choosing the right software development company for your project is not an easy or fast task. Most likely, you will have to look through several candidates before finding the right one. 

 

To simplify this task, I prepared a Validation Spreadsheet. It has 12 essential criteria that will allow you to choose a website and software development company that meets all the requirements, quality and expectations.

 

To avoid a headache when outsourcing the project, I prepared Five Tips that will significantly facilitate collaboration.

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