The increasing popularity of outsourcing, all over the world, indicates businesses’ inclination toward output quality and performance, more than location. However, businesses often face challenges like timeline, geography, budget, communication etc. When it comes to the most outsourced services, software development is often found at the top of the list. Outsourcing software development not only offers flexibility to businesses but also enhances the level of collaboration. Technically, offshore outsourcing is the practice of contracting out IT-related work to third-party agencies or firms, located in different parts of the world, where labor cost is considerably low and the outsourcer can enjoy various tax benefits.
Offshore Software Development Models, Segregated By Levels:
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- Low-Level Offshore Development Model
Both customers and the outsourcing organization benefit from this model. In the low-level offshore development model, the outsourcer leads product management and the outsourcing company takes care of the software development and quality checks.
- High-Level Offshore Development Model
Similar to the Low-Level Offshore Development Model, it keeps the outsourcer in charge of product management and allows the outsourcing company to take care of the project management, solution and test design.
- Complete Technical Outsourcing
This model involves hiring offshore teams of specialists, who can offer consolidated technical guidance to the outsourcers. In the case of Complete Technical Outsourcing, the outsourced functions range from developing a single page, a multi-functionality eCommerce website, to a cutting-edge IoT, AI or ML-imbibed application.
- Low-Level Offshore Development Model
Offshore Software Development Models, Segregated By Business Models:
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- Fixed Price Offshore Development Model
This low-risk model involves setting a fixed price for the completion and delivery of a project from the beginning to the end. It is ideal for outsourcers, capable of sharing clear project specifications with the outsourcing firms. Using the Fixed Price Offshore Development Model, an outsourcing company can make sure it clearly envisions the client’s requirements and properly estimates the cost and timeline of the outsourced project. In this engagement model, the success rate is often higher, considering the consistency in output quality and timely project delivery, offered by the outsourcing company. - Dedicated Team Offshore Development Model
This is among the most used offshore development models, based on business models. In the case of the Dedicated Team Offshore Development Model, an entire team is assigned by the outsourcing company to work on the client’s project and the resources are allocated considering the client’s requirements. In such a scenario, clients often get a chance to choose skill sets and resources as per their requirements, and to complete the development process with knowledge retention, while protecting their Intellectual Property Rights (IPR). Also, when it comes to this particular model, the dedicated development team sits at the client’s location and the client experiences considerable cost reduction along with high-quality timely outputs. - Time And Material-Based Offshore Development Model
This model makes sure the project efforts in this methodology are exact estimations, in terms of execution time and resources deployed. The direct result of the project efforts is the project expense. This engagement model is ideal for high-quality complicated projects, which are prone to design and specification changes, all through the project execution. Time And Material-Based Offshore Development Model offers flexibility as well as scope for constant development and alteration of project parameters, considering the steadily-changing market demands.
- Fixed Price Offshore Development Model
Offshore Software Development Models, Segregated By Services:
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- Project-Based Offshore Development Model
This model is ideal for projects with set timelines and unambiguous resource requirements, which do not change throughout the development process. Known for ensuring cost reduction, the Project-Based Offshore Development Model allows outsourcers to contract out multiple projects. Also, this model is extremely beneficial for companies looking to outsource irregular, one-off and pilot projects with well-defined deliverables. - Offshore Development Center Model
This model brings considerable profitability when projects are outsourced to experts. The offshore development centres are generally based out in countries, where labor cost is low. Ukraine and India are among the countries that comprise maximum offshore IT resources and highly skilled development teams. Ideal for long-term projects, Offshore Development Center Model is mostly preferred by companies looking to cut down development costs but not ready to compromise with the output quality. In the case of the Offshore Development Center Model, the outsourcing company assigns a dedicated team of developers to supervise only one project at a time, to ensure high-quality timely outputs. - Staff Augmentation Offshore Development Model
This model enables a company to augment its local presence and conduct simple technical processes with the help of offshore developers. In the case of the Staff Augmentation Offshore Development Model, the outsourcer gets direct control over the offshore teams, whose product perspectives and improvisations are often limited. However, in such a scenario, the offshore teams, that often deliver outputs within the predicted time frame, are never held responsible for the projects’ success.
- Project-Based Offshore Development Model
Summary:
Evolving by leaps and bounds, Offshore Development Models, today, are available for businesses with different IT-related requirements. The outsourcing team is often considered a ‘scalable tool’, that can be used to ensure quality as well as quantity of the outputs, throughout the contract tenure. The complexity of the outsourced project and the client’s preference determine which engagement model is ideal for the business. These models are segregated not only by the style of work but also by the level of involvement, terms and conditions, under which the employees are compensated.
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