State of Software Development Outsourcing - Overview of the IT Outsourcing Market

Marcin Grajoszek - IT Recruitment Specialist at Sunscrapers

Marcin Grajoszek

5 May 2023, 7 min read

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What's inside

  1. What conditions should your outsourcing vendor meet?
  2. Tools to improve teamwork
  3. Effective practices for on-time project delivery and quality control in geographically dispersed teams
  4. Conclusion

As the majority of you know, software development is one of the most important parts of the business ecosystem nowadays, and it does not seem it will change anytime soon. You may also know that there are two ways (generally speaking) to create any IT product - you can either make your team (in-house hire) or outsource the work to a trusted (hopefully) partner.

In this article, we will take a general look at the state of software development outsourcing - practices that are being abandoned, the most important conditions that your future partner should meet, tools that are commonly used in cooperation, and ways to mitigate risks connected to the fact that the team is located (usually) in another geographical region.

What conditions should your outsourcing vendor meet?

Now that we know what to avoid, let’s see what you should look for when seeking your trusted partner.

  1. Quality

In my honest opinion this is the most important thing you should look for. Your future Vendor must be focused on quality to deliver the projects according to your expectations. Your vendor's quality may present itself through the skills of their developers, the practices they follow, and having reasonable quality assurance in place. You can also see if their developers are involved in open-source projects and communities. This is usually an indicator of sound engineers.

  1. Communication

As you probably can imagine from the first section, good communication with your vendor is essential to your product's success. You have to see if their team is responsive, speaks fluent English, is transparent in their everyday work, and if they do provide frequent feedback. It’s also good to see if they understand your product and will give you their insights about possible solutions.

  1. Security

I hope you know that data security is fundamental nowadays. That is why when looking for your vendor, you must be sure that they can handle your clients' sensitive data. You should ask them about basic security measures they follow every day.

  1. Experience

Another aspect that, in my opinion, is highly relevant is your vendor's experience. You should check if they have worked on projects similar to yours and if they can understand your business domain. This will almost guarantee saving a lot of money and avoid common mistakes, especially if you, as a product owner, are new to the whole software development process.

Naturally, there are plenty of other aspects, but I believe these four are the basic ones that should always be verified.

Tools to improve teamwork

Now it’s a good moment to briefly examine the tools that may be used daily to improve the collaboration between you and the vendor.

  1. Project management tools

The most important one. The choice of tools to manage your project may influence the overall result. The most obvious choices are Jira, Trello, Asana, and Basecamp.

Those tools will help you manage tasks, track the overall progress and budget and give you a comprehensive view of the project's success. Your involvement in those tools will help the vendor deliver results that match your expectations.

  1. Communication tools

Since we established that communication is crucial to any IT project, choosing a proper tool to manage it is essential. Slack, Microsoft Teams, Zoom, or Google Meet is the obvious choice.

Most good communication tools can be connected to project management software, allowing communication to help the project progress further and enable all stakeholders to be on the same page.

  1. Version control tools

It’s obvious, but it’s important to understand this aspect if you're a newcomer. Version control tools like Git or SVN help teams manage changes to the codebase, keep track of different versions of code, and collaborate on code development.

I cannot imagine that any software vendor is not using those tools, so I’m writing it mainly for newcomers to understand that this is an essential part of the process.

  1. Code Review Tools

Tools like GitHub, GitLab, and Bitbucket allow the software teams to quickly review the code, provide the feedback and keep track of quality.

Sometimes, the client may be a part of this process, so it’s good to know about their existence. But 90% of the time, engineers will mostly use them.

  1. Collaboration tools

Tools like Google Docs, Confluence, Dropbox Paper, or Notion can make it drastically easier for teams to collaborate on documentation, share ideas, and create content together.

They can also be used for planning and reviewing the plans later on (especially if you add MIRO, for example, as a tool for creating diagrams or managing planning sessions).

  1. Test management tools

Last but not least are the test management solutions. Software like TestRail, Zephyr, or PractiTest will be beneficial in keeping track of the tests, writing down any bugs that arise, and seeing the overall progress of any fixes that may be needed.

This brings a lot of order into something that tends to be chaotic if one sticks to emails and slack.

Effective practices for on-time project delivery and quality control in geographically dispersed teams

Having analyzed all the points above, one important aspect needs to be mentioned. Usually, the vendor and the client are located in different areas or continents. That does not need to be a problem, but we need to see the best practices that can be used to ensure the project is delivered on time and with quality. Those practices may also significantly lower any risks related to the software development process.

I believe most of the risks are mitigated simply by Agile Methodology practices. This is what I will focus on in this chapter:

An Agile methodology is a popular approach to software development that emphasizes flexibility, collaboration, and rapid iteration. Agile methodologies, such as Scrum or Kanban, can help teams deliver projects on time and within budget. And it’s possible by a few essential values:

  1. Prioritising features and tasks: Agile methodology involves breaking down a project into smaller chunks, allowing teams to prioritize and focus on the most important features and tasks first. This helps ensure the most critical components are delivered on time and within budget.

  2. Continuous delivery: Agile methodology emphasizes delivering working software quickly and frequently. This enables teams to get feedback from stakeholders early on, identify and fix issues sooner, and adjust project priorities and scope as needed.

  3. Iterative development: Agile methodology involves continuously iterating on the project, with each iteration building on the previous one.

  4. Emphasis on collaboration and communication: Agile methodology strongly emphasizes collaboration and communication, which helps ensure that everyone on the team is on the same page and that issues are identified and addressed quickly.

All those values are supported by a set of tools and align with the values you should look for in your software development vendor.

That is why following those reasons may bring you closer to success - which is defined by finishing a project within time and budget and delivering software that will solve your client's business problems.

Ultimately, your clients are an essential part of the equation.


The software development outsourcing industry has experienced significant growth, with companies seeking to reduce development costs and access specialized talent.

The state of software development outsourcing is constantly evolving, and companies must weigh the benefits and risks of outsourcing before making decisions. Choosing reliable outsourcing partners and establishing robust processes and procedures is crucial to ensure successful outsourcing engagements.

At Sunscrapers, we follow all of the best practices and constantly improve our skills and knowledge to ensure our cooperation runs smoothly.

Feel free to drop us a line and discuss your needs - contact us.

Marcin Grajoszek - IT Recruitment Specialist at Sunscrapers

Marcin Grajoszek

IT Recruitment Specialist

Marcin is an IT recruiter with a background in sales who finds real satisfaction in the intricacies of the recruitment process and developed strong relationship with IT experts. Outside of work, he devotes his free time to sports.




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