Offshore Product Development: Not Just For Cost Cutters Anymore

As you know, the primary reason most companies take their product development needs offshore is to cut costs. Taking advantage of overseas development substantially decreases the costs involved in developing software. However, most organizations today still focus on short-term tactical outsourcing, with the sole purpose of hitting cost-focused objectives. Yet, when managed properly, offshore product development (OPD) can provide so much more: innovation, faster time-to-market, better flexibility and scalability, better testing, and better quality software. Let’s look at these four areas in depth.


If you choose the right outsourcing partner, they can bring more than just bodies to a relationship, the right partner can bring ideas and innovation. This innovation can be around leveraging the partners collective experience gained in other industries or tackling other technology challenges. Initially, your outsourcing partner may have innovative ideas around how to architect or build out part of your product or how to test in a different way. Over time, as your partner builds more knowledge of your industry and customer base, your partner should be bringing innovative ideas that differentiate you in the market from a business perspective as well.

Faster Time-to-Market

Your in-house development team has a maximum capacity, which means, they can only do so much in a day. Everything else must wait until they can get to it. Companies can churn out more solutions at a faster pace utilizing OPD because additional offshore suppliers can work on multiple projects, which rapidly decreases time-to-market. Further, by outsourcing to distant time zones, the daily development window can be enlarged, which boosts capacity to levels that an in-house team wouldn’t normally reach.

Better Resource Scalability

The internet runs 24/7 and you must scale to fit current and changing needs as they arise. OPD allows organizations to throttle up resources almost on demand, thereby avoiding the steep in-house cost (both financial and emotional) of hiring then terminating employees. Outsourcing makes organizations responsive, allowing them to capitalize on sudden commercial opportunities or respond to resource-related challenges in a way that is just not financially feasible to do with limited in-house resources.

Better Testing

The speed of development is becoming more rapid. This means identifying bottlenecks is key to staying fast. One of the most common bottlenecks in getting world-class products to market is testing. OPD companies have the frameworks, processes, and tools in place to accelerate their development and testing and ensure that the end user/customer gets a higher quality product.

In the end, the keys to successful OPD are:

  • Vendor selection: choosing an experienced and technically qualified offshore product development supplier. Making sure they know your development environment, or be prepared to train them. Check references carefully.
  • Communication: ensure you have well-communicated expectations and requirements. Require timely reporting, and develop tools or criteria to benchmark the quality of output required from the supplier, while simultaneously monitoring the suppliers performance.
  • Strong Relationships: a high quality relationship between the client and supplier is critical. Projects based on excellent relationships tend to have the highest service and quality.

Experts Produce Better Software

Your company has many business functions, including operations, sales and marketing, development, and support. However, an OPD has a singular area of expertise: product development. You benefit from the efficiency this produces, as partnering with a business that exists solely to develop first-class products is a real asset, and quite frankly much more challenging to create with an in-house team. Technical expertise is essential. The best OPD teams also have proven (and demonstrable) processes in place to help ensure and control quality at every stage of the software development lifecycle.

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