We work with clients that are actively looking to leverage the benefits of outsourcing, know the challenges that come along with outsourcing and are comfortable with the trade-offs associated with the same.
Sure, software product development is considered as a core competency of ISVs. However, with time and fierce global competition, product management, rather than product engineering, has proven to be the core differentiator.
It has already become a trend that is followed by many successful product companies. Take a look at most of the software product companies that are dominating the marketplace (e.g. ServiceNow, AppDynamics, Slack, Fab, Skype, Branchout, Basecamp, Splunk etc) – all of them have large engineering centers overseas (mainly India). However, all of them also have product management rooted primarily in North America.
While the decision to outsource sometimes comes down to an emotional decision to most technical leaders, the economics of the same cannot be refuted. How do you compete in a marketplace when your total costs of releasing a feature is 4x more than it would have been if it was outsourced? Your core product might be a SaaS application but you also need to develop the mobile and API ecosystem. Are you going to hire for that? We recommend a step by step approach to companies looking at leveraging the cost differential benefits of outsourcing product development. The various models of benefiting from outsourced product development are :
- Full fledged product development
- Co product development
- Modular product development
- Peripheral product development