Outsourcing Software Development: 5 Common Risks

Gimena Aguerreberry
June 29, 2021

With the economy going global and constantly evolving technology many companies find it increasingly hard to develop the whole spectrum of software solutions in-house. They are forced to maintain a competitive advantage by continually optimizing their operational efficiency, improving customer service, and bringing new products to the market.

The answer to these challenges is the right team of software developers who not only ensure the end product’s quality but also focus on your overall business objectives and goals. And, this dream team doesn’t have to be in-house.

Sometimes the wisest decision is to outsource software development while keeping the focus on your core strategies. A great partner can help overcome difficult software outsourcing challenges by injecting your project with collective skills and expertise coming from a variety of their previous projects and clients.

Outsourcing Software Development: 5 Common Risks - and How to Avoid Them

Some outsourcing risks are common business risks, just with the added complication of not occurring under the same roof. Other risks are more about choosing the right vendor. It’s essential that you know what risks to watch out for in outsourcing a software project and ways to avoid common pitfalls.

Basing Decisions on Price when choosing your outsourcing partner

Outsourcing may be an extremely cost-effective solution for small businesses to meet their software development needs, but it still costs money. Businesses that are on an especially tight budget usually filter their software programmer options depending on price, and they sadly often go with the cheaper ones.

The problem with using the price to decide which outsourcing software development company to hire is that you’re potentially compromising value. Hard as it is to accept, the best things in life aren’t always free. Sometimes, you really do get what you pay for.

The few extra dollars you saved won’t matter in the long run if you end up outsourcing your programming needs to a sloppy, inexperienced programmer that ends up damaging or delaying your project, so cost savings could lead to poor quality.

Failing to Build Strong Communication Ties

When dealing with outsourced projects, communication can be difficult. Since developers aren’t working in the same building, it’s difficult to communicate feedback to them regularly. Along with that, there are also multiple factors to consider, such as overcoming the problems associated with different time zones, languages, and cultural norms.

Effective communication is a skill, while English is merely a language. When communicating with outsourced developers, comprehension of the project requirements and clarity on the deliverables are the most important factors.

A good tip to avoid this is to establish strong communication ties from the beginning. Be sure to work with vendors who are proactive about meeting schedules. Use of collaboration tools, like Slack or Asana, regular engagement with the remote team via video or audio communication, and stand-up meetings at regular intervals, are best practices for establishing communication channels with the outsourced development team.

Designate a product owner who is available to answer questions and be the point of contact between your business and developers. Encourage them to give you insights on the project regularly so that if any mishaps do occur, you’d at least know about them.

Setting Unrealistic Standards

This mistake is quite common amongst business owners who are fairly new to the software development sphere. They have a vision of how they want their app to function and how they want it to serve their consumers. They’re introduced to the capabilities of talented, proficient software programmers and they are just blown away. Thus, they set their expectations on a level that simply isn’t feasible—or practical.

Outsourcing a software programmer isn’t the same as hiring a magician—they can’t just conjure the exact app you imagined from out of thin air. Vague ideas and generalized concepts are good starting points, but you need to add details and specifications if you want the app to actually work. Ergo, when hiring a programmer, don’t just describe what you want, pay the fee, and then expect something amazing.

Failure to Understand the Scope of the Project

You must be clear about your outsourced project as many companies tend to have their views and ideas which can’t possibly happen without all the information. Some companies release small snippets of information, in fear of a vendor knowing too much. A lack of a full picture leads to an unsatisfactory product.

Fears are understandable no doubt, however, to please both parties, non-disclosure or non-compete clauses protect confidential information as well as the competitiveness. As a client, you would always have the right to include protection of intellectual property in your contract, and companies can then adhere to this accordingly. There should be no excuse to share the full scope of the project with us, as without it, we wouldn’t be able to assign the appropriate skill set to reach your required expectations.

Code quality challenges

Determining whether the outsourced development team is adhering to the quality standards while coding your application is a challenge that becomes amplified when you work for or run a non-tech firm without significant coding expertise. Code quality is an ambiguous term because there are arguably no strict definitions for high quality and low-quality code.

Code quality is a collection of attributes that need to be communicated with the outsourced development team. In my experience, good code needs to have two key qualities: clarity and maintainability.

Well-documented and well-tested code that follows the formatting best practices and coding conventions of the programming language the application is being written in is crucial for long-term success and bug-free execution (or as close to bug-free as anyone can reasonably expect. You can’t squash em’ all.)

Maintaining code quality when outsourcing development to offshore teams requires communication of expectations, laying down the quality benchmarks in advance, and regular briefings with the team to stay on top of the development efforts.

The team that you are outsourcing to should have checked in place to ensure consistency in code quality.


Outsourcing provides the means to meet up with demands for software creation and updating it. Notably, it is the reason why it’s not a one-off project but rather a recurring long-term process. Your option of a software vendor or agency requires a lot of deliberation and careful choice. A good vendor should see your line of vision and be willing to help you achieve it.

While there always will be software outsourcing challenges and difficulties on the way to a successful project, just like in any other business, the benefits of it exceed the risks for many companies. A well-skilled dedicated software development partner can ensure faster, cheaper, and easier development of your project.

"Outsourcing Software Development: 5 Common Risks" by Gimena Aguerreberry is licensed under CC BY SA. Source code examples are licensed under MIT.

Photo by Daria Nepriakhina.

Categorized under software development.

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