How to Choose a Software Development Partner? Checklist Included

Deciphering how to choose a software development company is challenging for businesses aiming for project success. There’s a myriad of options for nearly any type of outsourced support, biased opinions both internally and externally, and if your company’s reputation and growth depend on the quality and the suitability of the final deliverables, there’s added pressure to get it right. We get it. 

Determining the best criteria, or shortlisting the right questions to ask potential vendors is critical to inform such a decision. That’s why our experts have prepared a detailed guide to help you make the right call and hire a software development company that walks the talk.

Make sure that outsourcing your project to a software development partner is what you really need

According to Deloitte, 76% of all companies turn to software partnership to get their IT solutions delivered. But as common as it may seem, app development partnership is not a cure-it-all solution. It’s a strategic decision made for very specific reasons.

Innovating new products and features 

In 2023, the global talent shortage has reached a 17-year-high, making outsourcing an almost automatic option to secure the right talent on short notice. Digital innovators, more than anyone else, are dependent on the right available tech talent to bring new products to market.

Hiring app development partners allows organizations, anywhere on their  transformation journey or product roadmaps, to tap into on-demand technical and subject matter expertise, as and when needed. Software development partners allow companies whose in-house specialists do not have the required technical or product skills or capacity to deliver innovation sooner. 

Giving clarity to projects with vague requirements

Most often, companies have a product vision (albeit, often half-baked) but don’t see the path to its implementation. Reaching out to an experienced software development partner is a great way to eliminate requirements ambiguity and put your project on the right track from the get-go.

As a rule, software development companies offering innovation services pay special attention to discovery, an early stage or couple of practical steps focused on laying out your project scope, requirements, cost, and all the must-haves for successful delivery. So if you lack clarity in your journey, it’s better to have a partner with a savvy discovery capability to steer you in the right direction.

Slashed operating costs

Over 55% of companies view outsourcing as a cost-reduction play and for a good reason. With outsourcing, you can forget about the costs associated with recruiting, training, paying salaries, and providing employee benefits including paid vacation and sick leave, while ensuring that at least part of your IT infrastructure is covered by an experienced software development company.

Most importantly, the strategy of outsourcing may help you reduce the cost of software and data projects by 30% – 50%, given the right partner.

Scalability and flexibility

A good software development partner has developer talent on tap, with an ability (and willingness) to flex team sizes up and down as demand fluctuates. With this “flex-capacity”, you can scale up your  team with outsourced talent and  scale down once the workload is completed without the additional costs and fallout associated with in-house termination.

Faster time to market

A company can also leverage outsourcing to accelerate the delivery of a new product. Ideally, the combination of fast hiring and a full-cycle software development process reduces the time to market, without compromising quality. A good software development partner for innovation-related work should articulate and demonstrate a mature, yet practical approach to quality assurance throughout the entire digital product life cycle.

Avoid the pitfalls of software partnership

There’s one thing you need to understand: outsourcing can fail. The root cause is often traced to the fundamental way companies view and discuss product development from the onset. Instead of prioritizing a product concept, businesses rush straight into outsourcing software development. However, the right approach includes laying the groundwork for a product’s success.

Share your product vision. The more info, the better!

Before deciding upon a software development  partner, it’s vital to determine the essence and long-term mission of a product. In other words, communicate the “why” behind your product, including:

• Your company’s core motivation (mission, values, and backstory) 
• Key product information like target customers, needs, key benefits, and differentiators
• Information on your business model and insight into any changes
• Important or fundamental technologies, methodologies, and protocols

Sharing your product vision early and widely can help you get off on the right foot with an outsourced software development partner.

Determine the rough project scope

With an idea of your final destination, you should then lay out the rough scope of the project to begin identifying the requirements and needed resources. We recommend documenting and sharing the prioritized or at least the must-have features of the first product version completed with the new partner. To do that, you need to create a list of features based on user flows.

During the Discovery stage, your software development outsourcing company should have the capability to help you specify and prioritize your project scope. But having something to start from will help set the tone and accelerate development.

Set a preliminary budget

Surely, within the Agile software development life cycle, budget estimates evolve as the outsourcing partner gains a deeper understanding of the product with each iteration. However, you should allocate a specific budget before choosing a software development company if you don’t want to work in the dark.

To calculate an optimal amount, you can benchmark your product against similar products in the market and then ask a few development companies for a ballpark estimate.

Plan an approximate timeline

Again, after you reach out to a reliable potential tech partner, dedicated project management should be proposed with a project-specific timeline with all the deliverables laid out in chronological order. Sharing approximate start and end dates of your project and overall expected engagement duration with potential partners will help you align  your overall business and marketing strategies, reaping the benefits of client-provider partnership earlier.

Get stakeholder buy-in

After articulating the strategic importance and documenting a description of the work as best as you can, seek executive sponsorship to back your initiative. You should engage stakeholders early in the process and ensure they’ve bought into a shared vision and understand the scope of the project and amount of support they’re asked to provide, in money, time, and attention.

Measuring the potential ROI is a great way to win sponsorship and defend your initiative from competing interests. 

Having a well-defined vision, limited scope, preliminary budget approvals, timeline guidance, and a thorough and credible ROI calculation will win stakeholders who not only sponsor your initiative, but support your decisions to execute an ROI model which may itemize outsourced software engineering help.

When in the market for any needed software development assistance, especially if the work is related to digital product innovation, look for a partner who requests the information and offers upfront consulting services to cover any gaps in project readiness. 

How to choose the right software development partner? 7 steps to collaboration success

When the plans and sponsorships are at a good place, it’s time to finally start looking for a software development partner, and you might like a step-by-step plan to guide your search. That’s why *instinctools’ experts have assembled a list of steps to help you choose a reliable software development partner to transform your business ideas into winning products.

1. List down companies

Assuming you have already got a solid grip on your requirements and timeline, the next step will be to find a team that matches your specs. To locate a trusted software development partner, you can use the following resources:

• The fastest and easiest way to find a prospective software development partner is to scour the Internet. With the criteria identified, you can shortlist potential companies that meet your requirements. 
• Peer into professional listings. International and local directories can give you a better idea of reliable software development partners, their experience, average rates, and industry focus. These platforms help you cast your net and narrow your search at the same time, as you can hand-pick companies based on budget, industry, tech stacks, and more.
• Browse through your connections on professional networks. On LinkedIn, you can ask around for references or reach out directly to prospective tech partners. 
• Networking events, exhibitions, and conferences like Web Summit, Mobile World Congress, and others are great places to come across like-minded partners for your business.
• Attending the workshops at tech-focused meetups and hackathons will help you to see your potential development partner in action and have a closer look at their skills.
• Referral networks and word-of-mouth recommendations can also be a great way to find a team that has been recommended by a company you trust. 

2. Choose a location where to hire a software development team

Once you have a list of potential software development partners, you need to trim it down and group the vendors by location. Choosing the right outsourcing location is an important part of the outsourcing strategy. The decision as to where to go hinges on the following factors:

Available talent pool

In top-dollar locations, you can run into stiff competition (which suggests higher costs of hiring) or distance yourself from target candidate pools. Conversely, countries with affordable cost of living have more diversity in their demographics, which leads to more concentrated pockets of talent.

Cost tolerance and quality of services

Although your knee-jerk reaction might be to hire the cheapest software development outsourcing partner, it’s not the affordability that makes your collaboration valuable. It’s the cost-value ratio that should guide your selection process. Therefore, you should look for software development firms with a cost-effective pricing model and a proven track record of software development services.

According to TalentUp, Poland offers the most affordable developer talent in the EU with an average yearly salary of a bit over €​​30,000. Paired with a high level of services, this location might be your destination for software outsourcing.

Time zone

A significant difference in time zones can complicate communication and even derail your project. However, similar time zones allow you time to collaborate and align on projects without delay. Therefore, choose outsourcing locations with at least 4 hours of time zone overlap so you can easily find windows of collaboration.

Culture

Cultural harmony means that the standards and values of your company align with the ones of your potential software development partner. Cultural compatibility also includes having similar business practices, work ethics, social norms, and communication styles — everything that makes your software development partnership more comfortable for both sides.

English proficiency

Staying on the same page is impossible if both teams don’t speak the same language. That’s why you have to make sure software developers have a good command of the English language. Countries such as Poland, Romania, and Bulgaria boast a high level of English proficiency and pocket-friendly rates.

3. Evaluate work methodology

You need a partner, not a project-doer. So next up is making sure the work approach of your software partner aligns with your project requirements and company culture. A good partner’s methodology should illustrate how the company, not their individuals, will support innovation across the long term and achieve your product development outcomes short term. 

A trustworthy software development partner has development approaches published on their website. Agile development practices and other modern software development frameworks such as Scrum and Iterative Incremental model are considered the gold standard for building quality digital products.

4. Verify expertise and experience

The best software development partner has everything your company lacks in terms of tech expertise. Look for fits in technology skills, experience building similar functionality, and industry experience. 

You can get an idea of a prospective partner’s experience by studying their portfolio, evaluating case studies, and asking for testimonials from previous clients. A good potential partner’s methodology will support knowledge transfer of any industry knowledge delta in the most efficient manner possible.

Make sure to look into the complementary skills and knowledge that might be valuable for your project. If you’re good at hatching ideas but not so good at their execution, you’ll need a partner with a vast toolbox to find an optimal way to realize your vision.

5. Explore cooperation models

The specific nature of your project is the key element you should consider when choosing an ideal engagement model. Project scope, certainty of the output, level of involvement, and the agenda differ from model to model.

	IT staff augmentation	Dedicated team model	Offshore development center
Purpose	To cover talent gaps and accelerate project delivery.	To find a development team with a single focus on your project and its full ownership.	To develop large, complex, and compliance-heavy projects at a lower cost.
Scope of work	Fixed	Flexible, dynamic	Flexible, dynamic
Level of involvement	High	Up to the client	Little
Product and project management	Client	Vendor	Vendor
Operational oversight	Client	Vendor	Vendor
Main benefit	Reinforcing your team with industry experts	Having your product developed from ideation to delivery	Having a team of experts offshore as an extension of your own organization

6. Get a quote

Now, it’s finally the time for a money talk. When asking for a bid, avoid basing your decision on a generic rate card and seek a specific quote. The right software development firm will help you make key early decisions, provide insight while doing so, and provide you with an executable proposal that includes major terms, price, and timeline estimates. Now you can refine your ROI model to more accurately forecast the expected return and to support your decisions throughout.  

Most software development partners work according to the Fixed Budget, Time & Material, and Dedicated team outsourcing contracts. Again, it’s the case of different strokes for different folks so revisit your project specifics.

	Fixed budget model	Time & Material	Dedicated team
Project size	Small and mid-size projects, MVP	Any type of projects	Medium, large, long-term projects
Project requirements	Predefined	Not set	Evolving
Flexibility	Little	High	High
Budget	Fixed	Estimated	Estimated
Client’s control	Little	High	High
Timeline	Fixed, but extendable	Predefined, but extendable	Predefined, but extendable
Scalability	No	High	High

7. Investigate market reputation 

No matter how heartfelt slogans on your partner’s website might be, you should research their background and reputation to double-check the quality of the services. No company would want a partner who always misses deadlines or is not polite to work with. 

Before sealing the deal, read first-hand testimonials from their previous clients on Clutch and GoodFirms or connect with a few of their past clients. We’ve deliberately listed this point last because you’ll have better questions for a potential partner’s referrals at the end of your research journey.

Revealing red flags in a software development partnership

Here’s the deal. Any company, good or bad, tries to make an irresistible first impression on anyone who passes by. However, you need to see past an impressive client hall of fame, numerous accolades, and bold promises. Below, we’ve outlined early signs of trouble that might make your project go downhill.

Size mismatch

A good development partner should be small enough to care and big enough to scale. Therefore, you should steer clear of partnerships with big (1000+ employees) firms. Their often-rigid structure and broad focus might overlook the specific needs and nuances of your project. On the other hand, if the company is too small, you might have trouble scaling or developing a large-scale project. 

Cost-over-quality approach 

Be cautious of companies that make low-priced offers, significantly lower than the market average. Underbidding can be indicative of compromised quality and a lack of the specialized expertise necessary for the success of your project. Therefore, it’s best to focus on value for money rather than grabbing the cheapest deal.

Jack-of-all-trades claims

There’s a big difference between a can-doer and a jack of all trades. If the company seems too eager to reel in a new client, they’re either rookies or too desperate to land a project, any project. Either way: you and your product lose.

Therefore, avoid partners who claim to have a decade-long expertise in all technologies. This overreach often results in a superficial breadth of knowledge, lacking the depth required for your specific technological needs.

Failed credibility check

Lastly, consider the visual cues you see on the website of your potential partners. Subpar websites, generic testimonials, and ambiguous portfolios often point to a lack of experience and credibility in company roles. The same goes for companies that put your project in a black box from the very first engagement, giving you evasive answers about the prices, experience, and business processes.

A tech partner worth their salt never operates behind a magic curtain. They are loud and proud of their track record, relevant experience, and terms of cooperation. Trusted development companies also have a clear understanding of who they are as a company. Otherwise, you might be dealing with a vendor that’s going out of business.

The problem of hiring a software development partner, solved

In 2024, your business can’t afford bad software. That’s why you need a trusted software development company to have your back. Although there’s no magic formula for choosing partners, such particulars as project development cost, wide experience, a proven track record, and a favorable location should be among your main selection criteria. 

When choosing a software development partner, especially for innovation, it’s important to consider data points outside of the hourly rate. If you dream big and plan small, you realize ROI beyond any model or spreadsheet.

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