Maximizing ROI through Software Outsourcing

There is a paradigm shift in the way businesses were conducted some decade and a half ago. A number of factors have led to this change; however the foremost one is the way in which politics have changed the course of economic development. Globalization has made our economies interdependent, wherein resources of one nation can be procured for research and development of the other. This trend as we all know is outsourcing, a strategic business decision to usher in resource optimization and cost effectiveness.

In a highly competitive business ecosystem, quality has preceded any other consideration. At the beginning outsourcing was considered as a viable option to minimize overhead cost that came with hiring and managing in house resources. However, with time the rationale behind the outsourcing has changed. Today, it is regarded as a strategic business decision that promises the procurement of quality resource at a compelling price point. Despite many advantages of outsourcing, there is skepticism attached with it. The most obvious question is how to maximize ROI (Return on Investment) through outsourcing?

With the global onslaught of IT in every walk of life, there is no surprise when Forrester Research, an independent technology and market research firm reported that $2.1 Trillion worth of money will be spend on IT in the year 2013 alone. The same report also suggests that besides IT consultation and hardware resource, major spending worth $511 will be on software development.  In the past few years the realm of software development has seen some major developments.  Heavy resources and money is being pumped in cloud technology, mobile app development, big data management and analytics.  In fact the overall investment is software development will rise from 3.3% in 2013 to 6.2% in 2014.

Owing to the promise that the software development boasts off, the outsourcing trend is likely to become more intensive. This year alone, as much as $411 million shall be spend on outsourcing for varied services namely network, infrastructure, hosting, application development and maintenance.  Among these categories, the highest spending will be on app development which is an integral part of software development.

Outsourcing has bestowed several advantages to Small and medium sized enterprises in last one decade. Savings and procurement of requisite skills are the two biggest attraction of outsourcing.  An onshore enterprise can save up to 60% of development cost and other forms of overhead such as HR, infrastructure and maintenance. Additionally it also minimizes risks and saves time.  Besides leveraging ROI by nearly 30%, outsourcing also lays down the advantage of customer value and extends a competitive edge which assures quality.


Leave a comment