Differences between Software Factory and Own Developers

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One of the main uncertainties that business development managers have is whether to develop the necessary software for the company with its own equipment or outsource the development.   Here are 10 questions that, depending on the answer, can help you make the right choice:  

 1. Are there enough development needs in your company to justify a development area? If the answer is, you do not have to evaluate the financial cost involved in the compensation of your employees when you do not need them.

 2. Do you currently solve with an engineer who does all your programs? What happens if that person migrates from work? Or sick? It is an unacceptable risk that puts the entire business at risk depending on an individual or a couple of them. 

3. Is the technology area the core of your business or a business support area? If technology is your core, you should think that being a strategic one, this function resides internally, but if the systems area only supports the business, there may be very competitive options in price and quality in the market that you should evaluate.

 4. Do you have the necessary functional analysis, development and Q&A specialists in your company? Efficiency in system development based on industry best practices suggests that your functions are clearly defined. It has been known for years that the one who does not control, if you do not have the capacity to have all the necessary roles is a good time to outsource.

5. Are your software updated technologically speaking? Supporting obsolete software technologically speaking can be much more expensive and risky to maintain, precisely because of the shortage of professionals who want to continue with these outdated technologies. Or you change all your equipment at a high cost or outsource the development.

 6. Are your methodologies current? If you are still using outdated methodologies such as Waterfall, it is a good time for you to look for an external provider that dominates Scrum to give agility to your area and that can accompany the needs of the business. 

7. Would applications be necessary for your business? If your business requires the development of Apps for its commercials and its customers and your people do not know the necessary technologies to do it, it is a good time to evaluate the Software Factory model. 

8. Is your business so specific that you used up existing solutions in the market? We always have the tendency to believe ourselves unique in the market, but this in 90% of cases is a fallacy. If your business is not from a specific and sophisticated niche, you will most likely find in the market solutions that with small adjustments can serve your business.

 9. Does size matter? In past times the power of a manager is mediated by the number of employees in his area, currently what is valued in companies is operational efficiency and support to the areas that generate economic resources. Large teams are large expenses and financial costs growing every month for potential workers’ compensation.

 10. What does the CFO think? At present, the man of finance tries by all means that the ROI is adequate, outsourcing the development implies passing that budget to OPEX. Talk to your financier and you will see how happy you are with that strategy.   

  As you can see there are ways to evaluate whether it is convenient to develop with your own team or outsource your developments with a software factory, that depends on you. However, it would be wise to know that the other managers or directors are looking at your management and not using the current optimization tools not only your area but your position is in danger.

Marcelo Arrabal

Marcelo.arrabal@tbs4latam.com

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