I think we all noticed that the COVID-19 pandemic has accelerated the digitalization of remote working these days. Moreover, many people that have barely thought about going remote, now due to the lockdown found remote working more comfortable, less stressful, and less time-consuming.
As a result of the lockdown, business owners have adopted the flexibility to orientate on the digital level, which seems one of the major ways of coping with the fierce competition. One simple example is billboards. People spent millions on advertising their businesses in big cities. As there are no people or very few on the streets because of the lockdown and business crisis, transferring those billboards into the virtual world is the ultimate solution to survive. In this perspective, the demand for software developers has become insane. Although software development outsourcing has never surrendered, it has also become more popular these days. Due to the international business crisis companies started searching for more budget-friendly alternatives to custom software solutions, which is obviously offshore software development.
In this article you’ll learn about:
1. The benefits of software development outsourcing. Where should you look for high-quality software development vendors with competitive prices?
2. Why should you choose custom software over open-source?
3. The type of business crisis you may have been facing during the COVID-19 pandemic
4. The possible software solutions that you can implement to bypass the problems with minimum up to no losses
What are the major benefits of software development outsourcing?
● Money. Hiring the right software
development vendor from the right country will help you kick your business off
with a minimum budget up to cutting off 20-25% of your expenditure. The
additional expenses may include: hiring other professionals besides the developers
(QA specialists, project managers, UI/UX designers, etc.,), paying taxes, day-offs,
training sessions, etc.)
● Time. If you hold a nice communication with your software development vendor, you’ll finish the project faster and without additional costs. For more information about effective communication between software development vendor and client check my previous article.
● Responsibilities: Some organizational tasks are dropped out of your shoulders, such as finding new developers if there is a need, holding control of the team’s work as the team will most definitely have a tech lead, making sure the developers are well qualified, and more.
In addition to this, make sure you choose the right countries for software development outsourcing because these benefits don’t relate to all countries out there. We’ll study Armenia later in this article, as an example of a good country for software development outsourcing.
Why should I choose custom software over open-source?
The operation levels are different for various companies. Each company’s audience is targeted according to its sales strategy. Some businesses prefer to work on a comparatively low level and target a smaller audience while others work on the worldwide level and target the worldwide reach. The types of software are usually based on these operational levels. However, one thing is common for the whole business world, tailor-made software facilitates the operation and regulation of various companies according to their requirements. It helps them effortlessly provide a consistent, steady flow of value to their customers. It meets the objectives of companies that provide services, products, or have the sole purpose of acting as a mediator between the client and the service provider. The key values of custom software include:
● A process-centric method for businesses that often proves to be much productive.
● Tailor-made software for internal use is always exciting for the employees, plus psychologically it conveys positive feelings of security, capacity, and convenience.
● Custom software for external use gives more trustworthiness and seriousness to the company that uses it. Psychologically customers believe the effectiveness of its services, their importance and it may even have a positive impact on explaining your rates. For example, let’s take two e-learning and education management companies. The first company offers a wide range of EdTech solutions, has its own unique design and tools, which include:
o Learning management systems for:
· Training sessions and E-learning assessment tools
· Online meetings and virtual classrooms
· Issuing reminders for recording sessions, audit-proofing, improving content availability, etc.
· Intuitive user interface and LMS navigation platform, etc.
o Virtual classrooms for videoconferencing, instant messaging, breakout rooms, online whiteboard for live interaction and collaboration, tools for participation control.
While on the other hand, the second company has just an informative website, offers its online classes via open-source video conferencing and chatting tools, organizes the whole learning process on various social media platforms. As a user, which company will you take more seriously and would like to proceed with? Almost 90% of the potential customers will rely on the first one which offers tailor-made software and is more user friendly and easy for remote learning.
Ultimately, if you’re just thinking of implementing custom software here are some useful solutions that you may take into consideration:
You can start by building an MVP (Minimum viable product). MVP can be a great solution to test your tailor-made software. It’s an early version of custom software. Its main aim is to ensure that the product’s vision and strategy are aligned with the market needs. At this stage, it’s crucial to know that MVP only delivers a limited functionality to appeal to early-adopters. A typical example is a SaaS application.
At first, it may seem that paying a certain fixed amount of money every month and installing open-source software is a great and beneficial solution for the business. However, a custom software solution cuts off a lot of time spent on employees’ training sessions and fixing technical issues meantime it’s better to pay once and for a lifetime. On the other hand, a qualified software development house provides maintenance and support after the end of the project.
Scaling a company’s custom software according to the complexity of its business processes is proved to be much easier and secure rather than wasting time on incurring costs on additional licensing and subscriptions for more features/functions for ready-made software. Regarding security, it’s obvious that hackers are more attracted to leaking or accessing the secured information of a noticeably high number of companies. So, they’re prone to attacking open-code software that includes more information about multiple companies. By using open-source software you make your company’s privacy, ideas, and projects more vulnerable and prone to hacking.
Where should I look for a reliable software development vendor?
Now as you know that offshore software development will most definitely help you overcome the business crisis, let’s filter out a good country for software development outsourcing as it’s equally important. There are some popular outsourcing destinations such as Ukraine, Poland, the Philippines, and Armenia. The latter may be a bit less popular among other well-known countries for software development outsourcing, but it’s rapidly growing and has already positioned itself in the international information technology and software development industry. The thing is this country is a small landlocked country, with little population. Consequently, it has relatively fewer software development vendors which may be a reason to miss it out of the list of top countries for software development outsourcing. However, it’s undeniable that Armenia is becoming a top-notch destination for the world.
There are several reasons why the Armenian IT sector is much developed but is also able to offer competitive prices. Let’s go over some of the most important points:
1. The cost of living is much lower in Armenia resulting in relatively lower wages, costs of products, services, etc.
2. The IT industry is under state sponsorship. Software development companies get such priorities as lower taxes, (sometimes no taxes), free training sessions covered by the government, and more.
3. Developers are much open to cross-cultural communication and easily adapt to various countries or nations’ specific working routine.
4. International companies choose Armenia as an offshore state for establishing their branches. Thus, employees are very flexible in communicating with people from various backgrounds.
5. Developers’ language barrier is set to the minimum, while other workers in the organizational, marketing, or sales departments speak perfect English sometimes with other accompanying languages.
6. Armenia has a variety of tech stack.
The below countries are the most active ones in hiring remote software development teams in Armenia. Let’s compare the rates.
Software development hourly rates per areas
Western Europe: Netherlands, UK, Belgium, France, Norway - $110 - $300
East and South Asia: China, Indonesia, Malaysia, Vietnam $30 - $100
North America: USA, Canada: $150
Australia, New Zealand: $100 - $180
The South Caucasus region (Armenia): $20 – $50
In addition to this diagram, I would like to mention the GCC countries, which are becoming more open to remote software development outsourcing. This process has especially been accelerated due to the COVID-19 pandemic.
Now, about the pricing. Armenia is providing much lower rates (almost 10 times in some cases). So, that makes sense why some successful companies open their branches in Armenia or hire outsourcing software development teams from Armenia. Why shouldn’t they save money and invest in other fields if there is a possibility?
Note: Some companies in well-known countries for software development outsourcing sometimes provide such low rates that are out of the market competition. The problem is I would not advise concentrating much on the maximum low rates. It’s one thing to be able to provide affordable services based on beneficial factors and it’s another thing to have incomprehensible low prices for custom software. This may speak about service quality. So, please note that the above-mentioned benefits are related to appropriate companies with logically low software development services.
Summing up the above reasons, let’s move to the most common types of business crisis during the COVID-19 breakdown and learn about the top-notch software solutions that were used to overcome the crisis. Be aware, there isn’t a whole list of custom software solutions in this article. I differentiate and sum up the most useful and common ones based on our experience during the COVID-19 pandemic at CodeRiders. You’re always welcome to reach out for more details.
Please also consider that the below enumerated most common custom software solutions can also be implemented by an in-house software development team anytime however you’ll not gain my earlier mentioned benefits.
1. Financial Crisis
A financial crisis occurs when a business loses its assets and can’t afford to pay off its taxes, employee’s wages, debts, etc. For example, a company has 15 clients that ensure this company’s stable revenue and cover other expenditures. Now, suddenly 10 out of these 15 clients terminate their partnership while others cut off their requirements. This causes a significant drop in demand for the product and services, and the company faces layoffs and furloughs to stay afloat. To overcome this issue, the company management starts aggressive sales and marketing campaigns. It aims at filling in the leakage of customers and partners. Meantime provident and prompt steps of skilled administration and management can bring business back to life. If you’ve ever met such a situation, you may also experience “obscure” strategies that may be implemented by the decision-makers.
Investments in a certain area while the business is under the strain may sound bizarre, however, it’s proved that “money brings money”. If we look at this problem from the technical point of view, the following strategies are the most welcomed by the decision-makers: new tailor-made software, signing a contract with an offshore software development team, or implementing additional features to your already existing custom software. I’m not insisting that this is mandatory for all businesses. It depends on the type of business you’re in and what specific financial issues you may encounter. However, redesigning or refreshing your business is proved to work in a crisis. It’s quicker to orientate in the virtual world which has limitless opportunities. Good targeting in a good market will close deals. However, as a business grows it’s eventually requiring more proposals.
For example, the COVID-19 pandemic caused a financial crisis in the following industries which eventually started looking for virtual opportunities.
The same has happened to almost every industry as I mentioned. For more details regarding various software solutions in specific industries, I suggest checking our industries section.
2. Organizational Crisis
An organizational crisis occurs when a company uses its customers as a means of withholding information or misusing the power of authorities instead of building mutually beneficial co-operation with them. Misconduct, job malfunctions, and poor communication between the in-house team and employees are also considered as part of an organizational crisis. To overcome these issues, tangible and productive systems should be implemented. These solutions will support both employees and customers. Customer care and support solutions, strategies towards restoring the company’s reputation should be considered. Such a crisis isn’t connected with finances but rather demands highly skilled professionals to bring back their customers’ trust in a short period, as well as restore harmony in the office life.
According to our experience at CodeRiders, working with likewise companies, the following software solutions are most definitely able to solve these issues:
Custom CRM system: Custom CRM systems are settled on your unique business needs. Open-source CRM solutions have designs that usually fit inconsistency with the basic business prerequisites. This means that there are usually a lot of features and functionalities that are useless for a specific business. This is logical as open-source developers do their best to fulfill the needs of any type of business. As a result, you’re often overburdened by an extra cost outlay meantime having those useless features that only hinder your company’s progress.
On the other hand, unlike open-source CRM, your custom-made CRM system makes all the vitally important tasks of your business highly automated, allows concrete and reliable business analysis, data migration, user training sessions, support, evolution, and much more. These aspects are extremely important if a business is in a tense situation, especially if the crisis is connected with its reputation. Such solutions only accelerate the recovering process with a specific strategy and provide positive results.
In case of a major turmoil in the company’s administrative and organizational departments,
enterprise resource planning (ERP) software is another possible solution. ERP
software collects all the employees’ tasks on one platform and makes the labor
hours much viable, less stressful, with more virtual and productive
communication between the employees and the customers (depending on the type of
software included in the ERP). It’s obviously less time consuming and
productive to gather your team on one platform and cut off the time spent on
going from one office to another. This is especially helpful for remote team
management. Certain types of software that may be included in ERP systems are:
ü CRM (Customer relationship software)
ü Inventory management
ü Payroll management
ü Reporting and analytics
ü Logistics and Supply chain management
ü Project management (Financial and procurement management)
ü Product lifecycle management
These solutions can also be implemented individually to overcome the organizational crisis in the company. For a detailed analysis, we should consider the type of the company, its working style, and the specific issue that it’s facing.
3. Technological Crisis
Nowadays a few companies can survive in the fierce competition without implementing innovations and adding exciting opportunities for their customers. Software solutions are always welcomed in any company regardless of their industry. Meantime they often refresh the business and add new leads. However, unexpected technical problems such as a sudden break down of the servers, scammers’/hackers’ attacks, leak of information will lead to a major loss of revenue, as well as hit the product or service’s reputation. This crisis occurs when a company already has its own system/software or uses unreliable open-source software. In both cases, the problem should be identified by the software development experts to fix the problem or to implement a new custom software solution.
If the company doesn’t have an IT team or a permanent software development vendor, it should start searching for the most relevant one. If you want to explore tips for finding and holding good communication with a software development outsourcing team, I suggest reading my article about effective vendor management in software development outsourcing.
To sum up, all businesses have ups and downs throughout the business development lifecycle. Identifying your issue/crisis on time and taking corresponding actions are the keys towards the rebirth of your business. Custom software development is a great solution for the refreshment and re-organization of your business. Moreover, tailor-made software can help companies overcome difficulties during a business crisis. On the other hand, software development outsourcing can be the ultimate solution for implementing affordable custom software in a short period. To succeed in this, you should be aware of the tips for finding and holding good communication with software development vendors, as well as know the unique features for offshore software development including the favorable countries for software development outsourcing.
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