In December 2017, we had a client (let’s call them XYZ Inc.) that came with a fairly complex application request that was linked to a set of tight deadlines. The client had just acquired a large e-Learning platform, and they hoped to lead the acquisition with a math test application that they could launch in the middle of the summer.
In this case (which is not always the case for Freelance Web Content Writer customers), the customer knew exactly what they needed when they met with one of our sales managers at a trade show, and immediately began asking about details, instead of generalities. XYZ Inc. had already calculated the number of developers they would need (spoiler alert: needed 20 resources in total), the amount of time it would take for that number of developers to schedule over 2,000 math problems, and the programming language that would be better juxtapose your project.
The client carefully considered the context, deadlines and costs, and knew that it was more suitable for outsourcing development, rather than trying to incorporate 20 developers for a project that was not ongoing. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients. When deciding to proceed with outsourcing, the client went through the process of forging a symbiosis between the operational structure and commercial aspirations to determine if their business was better serving internal positions or with a third party such as Freelance Web Content Writer. They approached the old debate of outsourcing versus outsourcing with logic and comprehensive cost-benefit analysis.
The thing about outsourcing is omnipresent. It is an issue in which all entrepreneurs realize at some point in their career and apply to a wide range of processes: sales processes, marketing, e-commerce , operations, administration and everything else is not required practical intervention or physical work.
Outsourcing goes beyond outsourcing; It is sustainable and scalable, taking advantage of resources that may not be available locally through telecommuting and remote positions. Through outsourcing, Freelance Web Content Writer customers are expanding profit potential, maximizing growth and care opportunities that their internal architecture cannot support.
We will guide you through the ideology of conscious outsourcing. To begin, let’s return to December 2017.
And then this is where we are going if you want to move forward:
Before reading further, understand that each project comes with its own unique set of obstacles, cost barriers and expectations. The formula we cite in this article is contextualized for a specific customer, and the formula must be reoriented according to individual needs.
The case of XYZ Inc .: A Reminder that Numbers Don’t Lie
Step 1: Set Some Parameters
What parameters are we talking about? We are talking about difficult parameters and soft parameters, elements in which you cannot move and elements with little space to move smoothly as the project progresses.
General expenses. Deadlines. Design.
Conscious provisioning is a means to concentrate on the right task, the right cost and the right resource, and if you can’t define the task, describe what qualities the perfect resource has or plan your budget, it may be time to stop until Your vision crystallizes.
When we met XYZ Inc., they had intricate and mental plans of the parameters of their projects, and were able to completely verbalize their needs.
In a summary version, XYZ Inc. told us that they needed a new math application, and the development of that application was critical to their current business strategy. They intended to boost sales, gain visibility and boost growth by presenting this application to their pre-existing e-learning suite. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients.
For XYZ Inc., the mathematical application would represent its first win after a period of brand change. Therefore, they recognized that they needed to give their best, delivering a product that would establish them among competitors and embody the specific qualities of the brand that would later be perfected.
Our sales team member left the conversation with a list that looked a bit like this. XYZ Inc. wanted 18 Java developers and 2 resources to perform quality control for a scheduled application with more than 2,000 algorithms, and they needed it stat.
The different check marks set the parameters for the XYZ project. When searching for your project, you should make a similar list. Setting parameters helps you address the next debacle: insourcing vs. outsourcing
Step 2: Insourcing Against Outsourcing: How much to hire a Java developer? 18 of them?
The parameters help to establish the limits of the project, and for most, there is a parameter that always stands out, is underlined and highlighted in the project plan: budget. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients.
Much of the time, the supply debate finds its resolution right here, in a conversation about financial constraints and cost / benefit analysis.
It is no secret that outsourcing minimizes development costs by 25-75%, but I think there is a misunderstanding of how much money is actually saved in practice.
The XYZ project needed 18 Java developers, the internal incorporation of 18 resources is an arduous commitment for any company, but especially to complete a single project with a static stop and start date.
Freelance Web Content Writer investigates aggregate salary statistics from three different employment databases to corroborate the outsourcing / outsourcing costs division:
22,302
Salaries
3
Career Entry Points
3
Employment Databases
Between Glassdoor, Indeed and PayScale, Freelance Web Content Writer evaluated 22,302 salaries for Java developers. We collect data from three career entry points: entry level, mid-career and senior / expert level. In fact, it generally gave the highest estimates for Java developers’ salaries, while Glassdoor maintained its modest estimates.
We use these numbers to calculate Java’s average salaries at the three career entry points to illustrate the base salary. XYZ Inc. would have to pay each of its 18 Java developers, if they had chosen to submit their e-learning application.
Let’s say that XYZ Inc. decided to hire 18 Java developers mid-career internally with an average salary of $ 66 k / year. Insourcing The XYZ project would cost more than $ 1 million for base salaries alone.
This does not take into account employment taxes, recruitment expenses, benefits and the cost of space and work equipment. SHRM estimates that recruitment costs cost approximately 4k / hire, while MIT puts the total annual cost of employees at 125-140% of the base salary.
Okay, what would happen if XYZ Inc. modified the terms from the list of hard parameters to flexible parameters, doubling the timing of its projects to hire only half of the amount of resources?
By adding recruitment expenses, benefits and employment taxes, a single mid-career Java developer would cost XYZ Inc. $ 86,500 to hire internally. Now multiply that cost by the amount of resources. I will give you a fair warning: it hurts to look.
You’re probably thinking, okay, how much can I save by outsourcing development?
We cannot disclose the exact numbers for the XYZ project, but if outsourcing projects generally cost 50-75% less than input development projects, and if the XYZ project required resources for 7 months (December-mid summer), let’s see the Costs if the developers were acquired at 25%, 50% and 75% less than the cost of the inputs.
The budget is the elephant in the room for CIOs, CEOs and other C-suite executives who captain a ship and are doing everything possible to boost it. In the 2016 Deloitte Global Outsourcing Survey, 59% of participants mentioned cost cutting as their reason for outsourcing. So, if the cost is what prevents the ship from moving forward, the supply debate will always end with outsourced development. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients.
Simply put, outsourcing allows you to get the best performance with the least amount of fuel.
Step 3: Ask yourself, what’s next?
Obtaining your project requires a deep sense of self-awareness, a holistic perspective on the past, present and future of your commercial operation. A snapshot that covers everything constantly raises the question, what next?
This question is related to the analysis of insourcing and outsourcing costs, because although the numbers clearly deviate in one direction, they must be contextualized.
Will you need continuous development for a very small project? Does the project have a definitive deadline? Does it make sense to increase part of my staff through outsourced services? Am I willing to pay costs that go beyond the base salary?
XYZ Inc. concluded that its project would only take 7 months. If they had decided to hire and hire internally, they would still be paying a team of full-time Java developers that they only needed for a certain period of time.
Sure, they may need them again later, but until then, Java developers would have been inflating their overhead without purpose. Freelance Web Content Writer operates with a contract every time, shoots every time he keeps; Freelance Web Content Writer developers come to attack a predefined and niche task, and once that task is completed, customers pause our development services until their next project. The hiring or fire policy frees companies from contractual agreements, which avoids paid downtime and excessive overhead.
Every hour an outsourced developer works, he achieves tangible progress, but the same cannot be said of the internal work forces. In a work study surveying almost 2,000 office employees, researchers found in an 8-hour workday, employees are only productive during 3 of those 8 hours. We do not pay full-time plumbers to fix a leaking faucet or internal on-board doctors for annual checkups. So why are they doing this for software development?
If we are truly pragmatic with our supply of projects, we are finding the fastest, most efficient and profitable route to our final destination. Paying an employee with resources that is productive less than half of the hours for which they are paid, guarantees business mediocrity.
Step 4: Overcome your outsourcing bias
It’s time. We need to face the facts about IT software outsourcing.
Here are the facts:
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XYZ Inc. defined its parameters, investigated software development partners and hired 18 Java developers from Freelance Web Content Writer.
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They were released in July 2018 after only 7 months of development.
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The XYZ e-learning application allowed them to kick off after a period of brand change with a product they were proud to represent.
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They wasted no time in a recruitment process or training period because they outsourced Java developers who were ready to exceed 2,000 programming assignments of mathematical algorithms on Day 1.
If XYZ had decided to take an alternative route, they would still be in the development phase, struggling to give their new customer base something to hold on to. They would have 18 Java developers and 2 quality control programmers who were waiting with inactive hands, and a severe budget deficit that no new version could counter. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients.
In past decades, systematic failures plagued outsourcing reputations and stigmatized third-party software services. As we move forward in the digital revolution, technology dismantles systematic failures by streamlining face-to-face and remote communication.
Remote work is a common feature today, the mainstream rather than cutting-edge video and audio capabilities. The deficiencies are inadequate since communication becomes increasingly instantaneous with increasing interconnectivity.
You can continue to hire full-time internal mechanics for a car that needs to change its oil every 10,000 miles, or you can outsource it. Freelance Web Content Writer every time the engine check light flashes red.
Disclaimer:
Freelance Web Content Writer does not affect the opinion of this article. Any mention of specific names for software, companies or individuals does not constitute an endorsement of any of the parties unless otherwise specified. All case studies and blogs are written with the cooperation, knowledge and participation of the individuals mentioned. This blog should not be construed as legal advice. We have started Freelance Web Content Writer India and the team of Rajeev to help our clients.
Freelance Web Content Writer was incorporated in 2000 and is based in Florida. We deliver World Class Software Development Solutions serving entrepreneurs to Fortune 500 customers. Our services include process and system design, package implementation, custom development, business intelligence and reporting, systems integration, as well as testing, maintenance and support. Freelance Web Content Writer experience spans the entire IT spectrum.
