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How To Outsource Software Development Projects The Right Way

Tapan Patel

Oct 21, 2020

9 min readLast Updated Jan 23, 2023

Outsource Software Development Projects

Suppose you have a great software idea and you want to build it as soon as possible. aren’t a developer. Or maybe you don’t have the bandwidth to build the entire project by yourself. So you decide to hire a software development company and tell them about your great idea. Fast forward to the day of delivery, you realize the vendor’s definition of “great software” wasn’t the same as yours. A whole lot of resources and time went down the drain! This is why it’s important to understand how to outsource software development projects the right way.

So how to do it, what’s the right way?

Well, the right way begins with understanding your own software development requirements first. Scoping your software project helps you gauge what you need from your outsourcing partner.

Preparing a detailed software development plan and project scoping document forces you to put your idea on paper. Naturally, it will be much more accurately communicated to the vendor than a mere exchange of words. If you religiously follow the project scoping process and put in the time to write all the sections, your chances of successful software development are much higher.

How to scope your requirements before you outsource software development projects

Generally, software project scoping is a very tedious task if you are responsible for the whole product development life cycle. However, as a business, you don’t need to dig very deep. You can just provide basic details and hire a software development company to take care of the rest.

As a client, you should take the following steps to scope your project before you hire a software outsourcing company:

Step 1. Frame a detailed product strategy

product strategy

In order to outsource software development projects the right way, it’s vital to draw a product strategy.

A product strategy is a carefully vetted plan about what your business aims to achieve through its product. More importantly, it chalks out the steps you will take to realize those business goals. It’s a very detailed document that should provide answers to:

  • Who are your intended buyers and what are their characteristics?
  • What value will they derive out of your product and how will you facilitate it?
  • What are the goals of your business throughout the product development life cycle?

Key elements of a product strategy

key elements for a product strategy

A product strategy is incomplete without the following key elements:

Product vision statement
A product vision statement outlines what your product (or company) aspires to be known as in the long run. It’s vital that you spend a lot of time developing this statement because you can’t (and you shouldn’t) change your long term vision after you have begun product development.

If the vision statement is not static, product development will not be consistent or efficient.

For example, Google’s vision is to provide access to the world’s information in one click. It has stayed the same since the company’s inception and that has helped Google stay focused and keep growing in that direction.

Now that you know what you want to accomplish in the long run, start listing down the short term goals that will lead you in your vision’s direction. These goals shape your product roadmap and guide you on how to move ahead.

Product goals will include every aspect of your business, from development milestones to revenue milestones.

Based on your goals, you will list the activities you need to undertake in order to realize your goals.

For example, if your goal is to generate $1M revenue in a year, your initiatives will include product enhancement, marketing, and sales tasks that will help you generate the said revenue.

Presenting your product strategy to your software development vendor is important. It helps the team understand how the software should help your business realize your broader goals.

Step 2. Prepare a clear Software Requirements Specification (SRS) document so you can share it with software development outsourcing companies

Software Requirement Specification

A software requirement specification document lays down the foundation for how the system will be developed. It serves as a product roadmap for all the stakeholders involved so that everyone is on the same page about the software’s features and other requirements.

Essentially, an SRS document states what the software should look like and how it should perform. Moreover, it specifies how the user will interact with each part of the software application.

How an SRS ensures efficient software development while working with remote partners

A software requirements specification document is necessary when you outsource software development projects. It eliminates any scope of ambiguity or misunderstanding amongst the stakeholders. Moreover, a clear set of requirements ensures that the software developed by offshoring partners meets the client’s exact needs.

  • The development team gets an idea of the tech stack they should use to fulfill these needs.
  • Designers can prepare their drafts based on the use cases mentioned in the document.
  • Testers will know what kind of test cases they should implement to ensure the desired software performance.
  • An SRS serves as the most informative piece of a proposed product to present to potential investors.
  • Both the client and the development partner will be able to estimate the timeline and budget more accurately.

Essential elements of a good Software Requirements Specification document

Generally, when a software development company prepares an SRS document, it’s a very detailed plan outlining every single task. However, you, as a client, only need to present the information that will help you outsource software development projects the right way.


The very first thing to mention in your SRS document is the purpose of your product. Clarify what problem the product solves and who is going to use it. Define the scope of the product briefly and showcase the value it will deliver to the target user.

Here is an example of a product purpose for a flight management system:

“The purpose of this online flight management application is to provide convenience to users who want to book airline tickets online as well as to vendors who want the ease of flight management. The reservation and flight management functions will be made available using a relational database. We will also have a database server that enables passengers to buy tickets from airlines all over the world. Since the app is intended to be used by young and middle-aged adults, the user interface will be both visually pleasing and very intuitive to use.

Product description and functional requirements

Here, you will describe how the software should work. Mention the features you need in every section of the software application. Moreover, it’s vital to explain how the software will enable users to interact with these features.

Continuing with the flight management software example, here is what a product description should look like:

The software will have two different user privileges; one can be accessed by customers and the other can be accessed by employees.

To keep things short, I will only present an example of the software feature as accessed by the customer.

What the customer should be able to do

  • Create an account
  • Search flights for their desired routes on their desired dates
  • Filter the choices based on budget, class, supplementary services etc
  • Make a reservation (one way, round trip, multi-city)
  • Pay for the reservation
  • Cancel reservation
  • View itinerary
  • View history

A sample use case for booking a flight

Let’s assume the user has created an account and is on the home screen right now. To make a reservation, he should be able to take the following steps:

1. Enter the city he wants to depart from in the “FROM” section.

2. Enter the city he wants to arrive at in the “TO” section.

3. Add the date of travel and the number of traveling passengers.

4. Hit the Search icon to receive available flight options.

5. Filter and sort the options based on price, time of departure, stops, class, etc.

6. Select and view the details of a flight.

7. Enter passenger details.

8. Add payment options.

9. Apply promo code.

10. Pay for the flight and confirm the reservation.

After the features of the product, you will also mention the operating environment (languages, platform, etc.) for the development team’s reference.

The most important aspect of how to outsource software development projects the right way is to understand how to write the functional requirements of your software.

Non-functional requirements

Non-functional requirements concern the aspects that are not essential for the software’s functioning but are still very important for the quality of the software. In simple words, the software can still work without these requirements but it is of no use to the client.

The major sections of non-functional requirements include:

  • The overall look and feel of the software
  • Performance of the software
  • Security requirements
  • Software quality attributes (usability, maintainability, accuracy, etc.)

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Step 3. Specify the success criteria when you outsource software development projects

Success Criteria Metrics

Now that you have laid down your requirements, you must specify the results you want. The success criteria of your requirements must be measurable so that you can verify how the product fares against the specifications.

This is where Key Performance Indicators (KPIs) come into the picture. Assessing offshore software development aspects in numbers will confirm how successful the entire association and development process has been.

Here are the common metrics you can use to measure the performance of your software development outsourcing partner:

Financial KPIs
Metrics like changes in operational costs, changes in infrastructure expenditure, ROI, etc help you gauge whether the team stuck to the budget or went overboard.

Service quality KPIs
Good performance on metrics like customer satisfaction, software security, clear documentation, etc indicate your software development outsourcing partner is great with their services.

Always track how often the meetings were canceled/rescheduled, how open the team was at taking feedback, and how many times the progress was reported to you. These metrics are key differentiators of a good software outsourcing company.

Based on your product goals and business objectives, define your own KPIs to track the performance of the software development team in all the relevant aspects. This is integral to ensure the success of outsourcing software development projects.

Step 4. Estimate a timeline and a budget for outsourcing software development projects

Estimate for outsourcing software development projects

There are two approaches to work around the timeline and budget of software development.

Budget/timeline backwards approach
If your budget is fixed and limited, or you are building a time-sensitive project, this approach is ideal for you. As the name suggests, you put a cap on the budget. Then, work your way backwards to determine what fits in that budget and how much you can accomplish in the given timeline.

Feature forward approach
This one is a more commonly used approach by most businesses. Based on the requirements you mentioned in the previous section, you can put a rough cost estimation for each set of requirements.

It’s ideal to break down the entire project into milestones and then allocate a time frame to each milestone. In this way, you can arrive at a realistic timeline and budget for your software development project.

You are all set! Hire the right development partner to outsource your software development projects

You have a clear set of requirements. You know the desired results. Budgets and timelines are all set. So finally, it’s time to look for a software development company that can shape your requirements into high-quality software.

Where to look for development partners
If you are looking at efficient software development at the most competitive rates, India is your ideal choice for hiring a development company. As per the Global Services Location Index, India ranks the highest in top offshore development destinations.

What to look for in a software development company
Experience working with businesses in the same industry as yours, a credible portfolio, a highly qualified team are the major criteria for hiring an offshore software development company. Additionally, ensure their services are scalable, their documentation practices are reliable and they have a 24x7 help desk.

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Third Rock Techkno is a trusted software development outsourcing company known for its quality deliverables

Combining the expertise from both the US and India, Third Rock Techkno is a unique offshore software development company. We have garnered a diverse experience in the past seven years by delivering high-quality software to global companies at the most competitive rates.

Whether you are a startup or an enterprise, we have just the right talent pool for you. Let’s talk about how we can transform your idea into a profitable business. Contact Us today.

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