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Should You Insource Or Outsource Your Development Team?

Mike Scott (Co-Founder and CEO), Ed O’Reilly (Co-Founder and COO), and Dave O’Reilly (CTO) of Nona got together to discuss the big question on the How to Be Moderately Successful podcast: should you insource or outsource your development team?

It’s a massive decision, so we’re just going to dive right into it.

Insourcing vs Outsourcing

Why are you considering these options in the first place?

Firstly, let’s take a look at what you need – unfortunately, there is no clear cookie-cutter answer to the great insource/outsource debate.

What kind of resources do you already have? What are you lacking? Do you need a development team for a short-term project, or are you going to shape your business around a technical capability that will serve you long-term? Have you considered your timeframe?

Answering these questions will help you organise your needs, and then shape your decision from there.

Do you have the capacity to build an efficient team?

Alright, let’s say you’re inclined to go the inhouse route. Do you actually have the time and the capacity to build this department? “It’s not simple to just put together a team of developers and make them be effective,” warns Ed. “It’s not a matter of simply having two or three developers.”

Then there’s the management of this team to consider. Is it large enough that it doesn’t have to depend solely on one person? Is there sufficient backup if the team leader walks away?

If you answered “no” to the above questions, you should seriously consider outsourcing your tech team.

Outsourcing mistakes to avoid

So how do you get the most out of your development partners? One mistake Dave has seen time and time again is when businesses choose an outsource partner, and then push that partner to commit to an unreasonable deadline. “Everyone will kind of know it’s impossible,” says Dave, “but the outsource partner will commit to that.” Which according to him is also a sign that your chosen partner isn’t necessarily ideal. “The kind of partner you would want would refuse to commit to that deadline.”

Now, let’s take a step back. There will always be impossible deadlines, but the point is that your partner shouldn’t just say “yes” without letting you know that realistically, your project will not be 100% complete by the given deadline. You need a partner that you can trust, who will be completely open and honest and say look, what you’re asking for is impossible, but let’s work this out. Let’s get enough done, and done right

“You need to get exceptionally ruthless about that and say, alright, so what exactly do we need? What can we push back on? And normally the answer is you can cut more than you think, although you might not want to. And it might not be pretty, but that’s why I say something is always going to move, ” says Dave.

You also have to be merciless about your priorities when it comes to these impossible deadlines. “Say they were these 10 features originally; you’ve triaged it to five,” explains Ed. “You believe you need to have these five. The deadline is still impossible and there’s no more budget. You’d still rather have three entirely complete features that are demonstrable, that are good, than five semi-completed features that are not demonstrable.”

The way that we work for ultimate success for a software project is to work on the features that are the most important, and complete them 100%. That way you’ll have your demo, or testing site – whatever it is that you need. “That way the most work is the most finished at any given moment,” concludes Ed.

Insourcing mistakes to avoid

If you’re a non-technical founder (like Mike), you’re going to need a trustworthy CTO (like Dave). This is the person that is going to put your team together: they know what kind of technical skills are required, who to hire, and how to run this particular part of the ship.

Without this person, you run the risk of being taken advantage of or making the wrong decisions. You’ll only find out that the developers you hired were taking you for a ride and that the software they built is substandard when it’s too late. It sounds dramatic, however, it’s an unfortunate risk you cannot afford to ignore. Investing in a strong,honest and experienced CTO could protect you from these risks. 

If you’re still unsure about which route you should take, get in touch and we’ll help you figure out your options. You can find all of our contact information here.

Nona designs and builds intuitive software for FinTech businesses. If you’d like to accelerate your FinTech project, book a consultation with us!

Nona Digital

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