5 Changes Your Startup Must Make To Succeed With Offshore Product Development

Offshore product development is now quite common in the technology world. Some of the most successful startups such as Basecamp, GitHub, and MySQL are good examples of startups that successfully outsourced their product development and yet were massively successful.

It’s fair to say that outsourcing is only going to increase because of the cost and business benefits it brings to organizations and especially to startups. Highlighting this trend, the IT Outsourcing Report stated that nearly 40% of companies that outsourced application development planned to increase the volume of work they outsourced. The report also stated that 53% of companies with a mobile app outsourced their development initiatives. When it comes to startups, outsourcing had its own set of advantages other than just cost. Since startups are usually resource and time constrained, outsourcing product development makes abundant sense. Outsourcing gives startups the bandwidth to focus on the business aspect without having to worry about the many complexities of product development.

That said, outsourcing product development is anything but a simple process. Both the startup and the offshore product development team need to iron out certain processes to ensure that product development happens effortlessly, and the end result is superlative. Here are some suggestions on how to make this work.

  1. Treat the Offshoring Team As Your Extended Team:
    Your offshore product development team is an extension of your internal team. They thus should be treated with the same amount of trust that you would show your local team. Startups must trust that the outsourcing vendor will work with a commitment to ensure that they develop a product that is successful.
    In our experience when a startup treats their outsourcing vendor and the team as their partner they work harder for you and empathize more. The fact is, you hire an outsourcing team for the experience and expertise they bring to the table. So, treat them as a part of your internal team to get the most out of that portfolio. Trust their insights and get them more involved by embedding them into your development process.
  2. Leverage Them As Your Technology Partners:
    Your offshore team gives you open access to strong technology experts. Sometimes this might lead to a clash of views. Such clashes often happen when the technology expert feels that a particular technology is more suitable for a project and the startup feels otherwise. In such a situation, it is advisable to have an open discussion like you would have with your internal team member.
    Let us speak on behalf of the offshore product development vendor for a minute. Given that these experts have their finger on the pulse of the tech ecosystem beyond just your product, their opinion will usually not be driven by technology bias. It will generally stem more from a desire to leverage the technology that will help in developing a better, feature-rich and more robust product.
  3. Integrate – Make Them a Part of the Big Picture:
    Would your internal team be able to function if you don’t give them an idea of the big picture…of where your startup is heading? It’s no longer the case that offshore product development teams work best only when managing certain non-core activities in isolation. If you want your startup to succeed, you must ensure that all invested stakeholders have a clear idea of your company vision and mission -and this includes the offshore team.
    Help the offshore team understand not only the problems the product is trying to solve but also where the company wants to go in the long run. When you share your vision with the offshore team you give them the context in which they can innovate on your behalf. They can then help you come up with ideas to make the product better, how to extend the product, how to plan for an accelerated product development roadmap and come up with a product evolution plan.
  4. Establish Clear Criteria For Success:
    You can only manage what you can measure. The same is true for startups working with offshore product development teams as well. Adopting an agile approach even in communication is key. Clear expectation setting helps in establishing clear criteria for success.
    To establish measurable and clearly accountable goals, have reasonable delivery timelines, have regular check-ins at a mutually convenient time, have a defined process of engagement that ensures that all deliverables are transferred in the appropriate format. It is most important to agree upfront on the parameters that define success to establish the performance of the offshore team.
  5. Great Communication is Critical For Success:
    Great communication leads to successful partnerships. When it comes to an offshore product development team, communication can sometimes prove to be the Achilles heel. Startups, thus need to ensure that there is an environment that fosters effective communication between the offshore and local teams. This means leveraging all available tools like emails, messenger, and chat for communication and clarifications. This will involve the use of appropriate productivity tools for proper project management.

    This is essential to eliminate misunderstandings based on assumptions. Ensure that your outsourcing partner offers a model for business engagement that helps you get clarifications in case the outsourced team is in a different time zone. Regular check-ins also play an important role in establishing clear communication channels. This approach is more structured and ensures that everyone’s time is used optimally and that no information falls through communication gaps.

A change in mindset is essential to succeed while outsourcing product development to offshore teams for a startup. Once you see this team as an extension of your own company then ironing out issues that emerge during any product development lifecycle become easy. Remember that at the end of the day, “Individually we are a drop but together we are an ocean”. It’s time to dive in!

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