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Outsourcing IT

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Exploring Outsourcing IT

Outsource is one of the options for many start-ups or businesses to have more time and resource to create higher value. Also,if it is a short-term product or project development, most people will choose to outsource, not only small companies but also large and medium-sized companies when they develop new technology fields. Nowadays, many well-known big companies decide to outsource.For example, before Facebook acquisition, a free communication application WhatsApp relied heavily on outsourcing software and core development; A multinational retail e-commerce platform Alibaba on their early stage choose to outsource their web development which the website is able to provide bilingual for not only native but also foreigners, which allow their expansion to multinational business.

In our team project, we will build an application called Food Gogo for Taobao website. Food Gogo is an e-commerce application, which customers can download on their mobile device and use it easily. Therefore, building a user-friendly application is our primary goal. Our project team has created a compared analysis to decide whether to outsource or not. The factors we have considered are time effectiveness, cost, quality, and productivity. As a result, shown in figure 1, outsourcing is an option for our project.

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Figure 1. compare analysis

Think of your own team’s project. What work can you outsource?

One of the main milestones in our project is to build a user-friendly application and target to provide as many as consuming goods on our request. Therefore, our project team decided to outsource app development to the third party. By outsourcing, the project team can coordinate with the app development team and create better features “UX design” and “UI design.” The main consideration for UX design is “the feeling of using the product.” There is no single positive solution to the design problem. UX designers explore a variety of different ways to solve a user problem. The primary responsibility of UX designers is to ensure that the flow of products from this step to the next step is logical. UI design. Unlike UX design which considers the overall look and feel of the product, the user interface designer specializes in “how the product presents.” They are responsible for designing each screen that interacts with the user and then confirming that the UI visually conveys the path that the UX designer is showing. For example, the UI designer has made a statistical information panel that might put the most relevant content on top, or determine whether the scrolls or controls used to adjust the chart are intuitive. UI designers are often responsible for establishing an official style guide that aligns the design language of the entire product.

What benefits will your project team see as a result of outsourcing this work?

Thereare four benefits our project team see as a result of outsourcing. First, cost-effective which allows the project team can control the budget based on the app requirements delivered. In another perspective, a business does not need to hire employees or IT professionals and to procure new technology architectures or resources to build an app. These reduce the operating costs for small business and reduce the cost for a short-term project. Second, time effective, our project team can focus on more important taskswhich will save our time and effort by outsourcing that allows professionals to increase development speed. Third, increase productivity because we outsource app development; therefore our project teamhas much more time to deal with products imports and coordination with products suppliers which these are essential and will directly affect business growth. Fourth, by outsourcing also share business risksthe risk of technology development can spread across several outsourcers without having to fully assume the risks of research and development and adoption of new technologies.

How does outsourcing impact your budget and schedule?

In our project businessrequirement, we estimated overall budget is $115,000 include market research $10,000,applicationdevelopment $85,000 and advertisement $20,000. We’ve estimated the price based on outsourcing price, supporting platform and time hourly rate. So, the outsourcing budget is already considered in our project. However, our project only focus on develops a mobile app that support platform include Android and IOS. In this project, we do not plan to develop a backend system or website; therefore these are excluded. By outsourcing, it will save our time because allowing professional to develop App while the project team focuses on products import.

The factors that affect the development price of outsourcing APP

Two factors that affect the development price of outsourcing app; First, Functional requirements affect development prices. If the function of APP custom development is very complicated, such as payment, instant messaging, logistics, the price will increase accordingly. Second, App support platform,common APP development mobile platform includes Google Android, Apple iOS, and outsourced mobile app software for one or both platforms. The corresponding outsourcing price is different for different versions. In addition to the mobile APP software development itself, many APPs set the management backend of the website version, and the backend development price of the website version also needs to be counted, which is also a factor that affects the development price.

Does outsourcing change how you will manage the project?

Yes, it affects our procurement process and requires stronger risk control in a project. When the project team decided to, it is essential to create a clear and transparent communication channel between the project team and outsource development team.Prior agreement as well as a well-defined software specificationwhich including what the customer thinks for, the outsourcer may have a different understanding of common sense because of the difference in culture, background and domain knowledge. Furthermore, third-party management in the process of App development, to avoid the risk of App developers taking power, two most important things are the transparent management of technical documents and code.  Our project team must standardize the information in the early stage. It is often heard that too many engineers left the company, took over everything and to rebuild the entire case, or outsourced, even the database password did not leave. The project team must ask for the management of technical documents and code. At least someone in the company needs to have a basic understanding of information system, and it will significantly reduce the risk.  Also, our project team will conduct phase meetings during development phases ensuring project team and App development team are aligned the project goal.

What work will you definitely NOT outsource?

Our project team will not outsource marketing strategy andcore business idea including what products to sell, product item categories, pricing, apply for US domestic sales licenses, product launches all these business processes.

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