All companies need great software development. Software development is essential for staying competitive in today's digital world and it provides businesses with the tools and capabilities to increase efficiency, improve customer experience, optimize operations, and reduce costs.
It has become increasingly important to all companies, from startups to established enterprises, to create high-quality custom or off-the-shelf applications that are tailored to their specific needs. Having efficient software systems minimizes the time needed to perform regular tasks such as custom business processes, data analysis, or accounting processes, giving companies more time and resources to focus on their core operations and strategies. With an increase in the automation of processes, companies can even save on labor costs by replacing manual labor with automated software systems. By taking advantage of modern technology in a cost-effective way, companies can gain a significant competitive edge in today’s digital landscape.
Software development, and software in general, has hugely positive impacts on businesses around the world. But, that doesn’t mean that if not done correctly, it will still be cost-effective in the long run. Software development can be costly if done carelessly and without careful budgeting. According to SeedScientific, just the development stage of creating new software takes up an average of 63% of software department budgets.
So, how can businesses continue to invest in the software development initiatives they need to scale their businesses without breaking the bank? In this blog, we’ll first discuss the different factors that can make software development an expensive process and then, we’ll highlight four of the best ways tech leaders can reduce software development costs while keeping operations running smoothly, ensuring that quality is at the center of it all.
The entire software development process comes with different expenses, some of which aren’t always obvious from the start. Firstly, overall project expenses depend on the complexity of what is being built, the type of development (custom, low-code, platform-based), and the team involved. To get a clear picture of the key costs of software development projects, it’s best to break them down into phases simply.
For example, a typical first stage in software development is requirements engineering, UX design, and project planning. Statistics show that this usually equates to around 10% of an overall development project. Next, architecture and UI design can cost another 5-10% of a software development project cost. Coding (both back-end and front-end) can lead to expenses of around 65% of total project costs. Quality assurance, software deployment, and support and maintenance can also amount to around 10-20% each. Overall, software development can be an expensive endeavor, due to the resources and time needed to create a successful product. Depending on the scope of the project, costs may include the cost of licenses, software packages, hardware and infrastructure, third-party services, salary costs for employees and staff, and more. Most, if not all, of the tasks for each of these stages, involve people. Because of this, traditional and onshore hiring, instead of looking for more cost-effective solutions like nearshore software development, has placed an extra financial burden on companies looking to scale their software development operations. In fact, onshore software development can be from two to four times more expensive than nearshore.
Software development costs can also increase if project changes occur during development due to evolving customer needs or changing business goals. Feature additions or modifications may involve reworking existing code as well as introducing new components that weren't previously planned for. This often results in delays and can have a significant impact on budgeting. At Icalia Labs, we’ve found that not following sound processes and having to redo work is one of the most expensive parts of software development.
Because each software development project is unique, costs will differ. But, defining your budget and having clarity on your possible expenses for each stage of your project will be essential to your success. Here, we’ll share the four best ways to reduce your overall software development costs without ruining quality and efficiency in the process.
Use nearshore software development
Nearshore software development is an increasingly popular strategy for reducing the cost of software development while simultaneously leveraging the benefits of working with a dedicated team of skilled professionals. By taking advantage of nearshore resources, businesses can access qualified and experienced staff at lower costs than if they were to hire a local workforce. This way, companies are able to maintain their bottom line while still benefitting from modern technology solutions.
Another major advantage of nearshore talent augmentation is shorter time-to-market cycles thanks to reduced travel time and cultural alignment among team members. Companies that opt for this method are able to tap into already established teams in another country, which makes coordination and communication much more seamless than if the project was conducted locally. Countries outside the U.S. typically have lower labor costs and businesses are able to cut back on expenses associated with wages, equipment, and other overhead costs. Nearshore software development, through talent augmentation, also provides companies with access to specialized or niche skill sets that may not be available in their home country. This gives businesses the opportunity to take advantage of cutting-edge technologies without having to invest in costly training programs or long-term contracts with specialists located elsewhere in the world.
Unlike local, traditional hiring or onshore models, nearshore talent augmentation for software development can be an effective way for companies to reduce development costs while still enjoying all the benefits that come with working with a dedicated team of highly skilled professionals. With its ability to provide quality services at lower costs and faster turnaround times, it's easy to understand why so many organizations are now leveraging this approach for their software projects.
At Icalia Labs we’ve developed hundreds of projects and have extensive experience in multiple industries and verticals using nearshore staff augmentation and delivery teams. Our software developers, architects, and project managers are able to deliver the ultimate outcomes tech leaders and businesses need today.
Agile software development is a more cost-effective approach than traditional software development because it allows for faster delivery and better adaptation to changes. Agile enables teams to break down complex projects into smaller, manageable pieces that can be tested, iterated, and improved quickly. Agile methodologies also focus on customer feedback and collaboration with stakeholders, providing the opportunity to make adjustments and develop features as early as possible in the development cycle. This helps keep projects on track by addressing concerns right away instead of having them come up late in the process or after launch. Because Agile favors shorter cycles over big-bang releases, developers can work on smaller tasks at once while constantly integrating customer feedback into their codebase. This enables teams to have more efficient use of resources and fewer reworks of existing code sets, reducing the overall expenses associated with software development.
Thousands of businesses around the world have jumped on the Agile bandwagon and that’s why our team of Agile experts at Icalia has led highly successful custom software development projects for our clients across multiple industries. We’ve adopted several Agile methodologies in the development and testing processes. These include scrum, kanban, and continual prioritization of tasks such as basic planning cycles in each delivery sprint, keeping our client’s feedback at the core of what we do for the very best software delivery!
Hire custom Pods
Imagine being able to simply pick and choose between the very best of tech talent and having almost instantaneous access to your own customized team. Icalia Labs Pods are a team of experts available to quickly execute your software development and design needs in record time. The skill set of each Pod is customizable, and all Pods include success practices to ensure a smooth on-time project delivery.
No longer do you have to depend on traditional hiring processes and methods causing your business to waste time and money while your projects are left at a standstill. Custom Pods are carefully designed to provide the best tech talent, quickly. This way, you can launch your next software project or keep your current one in full steam by partnering with highly skilled professionals who come ready with the experience you need. No more long waiting times for the talent you need!
Founded in 2012 as an Agile Development Shop, Icalia Labs has evolved into a world-class nearshore software product firm enabling small and medium-sized businesses to translate their digital strategies into tangible value delivery. With a customer-centric design process and an engineering culture introduced to every product our team constructs, we guide our clients through an Agile framework to acquire new digital capabilities and fortify their innovation-to-market mindset.
Icalia Labs distinguishes itself from many other nearshore custom software development companies simply because of their way of doing things—the Icalier way. We’re committed to powerhousing positive change for humankind driven by the very best software. We believe people are a keystone to creating meaningful technology.
Contact us to learn more about how we can partner with you on your next custom software project!