MVP Development: Should You Go for In-house Development or Outsourced Development?
Opting for an MVP, or Minimum Viable Product, before going all-out in the software development or app development process has become an acknowledged strategy. Because of the significant margins for improvement brought about by an MVP, tech startups and companies can significantly reduce risks. This is a vital benefit that enables companies to move through the market strategically.
MVP development is an intricate process that requires different kinds of resources. The concern would be whether the company’s existing team is capable of building and launching an MVP on their own. When there is a lack of skill set in order to execute the building and launching of an MVP, what should companies do?
Generally, there are two options that tech startups can go with in having their MVP developed. These are in-house development and outsourced development.
What is in-house development?
The first option, in-house development, involves forming an in-house team that would be in-charge of doing the job, which in this case is MVP development. This team would be under the full care and control of the tech startup. Thus, hiring more talents would be a viable move when necessary. This is essential when the current team does not have the required skill set needed to execute the task.
Pros of in-house development
Since the team is the company’s very own, there are certain advantages that come with it. These include the following.
1. No external access granted
Because in-house development takes place within the company, access to servers or portals is limited to the company. Not just anyone can access such key pieces.
2. More facilitated communication and collaboration
Given that the in-house team is part of the company, communication and collaboration are thus internal. This means that such processes may be smoother. Reaching and connecting with team leaders and members may be more convenient and smooth.
3. A higher degree of control
Direct management and control over the project is one of the perks of going for in-house development. Because the in-house team is under your leadership, you may have direct involvement in the management of the project.
4. Carefully chosen team members
If necessary, the in-house team may go beyond the entrusted project.They may become permanent partners in the company that would work with even more incoming projects. Thus, when hiring members to fill the team, it is important to make sure that they are the right fit for the company itself and not just for the project alone.
Several tech startups as well as large, small, and medium enterprises have chosen to go with in-house development. Amazon, for one, has an in-house team that they directly manage. This is one option that companies can go for to have their MVP built.
Cons of in-house development
However, there are also cons to in-house development. These include the following.
1. Costliness
When it comes to in-house development, all types of costs have to be covered. There has to be a budget for the tools, technology, equipment, maintenance, training, upskilling, and more. Moreover, unlike outsourced development, these expenses aren’t one-time. Not to mention, adding employees into your company would entail higher operational expenses in the long run as well.
2. Responsibility for upskilling
Because the in-house team is the company’s responsibility, it is also the responsibility of the company to make sure that their technologies, tools, programming frameworks, and other key pieces are up to date. This is especially important if these details may affect the project’s overall course and output. As opposed to outsourced development where the outsourcing firm takes care of such upskilling, companies with in-house teams have to fend for themselves.
3. Turnover
A team member’s dismissal is one of the greatest challenges when it comes to in-house development. Even after channeling resources to hone the employee, there is still the risk of turnover. In such a case, having to add a new team member would affect the project’s costs, teamwork, and other aspects of the project.
4. Limitations
When it comes to in-house development, the pool of candidates are typically narrowed down according to talents from within the area or who are willing to move to the area. Given these restraints, it may be more challenging to find the right fit for the project.
Aside from that, as the project progresses, needs may unfold. Additional competencies may be required later on in order for things to be accomplished. Issues that arise may take longer and costlier to manage with existing resources. Thus, higher expenses may be incurred. This would thus affect the project’s overall cost, progress and speed.
Because of these cons, several companies have opted for outsourced development instead. Companies like Google and Basecamp have opted for outsourced development over in-house.
What is outsourced development?
As opposed to in-house development, outsourced development involves partnering with an outsourced development firm to do the work. Instead of forming your own in-house team, outsourced development enables companies to simply partner with a company that specializes in software, web, and app development.
Pros of outsourced development
Outsourced development comes with several advantages that make companies favor such options. These advantages include the following.
1. Granted access to field experts
Outsourced development firms are specialized firms. By outsourcing MVP development, companies can partner with talents who are capable of working quickly and efficiently without compromising quality.
2. Granted access to technical consultation
Consistent innovation is necessary for the MVP to be effective in meeting goals. To innovate consistently, technical expertise and consultation are necessary. Because of their specialization, outsourcing companies have such expertise. Thus, this makes them able to build the fit MVP and support the entire process until its completion.
3. Cost reduction
Outsourced development is less costly compared to in-house development. For one, in some areas, it may be quite costly to hire talents that are fit for the task. Through outsourcing, however, offshore services become an option. These tend to be cheaper compared to local options. There are several companies from other countries, such as Vietnam, that offer good and affordable offshore services.
Moreover, since MVP development is quite flexible, the requirements may later on change or get updated. Because MVP development tends to be uncertain and temporary especially at the start, outsourcing would be a cost-effective option.
4. Expenses allocated on service, not tools and equipment
As mentioned earlier, when it comes to in-house development, the technology, tools, equipment, and other things need to be sorted out and taken care of by the company. However, this is not the case for outsourced development. It would be up to the outsourced partner to make sure that their technologies, frameworks, tools, equipment, and other key pieces are up to date. Thus, through outsourced development, companies would only need to spend on the development services.
5. A more efficient and structured MVP development process
Because outsourced development firms specialize in such services, they are able to properly plan, monitor, and manage the entire project. This is also an advantage of working with an outsourced development company compared to outsourcing a freelancer.
6. A more speedy MVP development process
Outsourced development companies have teams that are ready to be deployed. Thus, because of such readiness, the MVP development process could be significantly sped up.
These advantages of outsourced development makes it a favorable option by several companies. Instead of investing time and resources to build, hire, train, and manage an in-house team, several companies would rather partner with a specialized outsourced development firm instead. These outsourced development firms are capable of supporting the entire MVP development process.
To build your MVP, should you go for in-house development or outsourced development?
Tech startups have the option to build their own MVP or to partner with a firm that can do it for them. This decision may depend on the type of MVP to be developed, the skills needed to build such MVP, the availability of the needed tools and equipment, the costs for the MVP development, and the ability to support the entire MVP development process. Ultimately, after weighing the pros, cons, and circumstances, the choice still belongs to the company.
To know more about MVP development, check out the Ultimate MVP Guidelines.
