5 Effective Solutions to Reduce Custom Software Development Costs

Andrew Zola January 21, 2021

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How much does it cost to develop robust custom software? As you’ve probably guessed, it’s all relative. Costs can vary significantly depending on the solution, expertise, where the product is built, and so on.

Often, software projects fail because of inadequate planning, poor communication, and bad management, and more. In fact, poor communication plays a much larger role in failed projects than technical ineptitude or unattainable requirements.

But before we get into the ways of reducing custom software development (costs without compromising on quality), let’s explore why people pay for custom software in the first place.

Enterprises engage in custom software development to enhance operational efficiencies and gain a competitive advantage. Custom software is built based on the company’s unique needs and represents a cluster of business logic innovative ideas. This approach negates the need for businesses to adapt their operations to accommodate turnkey systems that don’t check all the boxes.

As such, the demand for custom software and application development is fierce, driving up development costs. If you’re a small business or startup, such high costs coupled with unplanned expenses can derail business operations and lead to bankruptcy.

This makes it vital to carefully plan and find effective methods to keep costs down. So how should you go about it? Let’s take a look.

1. Research Your Outsourcing Options

One of the proven approaches to cutting software development costs is outsourcing the project. If you can look past the myths, you’ll find that it provides cost savings right from the beginning. This is because you don’t have to deal with in-house expenses like salaries, benefits, operational overheads, and more.

However, everything doesn’t come down to cost. “When you think of outsourcing, you have to look beyond lower rates because they don’t necessarily translate into lower development costs. To ensure software quality, you have to look at variables like language barriers, geolocation, quality of the education system in that country, available talent pool and maturity of developers, working culture, and overall cultural proximity including mentality, ways of solving problems, and so on,” Colette Wyatt, CEO at Evolve, advised.

Practicing due diligence is key to successful development projects, so take the time to do your homework before hiring a team of developers. Once you’ve shortlisted some potential candidates, ask the following questions:

• Have you worked on a similar project? If so, can I see some examples?
• Would you mind if I reached out to some of your previous clients?
• Can you discuss your approach to a software development project?
• How do you plan to communicate during each iteration?
• How do you hope to solve problems during the development cycle?
• Do I own the code once the project is complete?

The answers to the questions above will provide insights into what you can expect from each development provider.

2. Come up with Your Own Requirements

Ambiguity leads to extra costs. Your mission is to make all the requirements crystal clear. For example, if your development partner misunderstands your requirements, they’ll spend time working on a feature or function you don’t need (and that costs money).

Before engaging a software development partner, be wholly aware and sure about your business needs. Precise requirements will also help you receive more accurate quotes for the project.

If the development project is supported by proper documentation from discussion to deployment, it’ll minimize miscommunication. When everyone is on the same page, it’ll also negate the need to meet multiple times to go over your requirements.

3. Ensure Seamless Continuous Communication

As mentioned earlier, communication is key to ensuring project success. It’s essential to leverage communication and collaboration tools to keep the team talking and on track. This approach will also let the team know what each member is working on at any given time.

“Decades ago, corporations would ship their requirements to an outsourcing company located continents away and wait on project updates. Today, it doesn’t even feel like we’re outsourcing the work. As we’re all working mostly remotely these days, it feels like we’re all working together on projects as we would in an on-premise environment,” Wyatt added.

4. Start Testing Early and Repeatedly

Start testing early during the first few iterations. This approach helps minimize technical debt and eliminates errors and bugs in the system. Engaging a QA team early also helps ensure application quality and time to market.

When you accumulate bugs and leave them for later, it can lead to significant delays (and, of course) higher costs. When you start resolving potential issues and conflicts early, you might also find new opportunities to make the functions better or identify completely new uses for the application.

5. Focus on What’s Absolutely Necessary

During the project’s ideation stage, it’s easy to get carried away. Excited stakeholders will unleash their imagination and often come up with some great ideas. However, most can’t afford to accomplish everything.

By concentrating on a few (vital) features, you’ll have a better handle on your budget. It’s important to note that unabridged solutions take a few versions to roll out, and that can burn through your budget.

Start small. If it proves to be valuable (and profitable), make a case to increase your budget and add more features. This approach helps better manage development costs and provides an opportunity to engage in market research with real users.

There are more ways to reduce development costs (like cloud computing). But I’ve focused on the above as these five factors significantly impact your development costs and your bottom line.

So, before you start your next project, make sure to prepare properly, hire the right people, and keep your communication channels open around the clock.

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