Software Development Outsourcing Hub

Chapter 6: Managing a Software Development Outsourcing Team

Paavo Pauklin
February 8, 2024

Software development outsourcing opens new doors to global talent. Yet, it’s vital to manage these IT teams effectively. Ultimately, management can make or break your product success. 

Recently, we took an in-depth look into hiring the ideal software partner. Now that you’ve chosen the right provider for your needs, let’s maximize your IT teams for optimal results. 

In this article, we’ll go through first-rate outsourcing management strategies. We’ll detail best practices for communication, team culture, recruitment/retention and more. Kick off your project with our leading tips below!

Challenges in Software Development Outsourcing

IT outsourcing is a major business opportunity, but it also has its challenges. The first obstacle is finding top talent for your company. Just consider that the developer gap will reach 85 million by 2030. 

Once you capture the right developers, it's essential to integrate them ASAP. This involves creating well-established remote logistics and seamless cultural alignment. Over time, you’ll also want to keep your best pros through benefits such as a positive workplace. 

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Key Success Factors for Software Outsourcing

Fortunately, there are key steps you can take to set up your project for success. Clear team management will ensure that your developers align with the project vision. Doing so will also prepare them to seamlessly collaborate. 

For example, you’ll want to create a management plan that details these critical areas:

  • Robust onboarding
  • Clear goals and KPIs
  • Strong communication practices
  • Positive work culture
  • Secure agile methods

Although every business has their priorities, define these vital areas in advance. (And see more in our ultimate guide below!)

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Managing Remote Software Development Teams

Step #1: Organizing Communication in IT Outsourcing

Communication is the foundation of all IT projects. A whopping 57% of software outsourcing products fail due to poor communication. Here are some ways to avoid misunderstandings and excess project changes. 

Documenting Communication Channels

Transparency is the name of the game. Leverage clear tools and workflows, so developers know how to stay connected. (Top recommendations include Slack, Loom, Miro and so on.) Document processes such as milestones, organizational charts, product roadmaps and more. What’s more, define change management practices in your scope to avoid frustrations. 

Overcoming Language and Cultural Barriers

Acknowledge cultural differences and find ways to bring together your teams. Setting clear expectations for deadlines, communication, quality standards, etc. is helpful here. (You might even create a workplace handbook for clarity.) In addition, stay sensitive to diversity and foster collaboration based on shared goals.  

Setting Up Regular Goals and Check-Ins 

Schedule daily/weekly stand-ups and sprints to align your teams. Every developer should have short- and long-term milestones for their work. As part of this process, be sure stakeholders are included regularly in feedback. They should also be notified through progress reports. 

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Step #2: Using the Agile Methodology to Optimize the Project

Your management strategy should be tailored toward the agile methodology. After all, this work mode can boost project performance by 277%

Agile involves continuous cycles of development, feedback and iteration. Instead of working towards a fixed vision, agile emphasizes constant improvement. To get top outcomes, it’s important to create close-knit teams that aren’t afraid to pivot. Some ways to establish agile practices include:

  • Build an MVP to define viable features.
  • Research real user needs and business KPIs.
  • Schedule daily/weekly stand-up meetings.
  • Embrace regular feedback cycles with stakeholders.
  • Focus on close collaboration and clear communication. 

Step #3: Focusing on Elevating Team Culture 

IT outsourcing management is most successful when people-focused. Thoughtfully create a positive team culture from day 1. You can create stronger camaraderie and collaboration through:

  • Robust onboarding and integration.
  • Fostering shared experiences. (i.e. virtual coffee breaks, informal Slack channels, game breaks, yoga sessions, etc.)
  • Giving teams a sense of purpose. (i.e. mission, recognition/awards, time for personal projects, etc.) 
  • Entrusting your developers with autonomy.
  • Creating open forums to listen and learn. (i.e. collaborative meetings, peer-to-peer feedback, etc.)

At the same time, it’s worth focusing on outcomes on your teams. Define what success looks like for every developer, including key metrics. Have regular feedback cycles to reward efforts and improve performance. Overall, this will encourage growth mindsets and keep your culture developer-friendly. 

Building Key Recruitment and Retention Strategies

Nearly 90% of leaders said IT recruitment/retainment was a “moderate or major” barrier. As you manage your remote IT teams, keep in mind these strategies for fuller, more engaged teams.

Capturing Top Talent From Your Partner

The best developers are in high demand from companies worldwide. You can better appeal to top talent by reimagining what you can offer them. Some expert-backed recommendations include:

  • Boost value proposition for candidates. This may involve a positive work culture, a sense of purpose and flexible work. Don’t forget about a competitive salary and non-monetary benefits, too. 
  • Meeting individual needs. Growth opportunities are cited by 49% of professionals as the #1 factor in IT job satisfaction. Craft individualized career plans for your developers. Include educational opportunities, career advancement, regular recognition, feedback cycles, mentorship and more. This will help keep your IT teams motivated in the long term.
  • Gleaning data and insights about your teams. Conduct ongoing surveys, exit interviews and more to understand your employees’ needs. Analyze the data regularly and adjust your retention strategy as needed.
  • Building strong partnerships for talent. Finally, don’t overlook the importance of creating close ties with your partner. Creating solid rapport can help you find talent with the right skills and values. 

Keeping and Growing Your IT Team in Today’s Market

Turnover can be extremely costly in IT, resulting in an average spend of $30,000 per role. In addition, turnover disrupts your teams and delays your products. As a result, this can interrupt your long-term business plans. 

Today’s market is fierce, with IT hiring ranking as HR’s greatest challenge. You can enhance your company’s odds by incorporating these creative solutions:

  • Working with global talent experts. Use professional agencies located worldwide to discover new talent networks. These experts have a niche understanding of IT companies, universities, local events, etc. 
  • Staying open to non-traditional backgrounds. Focus on promise, not perfection. For non-traditional CVs, look for courses, certifications or hackathons. Personal testimonials or references are also helpful. 
  • Setting up robust upskilling and training. Don’t shy away from upskilling early-career developers. Invest in high-potential candidates and offer certifications, mentorship, leadership experience and more.

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Seamlessly Manage Your IT Teams With Netcorp

Get smooth sailing with your IT team by leveraging our top-notch management strategies. With them, pin down best practices for remote teaming, communication, culture and more. 

Keep in mind that the most successful tech teams start with top talent. As you oversee your next software project, get in touch with Netcorp. Management is seamless with our seasoned developers and agile processes. Learn more about how we create strong rapport to meet your most ambitious product goals.

How to Solve Common Problems in Cooperation
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Making it Work / Managing an Outsourcing Team
Unlock the secrets to successful software development outsourcing with our comprehensive guide on effective team management strategies.
Hiring a Software Development Outsourcing Partner
Learn how to choose a software development outsourcing partner, and how to make an informed decision.
How To Prepare Your Organization For Outsourcing
Essential strategies and insights to set your organization up for software outsourcing success
Software Outsourcing Costs
Learn how to make your software outsourcing investments work for you with expert costs and pricing strategies.
Does Outsourcing Work For Us?
Determine if outsourcing will meet your company's key IT objectives.
Introduction to the Basics of outsourcing software development
Skip to the next chapter to learn more about all the costs associated with software outsourcing.
Introduction to the Basics of outsourcing software development
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Paavo Pauklin
Executive Board Member

Paavo Pauklin is a renowned consultant and thought leader in software development outsourcing with a decade of experience. Authoring dozens of insightful blog posts and the guidebook "How to Succeed with Software Development Outsourcing," he is a frequent speaker at industry conferences. Paavo hosts two influential video podcasts: “Everybody needs developers” and “Tech explained to managers in 3 minutes.” Through his extensive training sessions with organizations such as the Finnish Association of Software Companies and Estonian IT Companies Association, he's helped numerous businesses strategize, train internal teams, and find dependable outsourcing partners. His expertise offers a reliable compass for anyone navigating the world of software outsourcing.

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