How To Avoid Hidden Software Development Costs

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Cost-effective software development strategies

Custom software development requires a lot of money, time, and effort. Even if a company's budget is carefully planned, unforeseen situations can arise on a project. For example, application security flaws, functional bugs, development delays, changing requirements, and so on. You have to pay for them to keep the project going. Is it possible to avoid hidden software development costs? Yes, if you choose a good technology partner and prepare for the project thoroughly. We will tell you how to do it. 

Conduct market research

Let's start with the fact that the biggest expense is a program that no one will use. The investment will not pay off. Why? First, even decent software will fail if there is no market demand for it. Secondly, if a program is of poor quality, it will not be able to compete with more successful applications.

In 42% of cases, projects fail because there is no market demand for them. Therefore, before applying for custom software development services, you should test your idea on the market:

1. define the target audience of the product and their 'pains';
2. study your competitors, their strengths and weaknesses;
3. predict market needs;
4. determine the functionality of your software;
5. document your business goals.

A Business Analyst carries out market analysis. This specialist usually leads an IT outsourcing team and communicates with the representatives of a customer. The Business Analyst ensures that after release, the product owner and investors will receive an up-to-date working application that will soon pay off and will be interesting to buyers. Learn how a Business Analyst reduces software development costs.

Prepare product requirements

A project begins with requirements. There is very little research on how their quality affects the success of a product. In 2002, a group of British scientists found that 48% of problems in custom software development are due to inaccurate specifications. Since then, there have appeared no substantial surveys. But project teams have learned from their experience that requirements help to:

1. find errors and inconsistencies before the start of development;
2. estimate the amount of work to be done and the budget of the project;
3. check the quality of the product;
4. set project metrics.

These indicators help the team to release the application on time, within budget, and with a full range of quality functionality.

Vision&Scope, SRS, and other documentation are important for the project. They make it easier for the customer to control the development and communicate with the IT outsourcing team. Requirements help avoid situations like the one the New York City Automated Payroll System (NYCAP) faced. The project started with a budget of $63 million. Due to dishonest control and inefficient management, project costs increased by almost 5.5 times - up to $360 million.

Involve a team of testers

The IBM Institute of Systems Science found that eliminating defects after a product is released is 4 to 5 times more expensive than during custom software development. But fixing an error at the maintenance stage can take 100 times more money.

Capers Jones, an American engineer, calculated that it would take $16,000 or more to fix a bug that was found after release. If you do it at the development stage, then it will cost only $25.

In 2019, poor software cost the US economy $2.1 trillion. This means that a valuable QA budget is wasted on fixing bugs, which can be done cheaper early in the SDLC.

Involve a team of experienced testers from the early stages of development to save your money. This is a guarantee that you will not lose tens of thousands of dollars to fix problems and will not lose up to 88% of customers. QA specialists will do a great job to keep the product quality and save your resources. They will:

1. check the requirements for errors;
2. determine the testing strategy;
3. create test scenarios;
4. prepare automated tests;
5. conduct the necessary types of testing (functional and non-functional);
6. precipitate the release of the software product.

In any case, the work of a QA specialist will pay off, because the price of mistakes can be much higher.

Create an application prototype

A prototype helps to show the software development team what kind of application they need to create as simply and quickly as possible. This is the model that the project team is guided by, visualization of product requirements.

Even when a programmer reads the documentation, they may implement individual elements differently than the customer intended. The developer will have to redo certain functions. The prototype solves this problem because a clear picture is worth a thousand words.

Prototypes are quickly created on paper or in special programs. They ensure that customers and developers see products in the same way. And the team will create an application faster because specialists don't need to spend time finalizing the design or functionality of the program.

Develop an MVP

A minimum viable product (MVP) also saves the business money. This is a simplified version of an application that allows testing the program on the market, getting the first reviews, and evaluating the prospects and payback. After it has been tested, you may either continue development or close the project so as not to waste money.

The MVP includes only the most important functionality that clients can work with. Users begin to interact with this product, leave reviews and share their opinions on what needs to be improved in the application. The software development team is gradually adding new functionality, and improving the product. The target audience is growing, and so is the income.

As a result, the business quickly receives a working version of the program, the first users, and money. Without an MVP, developers will need more time to implement all the functionality of a software product. At the same time, there is no guarantee that the audience will like the application and that it will not have to be finalized after release.

Create a product roadmap

A product roadmap is a relevant source of information. It describes the vision of a product, the progress of the team, and strategic plans for software development. It is a document that communicates results and expectations of how the application will evolve and why.

For the project team, release dates are entered into the map and general tasks are mentioned by date. Customers see the progress of work on the product roadmap.

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The roadmap explains why certain features were conceived. For example, 200 important users might have asked for it, or because it solves the problem of customer churn.

Take care of security

2020 was the fourth record year in the number of attacks. The US-CERT database recorded 17,447 vulnerabilities. So, according to the top-notch development team https://vitechteam.com/, developers need to be very attentive. This means that the software development team needs to be very attentive to the security of their code. Hackers are inventing new, more sophisticated ways to steal data.

Data breach costs increased from $3.86 million to $4.24 million. Managers consider investing in program reliability a top priority. They willingly seek security services: advice, infrastructure support, legal compliance checks, and so on.

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Therefore, you should take care of reliability at the stage of product creation. Ensure that developers implement various information security tools:

1. authentication and authorization;
2. encryption;
3. logging, and so on.

Experienced outsourcing software development companies practice DevSecOps when working on software security is included in a continuous cycle of integration and delivery. Programmers have enough tasks to complete and are limited by deadlines. Therefore, security may not always be their number one concern. The DevSecOps culture motivates the team to build solid software from the very beginning. 

Release a product iteratively

Iterative development is based on iterations - separate phases that last 2-4 weeks. A first version of the software is created, then new features are gradually added.

An iteration can target a specific set of requirements. Therefore, to start development, it is not necessary to wait until all the documentation is ready.

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This model can be easily implemented by outsourcing software development companies using Agile, Scrum, and DevOps methodologies. Iterations allow creating basic functionality in the early stages of development, changing the application at the request of users or the customer, and testing and improving the program during custom software development.

Perform code refactoring

On large projects that last 1-5 years, you should perform code refactoring, i.e. optimize outdated code. Every 2-3 years new versions of languages ​​are released, and frameworks and libraries are regularly updated. The code that used to be clean and high-quality is becoming obsolete. A function that took about a page of code to write can be replaced with a single line.

A group of British engineers calculated that refactoring could cut costs by up to 60%: 

1. removing unnecessary classes, functions, and variables speeds up a program;
2. it will be easier for developers to fix bugs in the future;
3. code refactoring reduces the risk of system failure;
4. it is easier for developers to implement new features;
5. this process fixes pieces of code vulnerable to attacks.

As a result, even if an application has been created for more than two years, it will turn out to be relevant and 'clean'. It can be easily developed and scaled.

Take into account software deployment costs

Significant costs come up during application deployment. They depend on the size and complexity of a program, the number of users, and the amount of data. You should consider that, in addition to custom software development services, you will have to pay for:

1. functional services (push notifications, chat functions, SMS, and email alerts);
2. maintenance (updating the application and fixing errors);
3. infrastructure (for example, for the services of a cloud provider);
4. the work of employees who are involved in the deployment and maintenance of the application or other services.

In the IT industry, the cost of maintaining an application after release is approximately 15-20% of the initial development cost. That is, if the customer allocated a budget of $100,000, then deployment and maintenance will cost $20,000 per year.

Find a reliable IT partner

Perhaps this point should have been mentioned at the beginning. If a businessman hires a team of experienced proven developers, they will consider all of the above issues without giving the customer unnecessary information and details.

Leading teams typically practice iterative development, prototyping, and MVP. They include testing and security in all phases of the SDLC. They create a program with a clear vision, quality requirements, and a product roadmap, perform code refactoring, and help deploy software at no extra cost.

All these and other points are negotiated with the customer and taken into account when calculating the cost of the project.

Andersen, an outsourcing software development company, turns to best practices in software development. We discuss all important points at the stage of pre-sale preparation. Our clients know in detail how much money they will spend on a project. We also tell our clients about possible software development costs.

Isabella Humphrey

Update 01 April 2022