The development of software offshore is an excellent method for achieving cost savings and tapping into a global pool of talent. Offshore development is also known as BPO. To ensure that your offshore software development strategy is providing the anticipated benefits, it is essential to measure the return on investment (ROI), just as you would with any other business investment. In this article, we will discuss five different methods that can be used to measure the return on investment (ROI) of offshore software development.
1. Specify Your Goals and Measures
Establishing clear metrics is the first step in measuring the return on investment (ROI) of offshore software development. It is important for metrics to be specific, measurable, and connected to the goals of the business. For instance, if your objective is to cut costs associated with development, you might measure return on investment by contrasting the prices at which software is developed in-house with those at which it is developed offshore. If reducing the amount of time it takes to bring a product to market is one of your primary objectives, one way to calculate return on investment is to examine how much longer it takes to do so when working with an in-house versus an offshore team.
2. Monitor both your costs and your savings.
Tracking both costs and savings is the second method for measuring the return on investment (ROI) of offshore software development. This includes not only the cost of developing software offshore but also any other costs that may be associated with it, such as travel expenses, training, and infrastructure costs. You will be able to accurately measure ROI and determine the real cost of developing software offshore if you keep track of both the costs and the savings.
3. Keep an Eye on the Productivity
In offshore software development, productivity is another essential metric for calculating return on investment (ROI). This includes keeping a record of the number of tasks that have been finished, as well as the quality of the work and the amount of time it takes to finish each task. Monitoring productivity enables you to identify areas for improvement and ensures that your offshore team is delivering high-quality work on time. You can achieve both of these goals by ensuring that your offshore team is productive.
4. Determine the Level of Satisfaction of the Customers
The level of satisfaction experienced by the client is yet another essential metric for calculating return on investment in offshore software development. You can determine whether your offshore team is meeting the needs of your customers and delivering products that meet or exceed their expectations by measuring customer satisfaction. This will allow you to determine whether or not your customers are satisfied with the products they receive from your offshore team. This can assist you in determining areas that require improvement and ensuring that your offshore team is providing value to your customers.
5. Evaluate Return on Investment
In conclusion, it is necessary to conduct a return on investment (ROI) analysis of the offshore software development strategy you intend to implement. This involves contrasting the costs of developing software offshore with the benefits obtained, such as reduced expenses, increased productivity, and a reduced amount of time needed to bring a product to market. You can determine whether your offshore software development strategy is delivering the expected benefits and identify areas in which it could be improved by conducting a return on investment (ROI) analysis.
In conclusion, calculating ROI is an essential component of any strategy involving offshore software development. Businesses can ensure that their offshore software development strategy is delivering the expected benefits by establishing clear metrics, tracking costs and savings, monitoring productivity, measuring customer satisfaction, and evaluating return on investment. This allows businesses to identify areas in which improvements can be made.