Mistakes to Avoid When Reducing Software Development Costs
“Every action should be an opportunity to improve” - Mark Graban
On August 1st, 2012, the Knight Capital Group introduced a new software update to their production servers. However, the software was misconfigured and sent Knight on a buying spree, buying up to 150 different stocks ending with the overall damage of $440 million in the pre-tax loss. This happens because the developers were repurposing an outdated piece of software to cut down the costs. However, this decision later showed to be a problem as the entire Knight software system malfunctioned, which caused their pitfall.??
It remains unequivocal that the quality of software being developed can greatly impact its performance. Although reducing the costs of developments is appealing, it is essential that when doing so, it is not done at the expense of the quality of developments. Small businesses accommodate for this by correctly evaluating what is available to compensate the right price for the development partner. This process is called cutting down SDCs or software development costs.?
SDCs Challenges
Figure 1: Software Development Costs Factors
SDCs have been an ongoing problem for businesses. There are many expenses that companies need to pay attention to, such as human resources, quality, communication systems, insights, and hiring experienced managers.?
People tend to focus on price and how expensive creating software seems when creating software. However, they often forget about their product's value and quality. There are reasons quality costs more, it's because it lasts longer. In contrast, cutting costs during the early stages of development is pricey in the long run. This is because it can create bugs and take the cost of time and resources to fix them. Moreover, clients will have new ideas or systems they want to integrate into the software.?
When leadership emphasizes cost savings, developers will undoubtedly feel rushed. And when developers feel rushed:
With these cautions in mind, project developers and business owners need to have a clear framework when laying down the path for software development. Of course, good developers know what to do such as train bad developers, change the configurations and see what happens. But, retrospectively, bad developers can gain experience by trading mistakes for the experience.?
Solutions for the Continuing Cost Problem?
To advocate how small business owners can save money on SDCs, a clear vision of the project is critical. Scoping is a method used for calculating the costs of software development accurately. It starts by using a problem statement identified during the brainstorming process (Brief stage) to collectively develop a solution to solve the problem. To find the solution, developers need to move from the inspiration, understanding, ideation, prototyping to the implementation stage (refer to Figure 2). Eventually, define the project goals, requirements, task roadmap, key deliverables, and deadlines.?
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Figure 2: The Scope Process
Moreover, recently companies increase their focus to capitalize on SDCs as they recognize the value of internally-developed software as fixed assets and begin to compensate the developers when a feasible piece of software is gained. As reported by ACCA, in 2019, 38% of 21,000 international organizations are capitalizing on SDCs. This demonstrates that software development costs have become more important in recent years and the desire for experienced developers and skilled individuals outweighed the inexperienced freelancers who lack the commitments to maintain the software's quality. Once these factors have been determined, developers can provide cost estimation for each stage of the project and start building the software.??
Final Thoughts
Overall, developing quality software is not an easy task for business owners as employing experienced project managers and developers can be expensive. Therefore, some businesses employ inexperienced individuals or cut corners in the software development cycle to save some money. But, contradicting, this proves to be costly in the long run as software development is dynamic with many uncertainties requiring the developers' time and commitment to resolve them.
To figure out the right cost of your software at an affordable price, schedule a free consultation session with Rofi Labs now. With decades worth of experience, our engineers are readily equipped with the essential tools and knowledge that can help to reduce the financial burdens and provide quality products that match your business's needs.??
"Success is not necessarily about connections, or cutting corners, or chamba - the three Cs of bad business. Call it trite, but believe me: success can be achieved through hard work, frugality, integrity, responsiveness to change, and most of all, boldness to dream."
— John Gokongwei
Author:
Benley Nguyen, Copywriter @Rofi Labs