Onshore America
A sale sign

I took a day off a few weeks ago. When I came back to the real world, I turned on my laptop and found hundreds of emails, most of which were spam. 

We have all been there at some point – mindlessly hitting the delete button and wondering how in the world somebody thought I needed or wanted whatever it was they were trying to peddle.

But one email caught my eye, and not in a good way. I only read the subject line and became as angry as I typically get during horrific events like getting my cell phone bill.

The subject line read, Hire Software Developers for $9 per hour. I will not admit what I yelled aloud after reading the headline. But with apologies to bulls everywhere, let me at least explain my reaction.

Why would you need software written?

First, understand why somebody might be looking to hire a software developer. Typically, our clients are business people with a problem. They either use old software in their business that needs to be rewritten, updated, or expanded, or they recognize a need to replace expensive “off the shelf” solutions, or perhaps they want to create software for a new idea. 

They have probably put the problem off as long as possible.  

The solutions are often very involved and can be complicated. They need to make a big decision that will change the company (and everyone loves change, right?). Almost anything addressing such dramatic change can often be very detailed and sophisticated. In short, our clients are typically facing an issue that will almost certainly have a major impact on their business. That level of impact usually requires involved solutions that take time to develop, and that often means significant money is at stake as well.  

The pressure of such huge decisions, accompanied by the level of dollars involved in some solutions, force some people to try and find shortcuts or savings to offset some of the anxiety they are facing. Worse yet, most business people are not familiar with software technology. They do not always know what questions to ask, let alone what answers they should expect. Simply put, it is not what they do every day.  

They do, however, deal with money. So, there is a tendency to focus on cost, without really understanding how to calculate the actual value of a proposed solution. Typically, the smart decision weighs factors far beyond just dollars. Project cost is important, but relying on cost alone is often a foolish basis for a decision.  

Is this a bargain or a gamble?

Look at the supposed bargain offered in the email. To some, it looks like an incredible value. The buyer sees a chance to hire a software developer to solve this very complex, important business decision for only $9 an hour. It might seem like a relief, but it really should be a red flashing, eardrum piercing alarm.

Think about it. Since $9 per hour is the cost to the buyer, it includes the company overhead, profit, and the salary of the developer. That means the software developer you are trusting with this big decision is making considerably less.  

Software development outsourcing decisions need to be based on the right information.

So, what is happening? 

Almost certainly, you are hiring a software developer working somewhere overseas. They undoubtedly are sitting in a radically different time zone, thousands of miles away, working in a vastly different culture, likely speaking a different language and operating under business ethics rules that are probably different than those to which you are familiar. You have no idea how many hours it will take, or who is keeping track of the time. 

How long is the rate good for; what is the new billing rate going to be? Who owns the code; whose laws will determine your rights? What court system will you have to access to enforce any rights you happen to get under the contract (do not count on too many)?

Is it smart business to put the biggest problem faced by your company, possibly the future of the company, in the hands of a person making less than a part-time fast-food worker?  

And they are bragging about the rate they are giving you.  

Major decisions come at a cost. Sometimes costs get out of control, and factors like big-city rents, high overhead, or the profit margin accompanying those conditions make the project cost-prohibitive.  

What really matters.

But the answer is not at the other end of the pendulum. Learn to ask the right questions when outsourcing software development:

  1. Where is the code being written?  
  2. Who will own the software code when the project is complete?  
  3. How much experience does the team have with projects like these?  
  4. How often will I be speaking to the project manager?  
  5. How accurate have your estimates traditionally been?
  6. What is the bill rate for the project; is it guaranteed through the life of this project?

Getting answers to questions like these will help you truly make an informed decision about how to get your software development project completed on time and within budget.  

Grabbing at a rock bottom rate offered by a faceless stranger in an email probably is not your best solution.

Wayne Hippo is an owner and Managing Partner of PS Solutions, a software development and consulting firm with offices in Altoona, PA, Pittsburgh, PA, and Wilmington, NC.
You can reach Wayne at whippo@pssolutions.net

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