Consultancy accumulates knowledge
Many industries have a long tradition of outsourcing software development. However, as the world becomes more digital, the role of software is changing. Software is becoming an increasingly integral part of many business operations and a key factor for many companies’ competitive advantage. Today, more and more companies also employ their own software development teams.
When choosing between a turnkey delivery or a software consultancy, you should consider your core business and how the alternatives support your company’s strategy. Does the software project involve developing the very heart of your business? Or are you building a complementary business enabler that you want to get up and running quickly? Or is it both: at the heart of your strategy but want to accelerate your journey?
Having external software consultants working in close cooperation with your team allows you to build strategic in-house knowledge and skills. Your own experts get to learn the latest technological best practices and the consultants’ business insights from various fields applied to your business. This way, the knowledge accumulates within your company - something that might not happen in a turnkey delivery model.
Extra hands vs. independent teams
In the traditional software consultancy model, a partner provides a number of specialists that work alongside the customer’s own development team. This provides more capacity and competences resulting in the ability to do more in less time.
Today, hiring entire consultancy teams is becoming popular, too. A team can work independently on a specific part of a larger project. An independent team often results in less management overhead but might provide less opportunities for knowledge transfer between different teams.
In any case, the consultancy model requires that the customer company has the resources to lead the work by prioritizing development efforts and maintaining an overall vision of the product being built. This typically means business leadership in the form of a product owner.
TURNKEY DELIVERIES | CONSULTANCY MODEL |
Good for projects outside your core business. Requires less resources and involvement from the customer company. Fixed pricing and project scope makes change management challenging. Suitable for well-known solutions and productized offering For custom solutions often more expensive than other models | Accumulates knowledge within your organization. Requires capacity to lead the consultancy teams. Gives more flexibility and room for changes No risk-buffer baked in pricing Builds on undocumented trust which is a difficult notion in B2B Unorthodox way of purchasing for traditional industrial company purchasing departments |
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