Methods to Reduce Software Development Cost

software developmentA major area of concern for software engineers is the cost of developing custom applications. Software development costs can be greatly reduced by applying methods to make the system design flexible and versatile.

The first step in understanding how to reduce software development cost is to understand where those costs come from. Here are some areas that contribute significantly to the overall cost of developing custom software:


Personnel Training

Training for the development team must be provided in order to develop an application. This training includes instruction in both the underlying technologies and the methodology that will be used by the development team. The base cost of this training is often overlooked by those who are not experienced in software development. The cost of training includes both the direct costs of providing training and the indirect costs of lost productivity while team members are in training.

Training is typically provided by an outsourced partner or through a third party vendor/service provider. This additional cost may not be easily quantifiable, but should be understood during the development process. Your main objective is to minimize your training cost by providing your partner or vendor with the tools and resources that they need.

Training can also be provided by the development team itself. This is very common when developing in-house applications. Developers will often learn new technologies and methodologies through self-study or by attending local meetups, user groups, conferences, etc .


Development Tools

Software developers use a number of tools to develop software applications. These tools include version control software, issue tracking tools, task management applications, requirements tracking and management tools, defect tracking tools, source code control systems etc. The cost of these tools needs to be considered during the development process.

These costs will vary depending on the development team’s needs. Some teams may use a common set of standard tools for all projects while others may need highly customized solutions.

The cost of these tools is usually built into the overall development costs. This may result in higher than actual costs, but can help to ensure that a large number of developers can easily utilize these applications and reduce their training time.


Architecture and Design Costs

The architecture and design phase is one of the most important phases of the development process. Poor architecture and design decisions will have a direct impact on the cost of developing custom software.

The cost of this phase is often overlooked because it is not directly associated with the actual coding that takes place during the development process. This leads to poor application designs which result in increased coding costs, higher defect rates, maintenance costs, etc.

The cost of this phase is greatly impacted by the overall approach used to develop the solution. Agile approaches may require less detailed architecture documentation, but may result in higher design costs due to the increased need for architecting and designing more complex applications. Waterfall approaches have traditionally focused on documenting every requirement before developing a single line of code, which results in higher design costs.

Design only occurs after the requirements are documented and must be completed before development can begin.

The best approach is to define a balance between architecture requirements and coded design at an early stage of the project as part of the initial planning process . Pushing an excessive amount of design documentation throughout the project will overcomplicate the development process, while not creating enough design detail may result in less than optimal solutions.


Design Cost Example

An example design cost is hard to quantify due to the wide range of requirements documentation and code samples that can be used as part of an application architecture or design phase. The key objective here is to ensure that at a minimum your solution complies with industry best practices.

Developing software is a complex process that can result in high costs if not managed properly. An upfront focus on reducing these development costs will have a direct impact on increasing your returns and overall profits .

The best way to reduce your application development costs is to understand and plan for the various processes involved. This will help to ensure that your development team (and budget) is as efficient as possible .



Methods to Reduce Software Development Costs

The following are some of the key methods for reducing software development costs.


Manage your Project Properly

An indirect method of reducing software development costs is to ensure that you manage your project properly. This means setting realistic goals and deadlines, managing the work load of the developers, identifying potential issues early in the process, and adjusting timelines as needed, etc.

This may be one of the most difficult methods for reducing development costs since it requires a lot of attention to detail and ongoing project management. Developing custom software involves a number of complex processes and certain patterns will inevitably emerge over time such as poor code quality, high defect rates, slow deployment times, etc. Identifying these situations early and addressing them immediately will always result in a greater ROI.


Working with Agile or Waterfall

The methods used to manage your software development project can have a significant impact on the overall cost of developing your application, as explained above. For this reason, using an agile approach for managing your project is going to be more flexible and cheaper in the long run.

Agile approaches focus on prioritizing work and shifting priorities earlier in the project, while following a flexible development process that allows changes to be made as needed. This approach is more cost efficient because changes are less likely to result in rework or additional costs due to shifting deadlines or objectives . Waterfall approaches tend to have more upfront costs and are not as flexible, which can make it more expensive for you to adapt or pivot when needed. For these reasons, agile is the preferred approach for most companies .


Understand Your Options

While certain factors will directly impact the cost of developing an application such as the number of features required or the number of developers working on a project, you will also want to be sure that you are using the most efficient technologies for your needs. Choosing the right database (relational vs. non-relational), platform (Java vs. .Net) or frameworks (Spring vs. Hibernate) can have a significant impact on the time and cost of developing an application.

Another area of importance is the various available options for deployment. It is important to understand your options so that you can make an informed decision about how best to deploy your application and get it up and running as quickly as possible.

This includes: understanding your development environment (e.g., Linux, Windows) and what operating systems are compatible; understanding how your application is going to be deployed and where it will run (e.g., cloud, server, desktop); choosing the appropriate development platform or programming language; etc.


Planning for Quality

Testing properly and following a good development process are both cost effective methods of ensuring that you have a solid application with minimal defects .

In most cases, thorough testing helps to identify defects early in the process and allows for quick fixes that will not require any significant rework. This is especially true if you are using agile or iterative development methods .

Similarly, following a good development process such as test-driven development (TDD), which requires developers to write unit tests during the development process, will help ensure that all components have been tested and provide a level of quality assurance after deployment .




Reducing the cost of developing your application may require adjusting timelines and resources, changing development methodologies, making appropriate technology choices or reducing the amount of time that you need to deploy. While there are numerous ways to reduce the costs associated with developing your custom software, having a solid understanding of how these factors will affect your specific project is essential for making an informed decision about how to proceed. In general, choosing agile development methods, which allow for flexibility and change throughout the project will provide you with a higher return on your investment.


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