For most ISVs, starting or running a business can be a daunting endeavour. Times are tough because of the competitive nature of the IT industry and disproportionately multiplying costs of software product development. As an owner of an ISV, you are keen to receive good value and see a return on your investments.
However, having a really great product idea and zeal to succeed is just not enough; increasing your Return on Investment (ROI) depends greatly on your ability to manage finances and handle company assets. Surprisingly, a large number of software entrepreneurs aren’t failing because of a lack of genius in their product. So how do you make sure your software development efforts are efficiently optimized and giving you the best return? There are 3 strategies to increase your software ROI: Talent, Technology and Infrastructure.
When you are first starting out, your first instincts would be to hire the best software specialists ever. You look for things such as an impressive work history, technology expertise, and incredible analytical skills, in an attempt to crush the market with the greatest product ever. While it seems logical that this could be the best way forward, this would not only mean steep costs, but also, your product would just take longer to launch because of the amount of time and effort such an activity would take.
Instead of trying to hire the greatest talent, try to engage an optimum resource mix which is basically an effective combination of top notch solution architects, mid level project managers and the actual developers who will carry out much of the legwork. An optimum blend of talent is important because having fresh and creative minds who can think outside the box is just as important as having proper direction and expertise in software development.
As an ISV, your first major shift should be from on-premise to Cloud-based software and hardware, which is typically delivered in a Software-as-a-Service format (SaaS). SaaS, which has been a highly popular software model for ISVs over the last decade, reduces the need for large on-premise installation projects.
It gives the development team freedom to work from any location in the world. In fact, an increasing number of ISVs are now adopting hybrid Cloud technologies in order to optimize cost as well as customize their computing power as per changing business needs and consumer demands. There is not only a definite cost advantage in putting your core tools on the Cloud or even extending your data centre to the Cloud, but it allows organizations of all sizes to have access to as much computing power as they need and, when they need it.
Office space can be a drain on resources for ISVs. Unfortunately, most landlords and real estate brokers expect unreasonably high lease terms and personal guarantees when renting an office. This is definitely not an ideal requirement for new companies who are looking to grow and avoid extra liabilities. There are several creative approaches you can take to minimize infrastructure spend:
Try outsourcing using an offshoring partner. Outsourcing allows you to simply ship off a part of your IT operations to a third party, which allows you to focus on your core business. The guiding principle of Cloud-as-a-Service is very similar to outsourcing. You not only get to save costs on overhead, but you are also free to focus entirely on your business.