3 Strategies to Reduce Software Development Costs in 2023

As the business world continues to evolve rapidly, staying competitive means being able to adapt and change at a moment’s notice. As the economy faces constant shifts, CFOs are tasked with the unenviable challenge of doing more with less — cutting costs while still driving growth and innovation.

In software development, this balancing act can be tough, as costs can spiral out of control if not properly managed. But fear not; there are ways to keep software development costs in check without sacrificing quality or stalling progress.

In this article, we will explore 3 key strategies you can implement in 2023 to reduce software development costs, maximize efficiencies and keep your company at the forefront of the industry. Implementing these strategies can help your company stay ahead of the curve and reach new heights of success.

So if you’re ready to start saving money on your software development projects in 2023, keep reading to learn more.

The Biggest Barrier to Reducing Software Development Costs

Perhaps the biggest barrier to reducing software development costs is monolithic architecture.

In a monolithic project, scaling software development work has a linear nature: as the size and complexity of a project increases, it takes more and more developers to complete the work. This results in a linear increase in development costs, as more developers must be hired or more resources must be allocated to the project. Moreover, the return on investment for these additional resources is often diminishing as the pace of new features and apps that are shipped only decreases over time.

In modern web app development, teams often work on the same project, share the same version, build pipeline and release cycle. While this has several advantages, this centralized approach can also lead to decreased productivity due to low visibility, conflicting work, and lengthy build times. This, in turn, makes it more complicated and more expensive to ship new features and apps.

Organizations can reduce software development costs through various approaches, such as outsourcing or adopting new work methodologies. Still, most of these approaches do not fundamentally change the linear cost equation created by the monolith.

Here are three examples of approaches that can improve your ROI, but have little to no impact on changing the linear cost equation:

1. Use of the Agile Software Development Methodology

Agile can improve the efficiency of development teams and make the process more flexible. Using Agile methodology, the development team breaks a project into smaller, more manageable sprints. During each sprint, the team focuses on delivering a specific set of features. The team also holds regular meetings to review progress, plan upcoming work, and identify any issues.

However, the development cost is still directly proportional to the effort. Even though the team is following an Agile methodology, unexpected changes in requirements or unforeseen complexity can lead to increased effort and cost. Therefore, even though Agile methodology can help optimize and make the development process more efficient, it’s unlikely to significantly reduce the overall development cost.

2. Outsourcing Software Development Work

There are a few options for outsourcing software development to reduce costs. One option is to hire remote developers, which allows access to a diverse talent pool and can help reduce the burden on your company by outsourcing specific tasks such as market research and planning. Another option is to build a tech team in a low-cost country, such as Sri Lanka, which can significantly reduce development costs.

However, it doesn’t fundamentally change the linear nature of software development work. The same number of developers is still required to complete the work, regardless of whether they work in-house or at a third-party vendor.

3. Using Open-Source Software

Using Open-Source Software (OSS) is another cost-effective way to develop software because it is free to use, modify, and distribute. Further, it has a large community of developers who contribute to the project and fix bugs, includes reusable code, and may be more secure than proprietary software.

While using OSS can undoubtedly help reduce costs associated with licensing, it still needs to change the amount of effort required to build, maintain and support the software. Therefore, OSS can lower certain expenses related to software development. Still, it needs to fundamentally change the cost equation. Additionally, even if OSS is free, it might still have hidden costs such as support, integrations, modification, and customization.

Flipping the Software Development Cost Equation

Overall, it’s important to recognize that the linear cost equation and the complexity created by the monolith is a fundamental challenge in reducing software development costs. There are several common cost-reduction approaches, but they have a minimal impact.

Therefore, what is needed are strategies that can help tackle the root of the cost problem: the monolith. Below are the three key strategies that address reducing software development risk, speeding up delivery, and decreasing the overall cost of development.

1. Transition to a Composable Architecture

Composable architecture is a software design approach that involves creating modular, reusable components that can be easily combined to build new systems. By using a component-driven development platform, such as Bit, this approach can help reduce software development costs in a few ways:

  • Reuse of code: Composable architecture encourages the reuse of code, which can save time and reduce development costs. Instead of writing new code for every project, developers can use existing components and focus on building the unique functionality required for each project. From the first composable component you create, every component becomes a digital asset for everyone in the organization.
  • Improved maintainability: Composable architecture can make maintaining and updating software systems easier because modular components can be updated and tested independently. This can reduce the cost of maintaining and updating the software over time.
  • Increased efficiency: Composable architecture can also increase the efficiency of the development process by allowing developers to work on smaller, focused components rather than on large, monolithic systems. This can reduce the time and cost of development.

Bit’s platform makes it simple to discover, reuse, and collaborate on components, ensuring that your codebase stays organized and consistent.

You can try Bit today and experience the benefits of building apps with composable architecture. → Learn more

2. Empower Greater Team Autonomy

Autonomous teams are groups of self-directed, cross-functional individuals with authority to make decisions and take responsibility for their work. This method can improve accountability and minimize the need for central management, resulting in more efficient and effective development processes.

By granting teams more autonomy, such as allowing them to work on independent, modular components, they can choose their tools and technology stack to deliver their work independently.

While it’s becoming more common for backend teams to have autonomy over specific microservices, allowing them to make decisions and take ownership of their work. A logical next step is to extend this autonomy to other parts of the codebase, such as Micro Frontends.

Overall, autonomous teams can help reduce software development costs:

  • Improved efficiency: Autonomous teams can often work more efficiently because they can make decisions and take ownership of their work. This can reduce the time and cost of development.
  • Increased accountability: Autonomous teams are responsible for their work, which can increase accountability and reduce the need for central management. This can lead to more efficient and effective development processes, lowering costs.
  • Reduced risk: Autonomous teams can better adapt to changing circumstances and make decisions on the fly, reducing the risk of errors and costly rework.

Tools like Bit can effectively achieve this, enabling teams to discover, share, and collaborate on components across the organization and projects. This improves the efficiency and consistency of the development process. Improving visibility, reducing conflicting work, and minimizing build times allow teams to deliver new features and experiences faster.

3. Distribute Your Design System

Design Systems are a great way to drive the reusability of core UI components, pushing down costs by sparing the various product teams the need to rewrite functionality. However, in practice, the creation, maintenance, and distribution of design systems are being done in a centralized, monolithic way. More often than not, design systems fail to address the diverse needs of teams and products, as they tend to be a “one-size-fits-all” library.

But what if you build and distribute independent components instead of a centralized UI library and process? This can include UI components, themes and tokens, icons, and more.

With a 100% component-based design system, where every component is independently versioned and published, developers can easily find, use, mix and match, and fit these components into their projects — at once or incrementally.

teambit / design: Bit’s Design system to use all across Bit’s products.

Using a platform like Bit, you can have a dedicated team develop your UI components to ensure standards and consistency, but at the same time, allow autonomous teams to innovate rapidly by having the flexibility to meet their specific needs and without being coupled to the design system team’s roadmap. Let autonomous teams innovate rapidly while standardizing components and design to ensure standards and consistency.

Incremental Improvements

One of the biggest strengths of these strategies is that they can be implemented incrementally.

You can start with a single team or project and gradually expand to the entire organization. For example, you can use bit components in an existing project and gradually move to a modular, distributed architecture with teams getting more and more autonomy.

→ Get Started with Bit

By decoupling components from your monolith and giving teams more autonomy, you’ll start seeing a cumulative effect on productivity while improving the overall developer experience.

Conclusion

This article discussed the main challenge in reducing software development costs and 3 highly effective strategies to address it in 2023. I hope that you will use these strategies and improve the efficiency of your software development teams.

Thank you for reading.

3 Strategies to Reduce Software Development Costs in 2023 was originally published in Bits and Pieces on Medium, where people are continuing the conversation by highlighting and responding to this story.


This content originally appeared on Bits and Pieces - Medium and was authored by Yasas Sri Wickramasinghe

As the business world continues to evolve rapidly, staying competitive means being able to adapt and change at a moment’s notice. As the economy faces constant shifts, CFOs are tasked with the unenviable challenge of doing more with less — cutting costs while still driving growth and innovation.

In software development, this balancing act can be tough, as costs can spiral out of control if not properly managed. But fear not; there are ways to keep software development costs in check without sacrificing quality or stalling progress.

In this article, we will explore 3 key strategies you can implement in 2023 to reduce software development costs, maximize efficiencies and keep your company at the forefront of the industry. Implementing these strategies can help your company stay ahead of the curve and reach new heights of success.

So if you’re ready to start saving money on your software development projects in 2023, keep reading to learn more.

The Biggest Barrier to Reducing Software Development Costs

Perhaps the biggest barrier to reducing software development costs is monolithic architecture.

In a monolithic project, scaling software development work has a linear nature: as the size and complexity of a project increases, it takes more and more developers to complete the work. This results in a linear increase in development costs, as more developers must be hired or more resources must be allocated to the project. Moreover, the return on investment for these additional resources is often diminishing as the pace of new features and apps that are shipped only decreases over time.

In modern web app development, teams often work on the same project, share the same version, build pipeline and release cycle. While this has several advantages, this centralized approach can also lead to decreased productivity due to low visibility, conflicting work, and lengthy build times. This, in turn, makes it more complicated and more expensive to ship new features and apps.

Organizations can reduce software development costs through various approaches, such as outsourcing or adopting new work methodologies. Still, most of these approaches do not fundamentally change the linear cost equation created by the monolith.

Here are three examples of approaches that can improve your ROI, but have little to no impact on changing the linear cost equation:

1. Use of the Agile Software Development Methodology

Agile can improve the efficiency of development teams and make the process more flexible. Using Agile methodology, the development team breaks a project into smaller, more manageable sprints. During each sprint, the team focuses on delivering a specific set of features. The team also holds regular meetings to review progress, plan upcoming work, and identify any issues.

However, the development cost is still directly proportional to the effort. Even though the team is following an Agile methodology, unexpected changes in requirements or unforeseen complexity can lead to increased effort and cost. Therefore, even though Agile methodology can help optimize and make the development process more efficient, it’s unlikely to significantly reduce the overall development cost.

2. Outsourcing Software Development Work

There are a few options for outsourcing software development to reduce costs. One option is to hire remote developers, which allows access to a diverse talent pool and can help reduce the burden on your company by outsourcing specific tasks such as market research and planning. Another option is to build a tech team in a low-cost country, such as Sri Lanka, which can significantly reduce development costs.

However, it doesn’t fundamentally change the linear nature of software development work. The same number of developers is still required to complete the work, regardless of whether they work in-house or at a third-party vendor.

3. Using Open-Source Software

Using Open-Source Software (OSS) is another cost-effective way to develop software because it is free to use, modify, and distribute. Further, it has a large community of developers who contribute to the project and fix bugs, includes reusable code, and may be more secure than proprietary software.

While using OSS can undoubtedly help reduce costs associated with licensing, it still needs to change the amount of effort required to build, maintain and support the software. Therefore, OSS can lower certain expenses related to software development. Still, it needs to fundamentally change the cost equation. Additionally, even if OSS is free, it might still have hidden costs such as support, integrations, modification, and customization.

Flipping the Software Development Cost Equation

Overall, it’s important to recognize that the linear cost equation and the complexity created by the monolith is a fundamental challenge in reducing software development costs. There are several common cost-reduction approaches, but they have a minimal impact.

Therefore, what is needed are strategies that can help tackle the root of the cost problem: the monolith. Below are the three key strategies that address reducing software development risk, speeding up delivery, and decreasing the overall cost of development.

1. Transition to a Composable Architecture

Composable architecture is a software design approach that involves creating modular, reusable components that can be easily combined to build new systems. By using a component-driven development platform, such as Bit, this approach can help reduce software development costs in a few ways:

  • Reuse of code: Composable architecture encourages the reuse of code, which can save time and reduce development costs. Instead of writing new code for every project, developers can use existing components and focus on building the unique functionality required for each project. From the first composable component you create, every component becomes a digital asset for everyone in the organization.
  • Improved maintainability: Composable architecture can make maintaining and updating software systems easier because modular components can be updated and tested independently. This can reduce the cost of maintaining and updating the software over time.
  • Increased efficiency: Composable architecture can also increase the efficiency of the development process by allowing developers to work on smaller, focused components rather than on large, monolithic systems. This can reduce the time and cost of development.

Bit’s platform makes it simple to discover, reuse, and collaborate on components, ensuring that your codebase stays organized and consistent.

You can try Bit today and experience the benefits of building apps with composable architecture. → Learn more

2. Empower Greater Team Autonomy

Autonomous teams are groups of self-directed, cross-functional individuals with authority to make decisions and take responsibility for their work. This method can improve accountability and minimize the need for central management, resulting in more efficient and effective development processes.

By granting teams more autonomy, such as allowing them to work on independent, modular components, they can choose their tools and technology stack to deliver their work independently.

While it’s becoming more common for backend teams to have autonomy over specific microservices, allowing them to make decisions and take ownership of their work. A logical next step is to extend this autonomy to other parts of the codebase, such as Micro Frontends.

Overall, autonomous teams can help reduce software development costs:

  • Improved efficiency: Autonomous teams can often work more efficiently because they can make decisions and take ownership of their work. This can reduce the time and cost of development.
  • Increased accountability: Autonomous teams are responsible for their work, which can increase accountability and reduce the need for central management. This can lead to more efficient and effective development processes, lowering costs.
  • Reduced risk: Autonomous teams can better adapt to changing circumstances and make decisions on the fly, reducing the risk of errors and costly rework.

Tools like Bit can effectively achieve this, enabling teams to discover, share, and collaborate on components across the organization and projects. This improves the efficiency and consistency of the development process. Improving visibility, reducing conflicting work, and minimizing build times allow teams to deliver new features and experiences faster.

3. Distribute Your Design System

Design Systems are a great way to drive the reusability of core UI components, pushing down costs by sparing the various product teams the need to rewrite functionality. However, in practice, the creation, maintenance, and distribution of design systems are being done in a centralized, monolithic way. More often than not, design systems fail to address the diverse needs of teams and products, as they tend to be a “one-size-fits-all” library.

But what if you build and distribute independent components instead of a centralized UI library and process? This can include UI components, themes and tokens, icons, and more.

With a 100% component-based design system, where every component is independently versioned and published, developers can easily find, use, mix and match, and fit these components into their projects — at once or incrementally.

teambit / design: Bit's Design system to use all across Bit's products.

Using a platform like Bit, you can have a dedicated team develop your UI components to ensure standards and consistency, but at the same time, allow autonomous teams to innovate rapidly by having the flexibility to meet their specific needs and without being coupled to the design system team’s roadmap. Let autonomous teams innovate rapidly while standardizing components and design to ensure standards and consistency.

Incremental Improvements

One of the biggest strengths of these strategies is that they can be implemented incrementally.

You can start with a single team or project and gradually expand to the entire organization. For example, you can use bit components in an existing project and gradually move to a modular, distributed architecture with teams getting more and more autonomy.

→ Get Started with Bit

By decoupling components from your monolith and giving teams more autonomy, you’ll start seeing a cumulative effect on productivity while improving the overall developer experience.

Conclusion

This article discussed the main challenge in reducing software development costs and 3 highly effective strategies to address it in 2023. I hope that you will use these strategies and improve the efficiency of your software development teams.

Thank you for reading.

3 Strategies to Reduce Software Development Costs in 2023 was originally published in Bits and Pieces on Medium, where people are continuing the conversation by highlighting and responding to this story.


This content originally appeared on Bits and Pieces - Medium and was authored by Yasas Sri Wickramasinghe


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