In-House or Outsourced Product Development?

Share via Whatsapp


In-House or Outsourced Product Development? Most of us face this question at one time or another. There’s no pat answer to the question. Each project has to be judged on its own merits, all the while taking company strategy into account, as well as current and future needs. Most importantly, the decision must not be based merely on the force of habit and fear of change, and certainly not “because that’s how we’ve always done it.”

By Amir Shiner, VP Medical Device Development, ARAN


In today’s world of constantly increasing competition, R&D departments are subjected to ever more pressure to get one innovative product after the other on the market as quickly as possible, and on more ambitious budgets than ever before.


Production outsourcing has caught on as a foremost alternative in a wide variety of industries, and nowadays quite a few companies base their operating strategy on manufacturers who work for them behind the scenes.


As for product development outsourcing, an increasing number of companies rely on external development services on a regular basis. The trend appears likely to become even more prevalent in the years to come.


A wise selection of the most suitable partner to undertake the task and meticulous, professional management is the best assurance for successfully completing a complex subcontracted development project – all the while adhering to budgetary targets, timetables, and quality requirements.


What are the main advantages of outsourcing product development?

– “Two are better than one, since they have a good reward for their toil” (Ecclesiastes4) – The adage is especially apt for everything pertaining to cutting-edge product development. A creative development team with broad industrial experience can come up with the right concepts and define the technologies necessary for implementing them.

– Delivery schedules often dictate the need to establish a skillful project team practically overnight, and not every company can handle extensive recruitment and training processes on short notice. Turning to an external development company in such cases provides an immediate, effective and professional response.

– Having an outside company manage project schedules and costs relieves the customer of expending its own management resources, helps reduce risks and cuts down significantly on development expenses.

Contribution to innovation – The most brilliant ideas and best solutions are frequently conceived by professionals who have a different background than the customer. Developers working for large professional service companies are continually exposed to a huge range of challenges in various realms and can apply their problem-solving talent and experience to projects even in realms new to them.

Safeguarding confidentiality and patents – Every patent resulting from subcontracting activity is the customer’s intellectual property. This ironclad rule must be paramount when selecting a partner. Contrary to popular belief, it is actually easier to maintain confidentiality and information continuity when working with a serious, professional external development company rather than with salaried employees who are here today and might be working in a rival firm tomorrow.


After the decision has been made to outsource a particular development project and the best-suited partner has been chosen, how is the process then managed? The three keys to effectively and successfully managing the project and the business relationship with the subcontractor are:

Communication, communication, communication.


This is a true partnership in every sense of the word, which requires keeping suspicions to a minimum and building long-term trust relations. Coordinating expectations throughout the entire project duration and maintaining open communication on both sides will ensure project success.


Aran’s engineers at your site

Our team of qualified, experienced engineers is proficient in providing Mechanical and Electronics engineering services at your site.
Using Aran’s Engineering Managed Services will enable you to shorten the product development cycle, lower cost and risk, and optimize utilization of resources and competitive edge in the market.

For more information contact:
Alex Mosalev, Account Manager
054-6645723 | 04-6239065