Software Development as a Service: What Is It and How to Use It?

22 June 2022

Liubomyr Sirskyi

Content Manager

Have you ever thought about creating a web or mobile app? Do you want it to promote an internal solution or present a new business product? In this case, you should hire a developer or an entire team to create an application for your needs. However, a small number of companies have in-house developers to assign the project, so you need to look for another option. And if you want to get a quality product and save resources, Software Development as a Service (SDaaS) may be the best option. 

Custom software development specialists are discussing a project in an office environment.

What is Software Development as a Service?

Simply put, the SDaaS model means delegating software development to a third-party contractor—from subcontracting separate freelancers to hiring a dedicated team that will solely focus on your project and business requirements.

The model has a wide range of applications, from implementing additional features to an already existing product to starting a new project from product discovery. The only limitations are the client’s budget and the vendor’s experience and areas of expertise. 

Hiring a software development services provider saves businesses time and money. The contractor company undertakes the search for specialists, remuneration, and workflow design (in-office or remotely). The client provides their vision of the product and the features they want to see. 

Types of SDaaS Firms

Software-Development-as-a-Service companies offer a different set of services and working approaches. But there are two most popular types of such businesses. 

Service-Based Companies

Service-based companies are also known as IT outsourcing or IT consultancy vendors. In other words, these companies provide custom software development services. It means every project has an external client with the objective and requirements.  

There are multiple reasons why a custom software development firm can help your business; here are some of them: 

  • A highly skilled talent pool;
  • Favourable hourly rates;
  • Technical and business consultancy;
  • Client-oriented approach;
  • Multi-niche market expertise;
  • Various tech stacks.

Product-Based Companies

As the name suggests, these companies develop and sell their own digital products and software solutions. It means they do not have external customers to initiate product development. They also do their customer research and create marketing strategies to promote and sell their product to as many end-users as possible. It can be any digital product, from desktop to mobile and web applications for B2B and B2C clients. The most illustrative examples are Google, Apple, and Microsoft and their products dominating the global market.

Which Option Should You Choose?

If you decide to get a digital product with standard functionality, it is better to select a product-based firm. They will offer you a ready-made solution. Some of them can even be customizable. However, adding extra features and higher personalization are usually only available on the enterprise level and cost a lot.

When you need to get customized software, you should hire a service-based business. This option is efficient and flexible, so it can be useful for those who need a product with specific functionality.

In addition to the SDaaS, SaaS technology covers custom cloud apps with a monthly fee. Learn more about creating a turnkey SaaS platform here

Advantages of SDaaS Model

This option allows you to interact with your dedicated software development team as if it were your development staff. When choosing SDaaS, you can use the best technical knowledge at a reasonable price. Let’s examine the seven benefits of this model.

High Resource Efficiency

If you are on tight deadlines or need to implement several features simultaneously, it is challenging to avoid resource limitations. With SDaaS, you can get the best specialists without hiring them. Moreover, the Software Development as a Service model helps you build better relationships with your dedicated team. The secret is the advanced communication with developers. You can improve it by providing consistent feedback, setting a clear agenda for each meeting, organizing one-to-one weekly video calls, and many other practices. 

Transparency and Scalability

Modern IT businesses stand out with their agile nature, benefitting them with scalability and transparency. Unlike leveraging off-the-shelf products, the SDaaS model allows you to pay only for the features your project requires. Further, SDaaS service vendors provide a clear budget estimation for each project according to your requirements and a comprehensive report about the team’s performance.

Software-Development-as-a-Service companies provide an option for scalability. Market conditions are constantly changing, so you can ask a custom developer for help and replace software elements. Besides, you can improve direct communication with the team by giving them feedback faster.

Direct Access to Highly Skilled Professionals

Many SDaaS firms have extensive experience in various domains, from simple e-commerce products to complex Fintech solutions. They involve expert developers, QA engineers, UI/UX designers, and others to tackle new challenges and close the gap between the customer company and the bespoke software development team.  

A New Word in the Recruitment Process

Hiring and onboarding is a long and complex process that requires time and resources. But SDaaS company can offer you a unique pool of talents. 

You can ask for a list of high-level employees and select the most suitable ones for your project. If you don’t have the necessary tech expertise to evaluate the candidates’ skills, the vendor’s HRs and PMs will suggest the best-fitting professionals. Plus, you can follow the development progress and decide on reducing or increasing the number of people in your dedicated team. 

Stability and Security

They are the main requirements of application performance at every development stage. Therefore, your custom application development company should use manual and automatic testing methods to detect bugs and fix them before a product release.

Furthermore, creating unique solutions from scratch requires three vital things:

  • Compliance with industry standards;
  • Using the best software development approaches;
  • Considering possible risks.

Following the latest cybersecurity standards is crucial for a custom software development company as it handles clients’ sensitive information.

Comprehensive QA Processes

SDaaS service providers hire dedicated QA specialists that evaluate work results after each iteration, use manual and automated testing techniques, and perform user acceptance testing. After that, they analyze the results and conclude the completion of the product. An established QA process is usually an indication of the vendor’s maturity and experience.

Reduced Time to Market

The latest best practices include a quick MVP launch and feedback collection to implement new features. Therefore, in the case of SDaaS, you release a relevant product that meets current market conditions.

How Does the SDaaS Model Differ From Classic Outsourcing?

At first sight, both concepts are similar. However, the Software Development as a Service model has significant differences that make it a good choice for business. Let’s look at three key characteristics.

Fast and Scalable Enhancements

When choosing the SDaaS model for a long-term relationship, your team already knows your product and requirements. Hence, it can release updates faster than the outsourced team, which needs to be familiarized with the product in detail. 

Maintenance and Support

The best SDaaS representatives do not leave customers alone after the product launch. And if something happens to you, your trusted tech partners will help solve the problem.

IT outsourcing does not always consider communication risks. Thus, you may not verify the expertise of bespoke software development companies. Moreover, standard outsourcing teams often focus on project completion rather than product performance, resulting in reduced quality assurance. At the same time, SDaaS focuses on the product and business success.

Project Monitoring

IT outsourcing covers one-off tasks without the maintenance of the bespoke systems. However, the Software Development as a Service company performs daily checks to ensure the flawless performance of your development process. It also helps you avoid delays in product delivery. Project managers of the SDaaS vendor provide reports on the work done to track the development progress.

A Comprehensive Flexibility

If the conditions and budget change in the client company, a good custom development provider will find a way to adjust the project to the budget. Vendors also expand or narrow the team, depending on current conditions. Plus, custom developers adapt to the business requirements (as well as SaaS solutions development).

Predictable Estimates

At first, it may seem that a one-time outsourcing collaboration will cost a little. However, the Software-Development-as-a-Service model provides a long-term relationship with a previously agreed budget. Any changes are communicated and agreed upon as part of a standard contract. It allows you to get the desired results in the expected time frame.


You can turn your project into an efficient and time-saving event. The secret is extending your business by hiring a dedicated team with extensive experience in managing complex software development projects.

The Software-Development-as-a-Service approach is a reasonable choice for founders and C-level executives who need to delegate difficult tech aspects and focus solely on their business.

Looking for an experienced tech partner to delegate software development?
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