When a CIO or CMO greenlights the development of a new digital product like a mobile app or a website, there are many decisions for the product management team to make. Of all of those, one of the most important questions will be: “Should we attempt this with internal development resources, or should we bring in an outside development agency?” Here are a few thoughts that can help make that decision easier.

Agencies need to keep up with bleeding-edge industry trends

Reading the blog and marketing materials that an agency publishes will help a CMO or CIO stay informed, and it goes without saying that a potential development partner should indeed be producing evidence that they synthesize and embrace new trends in their industry. Strong agencies have an abundance of knowledge and access to influencers in the marketplace. As part of their business, agencies need to continually attend and participate in digital marketing conferences and work hard to maintain thought leadership.

However, these are all channels that are publicly facing, and offer knowledge anyone can access without signing a long-term agreement to work together. So why is up-to-date knowledge important? It’s inevitable that, in the middle of a product development cycle, these two things will almost certainly happen:

Another company or competitor will release a well-regarded new product that features a key innovation to add value to consumers. This new product will necessarily influence the reception of any other product released that doesn’t feature that innovation—try releasing a non-responsive website in 2017, for example.
Apple, Google, or Facebook—or any of a dozen other market-makers—release an update to their operating system, their browser, or a new piece of hardware that will substantially impact the design and development of the mobile product before it’s finished.

In a rapidly changing technology space, it is critical to have a partner who can absorb and quickly react to these trends. In fact, it’s even better to have an agency partner who can anticipate and proactively address these trends before they happen. A strong agency consultant will offer an informed perspective on their clients’ positions relative to new innovations and ideas, and will help clients determine which changes are good investments and which others aren’t fully ready for prime time. Agencies speak with hundreds of organizations to discuss a wide variety of diverse projects over the course of a year, so they must keep up-to-date to stay relevant. They’ve undoubtedly been approached with similar projects before, and so their teams have already done some unique research on the topic.

In a rapidly changing technology space, it is critical to have a partner who can absorb and quickly react to these trends. In fact, it’s even better to have an agency partner who can anticipate and proactively address these trends before they happen.

Having the right partner can mitigate the risk of having to adapt to external change from a process standpoint. A good agency can bring in additional team members with new expertise in technology and marketing to help a project that may need to be pivoted. Relying on internal resources may not provide the full skill set needed.

An agency partner is best equipped to offer UX insight

When using only internal resources to drive product development, there is a natural tendency to develop an echo chamber when team members are working together over a long period. These team resources support the “party line,” are more likely to support established UX ideas from their colleagues and superiors, and are incented to avoid disagreements or debates about the best UX direction. While a manager may think they are putting together a product team with diverse insights, over time these differences in opinion erode through shared work within a single company environment.

Melissa Douros, Senior Manager of Digital UX at Discover, had this to say about the benefits of outside perspectives. “When we listen to people who don’t think the same as we do, it starts a conversation which pushes us to think different and ultimately grow.”

An agency can straddle the line between bringing an outside perspective to product development while still being interested in that product’s rapid deployment and success. They are able to objectively advocate for end users, a role that can’t be filled by an organization’s current employees due to institutional pressures and biases. There may be a bit of discomfort with insight provided by an outside group, but ultimately it will yield large benefits to the project.

Agencies attract the best technical talent

CIOs and CMOs are painfully aware that there is a struggle for technology talent across the board. CIO.com reports that 49% of companies expect IT talent shortage in 2016. For those organizations fortunate to have strong technical talent in-house, there will always be a long line of internal teams waiting for their time. But that’s hardly every company, and most are accustomed to jostling with other departments to get IT attention on their project..

Agencies are typically able to attract talent with flexible working conditions, unique perks, and the opportunity to focus on innovative technologies across a diverse range of client projects. Software development can be repetitive and tedious for engineers in a single-brand environment, while agencies offer their developers an opportunity to work on a variety of projects to break up the monotony, challenge their skills, and provide growth or learning opportunities. Agencies also have the opportunity to hire software developers at any experience level and accelerate their growth through hands-on mentoring, placing the appropriate developer talent and expertise on those projects which demand it—a luxury that many brands cannot afford or don’t have time to explore.

If time to market is important, an agency is typically best equipped to move quickly

This is also related to the previous point: strong agencies are hiring machines, having the ability to hire quickly and handle the rapid sourcing and assessment of technical contributors when projects have to scale up effort quickly. They anticipate when active projects need to augment a team and are prepared to move agilely when new projects begin. These agencies maintain a bench of developer and UX talent, and thereby are able to offer great training and opportunities to develop thought leadership as mentioned above.

The elephant in the room—cost

While an internal team may appear not to require the same budgeting and procurement processes that paying an agency would, clearly it’s inaccurate to say that internal resources come for free. As a leader of an organization, it would be absurd to think that employee time and effort cost nothing. These are internal resources with institutional knowledge, experience, and access that are unique and should be treated accordingly. Even when engaging an outside partner, these internal resources play a critical role in making this partnership work.

There are many different types of agencies to partner with for digital product development. This includes offshore firms that drive costs down by employing developers in countries with currency exchange favorable to the United States. Though there are downsides to this kind of engagement, it is a way to get work done with a reduced topline cost.

However, to get the benefits of the agencies described above an organization will need to take a holistic view of cost. Frequently, using a strong agency partner will appear to cost more. Obviously, staffing top talent isn’t cheap, and offering premium services is invaluable. But what about opportunity cost?

In a crowded marketplace where customers have numerous choices at their fingertips, it’s not enough to satisfy minimum requirements for what constitutes a mobile app or website. Only truly innovative companies and organizations now earn users’ engagement. To generate new users or to more closely engage current users, it’s a necessity for a digital product to offer unique value and innovative new experiences. And while a great app or website is certainly possible for internal development teams to deliver, sometimes it makes the most sense to hire a team that specializes in delivering exactly that.

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