Build Operate Transfer (BOT) Model in Software Outsourcing

In the era of fast technological transformations in every vertical, the businesses look for a less traditional means to fill the technical gap related to software development. Build Operate Transfer (BOT) model offers businesses with perfect opportunity to produce a long-term technical resource and help them overcome the challenges related to development resources. While software outsourcing remains a possible option, the BOT model is set to gain popularity in the future.

What is the Build Operate Transfer (BOT) model?

As a company grows, the need for product innovations and investments in new technologies increases. In addition to new technological investments, other operational priorities also put pressure on the cash availability of the companies. In such scenarios, the BOT model can be of great help. The model is used to finance large projects due to which it has gained popularity as a project financing methodology.

BOT is a contractual model in which a business entity hires a service provider to finance, build, and operate a facility or business operation often in a new country. For an IT company, the service provider is often hired to set up, optimize, and run an IT processor to develop new software. In the BOT model, after a specific period of the contract, the ownership is transferred to the client.

“The BOT model is a proven effective strategy for businesses that are planning to set-up a new entity or expand geographically.”

Three phases of BOT model:

Build

This phase involves setting up of an operational unit. This incorporates infrastructure such as buildings and IT devices.

Operate

This phase comprises program management, enhancement, maintenance, upgrades and product support.

Transfer

In this phase, the ownership of the project is transferred from the outsourcing partner to the client.

Build
This phase involves setting up of an operational unit. This incorporates infrastructure such as buildings and IT devices.
Operate
This phase comprises program management, enhancement, maintenance, upgrades and product support.
Transfer
In this phase, the ownership of the project is transferred from the outsourcing partner to the client.
Key benefits of the BOT model for software outsourcing:
  • Reduced Time to Market: BOT model for software outsourcing utilize vendor’s capabilities and existing software development environment, which significantly lowers the software development time.
  • Cost-effectiveness: In BOT-based software development arrangement, the outsourcing partner sets up the offshore team, takes it to an entirely operative level, and then legally transfers the subsidiary to the client after a certain period of time. This model provides the cost and efficiency of traditional IT outsourcing while allowing the client to maintain control of its intellectual property.
  • Low Risk: It gives the client the option of canceling the software development at the short notice and pays only for the used resources and time, thereby avoiding any added liquidating costs.
  • Lower Establishment Costs: BOT model eradicates the requirement of initial investments needed for setting up a new development center.
  • Process Expertise: Increases the chances of successful software development by using the knowledge of specialists in the selected region. The BOT model would help to produce value from the first day of development as the selected vendor would already have experience and employees skilled in the required technology and business areas.
Why should you consider the BOT model for software outsourcing?

Using the BOT model for software outsourcing, the businesses can build a trustworthy long term development resource that delivers high-quality technical output at a comparatively low cost. This will help businesses to overcome the talent shortage and make the right skills available for rapid growth. While the vendor is focused on developing software of the company, the later can focus on developing and enhancing its core business.

Further, the BOT model would efficiently save time and money by providing more short term and long term cost saving, thereby helping minimize the cost over a period of time.

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Want to outsource using the BOT model? Jellyfish Technologies has you covered.

Jellyfish Technologies helps clients in creating business-specific procedures to achieve intelligent digital operations, across the globe. With our hands-on diverse business verticals and a team of skilled IT experts, we create effective solutions to increase productivity and value. Our specialists will be happy to discuss with you the benefits of using the BOT model for your case. For further discussion feel free to contact us.

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