Managing costs in software development

Abstract

Software development companies are facing new challenges to develop competitive new products which must have innovative features, high quality, low time-to-market but also low cost in order to create competitive advantages over competitors. Two large software companies were investigated from the perspective of cost management in new product development (NPD). It was found that reusable components play an important role in cost management in NPD. A well-structured scalable architecture and design facilitate the modification and integration of components and a continuous integration and testing are methodologies used to turn development processes more agile. In addition, reverse engineering, analysis of nonfunctional requirements and inter-organizational cost management (I0CM) practices are important for effective cutting-costs activities. As companies grow, cost management grows more to the upstream of the product development process, optimizing the business. These results are important contributions to help other companies, especially high-tech startups, which are mainly focused on product development and little focused on cost management.