At Firefinch, we love working with innovative companies at the cutting edge of their industries. Whether you’re a biotech startup developing the next breakthrough therapy or a medtech company bringing a revolutionary device to market, you have brilliant ideas, ambitious plans, and incredible energy. But here’s what we’ve learned from working with dozens of these inspirational teams: having great internal expertise doesn’t automatically translate to knowing how to build successful outsourcing partnerships.

If you’re new to outsourcing or if this sounds familiar, read on.

Choose Partners Who Prioritise Value Over Ticking off Requirements

The biggest mistake we see companies make is treating outsourcing like a procurement exercise. They create detailed requirements documents, send them to vendors, and then select whoever promises to deliver everything on the list for the lowest price. This approach fundamentally misses the point of why you’re outsourcing in the first place.

“It wasn’t just a one-person engagement. We had access to software engineers, project leads, and even domain experts when needed.” – Client Quote

Requirements change. Priorities shift. Market conditions evolve. Your understanding of the problem deepens as you progress. A good outsourcing partner should be helping you navigate these changes and design the best possible outcome, not just delivering against a specification that was written before the work started.

Look for partners who ask probing questions about your business goals rather than just agreeing to your requirements.  

This means evaluating potential partners based on their ability to understand your domain, not just their technical capabilities.

Embrace Shorter Planning Cycles and Regular Reassessment 

One of the most common mistakes you can make is signing an 18-month development contract based on requirements you defined six months ago. The world moves too fast for that kind of rigid planning, especially in innovative industries where technology, regulations, and market conditions can shift rapidly.

Structure your partnerships around 4- to 6-month blocks of work that allow for regular reassessment and course correction. Each block should have clear deliverables and success criteria, but the overall roadmap should remain flexible enough to adapt to new information and changing priorities. 

This approach aligns well with agile development methodologies that have become standard in software development. The benefits of Agile apply to highly regulated industries too – standards development organisation AAMI supports agile development approaches (see TIR45:2023). 

This iterative approach allows bugs to be fixed early, users to test features before the whole release is ready, and teams to generate important feedback throughout the process. 

Regular reassessment points also give you natural opportunities to evaluate whether the partnership is working. If a vendor isn’t delivering value in the first 4-6 months, you can adjust or exit without being locked into a lengthy contract that no longer serves your needs. 

Implement Phased Planning with Clear Exit Strategies

How do you assess the competency of partners who provide experience in domains you’re not familiar with? Partners may be able to provide examples of previous work (NDAs permitting!), or testimonials. These often feel shallow compared to the trust required to engage in large projects.  

Instead, start with a small block of work or proof of concept before committing to larger engagements. This gives both parties a chance to evaluate the working relationship, communication styles, and technical capabilities in a low-risk environment 

Plan each phase with clear success criteria and decision points. What happens if the first phase doesn’t meet expectations? How will you transition work to a different partner if needed? Having these conversations upfront might feel uncomfortable, but it protects both parties and tends to improve performance because everyone understands the stakes.

“Firefinch understood what we needed better than we did. They didn’t just build what we asked for, they helped us figure out what was actually required.”  – Client Quote

This phased approach also allows you to validate that your partner truly understands your domain. Technical competence isn’t enough – they need to understand your regulatory environment, your user needs, and your business constraints. A partner who demonstrates this understanding in a small project is much more likely to deliver value in a larger engagement. 

Demand Strategic Planning, Not Just Task Execution

Too many outsourcing relationships devolve into glorified staff augmentation – you provide detailed specifications and your partner provides people to implement them at an hourly rate. This approach misses the strategic value that external partners can provide.

The best outsourcing partners act as strategic advisors who help you plan for the future, not just execute today’s tasks. They should understand your regulatory environment, anticipate future requirements, and help you build sustainable solutions that can evolve over time. They should anticipate how changes in standards like IEC 62304 might affect your software. They should help you plan for scalability challenges before you have 10,000 devices in the field.

This kind of strategic value requires partners who invest in understanding your industry, not just your current project. Look for partners who attend industry conferences, understand regulatory trends, and have deep experience with the specific challenges you face. 

“..software they built scaled with us seamlessly. We’ve grown fast, and it’s never held us back. It’s grown right alongside us.” – Client Quote

Evaluate Domain Knowledge and Proven Experience

Domain expertise should be your primary filter when evaluating potential partners, even before technical skills. A brilliant developer who doesn’t understand your industry will make costly mistakes that an experienced domain expert would never make 

Ask potential partners for specific case studies from your industry. If you’re developing medical device software, you want to see evidence of successful regulatory submissions, not just impressive mobile apps. If you’re in biotech, you want partners who understand laboratory workflows and data integrity requirements, not just cloud architecture 

“Instead of hiring a full in-house team, we were able to tap into Firefinch’s broad expertise right away. It gave us immediate access to the skills we needed without the recruitment overhead.” – Client Quote

Prioritise Communication and Collaborative Processes

Effective communication becomes even more critical when working with external partners, especially if there are geographic or cultural differences involved. At Firefinch, our number one indicator of a problem arising is when we or the client start to feel like we don’t know what’s going on. 

The most successful outsourcing relationships have structured, transparent communication processes that keep everyone aligned and responsive to change. 

Implement regular touchpoints like daily standups, weekly demos, and monthly retrospectives. Use collaborative tools that give you real-time visibility into progress and allow for quick feedback and course correction. The goal is to make the external team feel like a natural extension of your internal team, not a separate entity working in isolation 

Don’t underestimate the importance of cultural fit and communication style. Technical skills can be developed, but fundamental misalignments in how teams prefer to work and communicate can derail even the most promising partnerships. Spend time during the evaluation process understanding how potential partners prefer to communicate and whether that aligns with your team’s style 

“It feels like they’re part of our team, not just a vendor. We have regular calls, fast turnarounds, and they genuinely care about our success.” – Client Quote

Consider the time zone implications if you’re working with offshore partners. While cost arbitrage can be attractive, the communication overhead of working across significant time zone differences can offset much of the financial benefit, especially for projects requiring frequent collaboration and rapid iteration. 

Establish Clear Governance for Multi-Vendor Relationships

When you’re working with an ecosystem of specialist partners, coordination becomes critical. Without clear governance structures, you can end up with finger-pointing, duplicated effort, and integration challenges that negate the benefits of the specialist approach 

Consider appointing a lead contractor who takes responsibility for coordinating the work of multiple vendors. This might be your most strategic partner or the vendor handling the largest portion of the work. Alternatively, you might choose to maintain governance internally, but make sure you have someone with the bandwidth and expertise to manage multiple vendor relationships effectively. 

Establish clear protocols for how vendors will communicate with each other, share information, and escalate issues. Define who has decision-making authority for different types of choices. Create shared project management structures that give everyone visibility into dependencies and timelines. 

The governance structure should also include regular reviews of the overall ecosystem performance, not just individual vendor performance. Are the vendors working well together? Are there gaps or overlaps in coverage? Is the overall solution meeting your business objectives? This ecosystem-level view is critical for optimising the value you get from your outsourcing investments. 

Plan for Knowledge Transfer and Future Independence

One of the biggest risks in outsourcing relationships is vendor lock-in – becoming so dependent on external partners that you lose the ability to adapt or change direction. The best partnerships actually strengthen your internal capabilities over time rather than making you more dependent 

Insist that your partners document their work thoroughly and provide regular knowledge transfer to your internal team. This shouldn’t be a one-time handoff at the end of the project, but an ongoing process throughout the engagement. Your internal team should understand the architectural decisions, be able to maintain and extend the work, and have the knowledge needed to work with different partners in the future. 

Consider requiring your partners to train internal team members as part of the engagement. This investment in knowledge transfer pays dividends in reduced dependency and increased internal capability.