Matt Paige Digital Insights https://hatchworks.com/author/matt-paigehatchworks-com/ Your US-based Nearshore software development partner Mon, 08 Jan 2024 23:21:54 +0000 en-US hourly 1 https://wordpress.org/?v=6.4.2 https://hatchworks.com/wp-content/uploads/2021/04/hatchworks-favicon-150x150.png Matt Paige Digital Insights https://hatchworks.com/author/matt-paigehatchworks-com/ 32 32 Generative AI Use Case Trends Across Industries: A Strategic Report https://hatchworks.com/blog/software-development/generative-ai-use-cases/ Wed, 25 Oct 2023 18:41:13 +0000 https://hatchworks.com/?p=30149 It’s not a matter of if generative AI will impact an industry, it is a matter of how large the impact will be. McKinsey research found that generative AI (gen AI) features stand to add up to $4.4 trillion to the global economy annually. That is a trillion with a “T”. This advancement in AI […]

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It’s not a matter of if generative AI will impact an industry, it is a matter of how large the impact will be. McKinsey research found that generative AI (gen AI) features stand to add up to $4.4 trillion to the global economy annually. That is a trillion with a “T”. This advancement in AI is redefining the way industries operate, unleashing a wave of transformative capabilities that were once the stuff of science fiction.
A graphic titled "Generative AI Use Case Trends Across Industries" by HatchWorks.

Generative AI, is a subset of machine learning that focuses on teaching computers to generate content based on existing data. From art and language to problem-solving and creativity, Generative AI is proving to be a game-changer across numerous sectors.

The sheer volume of potential AI use cases generative AI enables can be mind-boggling. Whether you’re a healthcare professional seeking more accurate diagnoses, a financial analyst navigating complex markets, a marketer aiming to captivate audiences, or an educator striving for personalized learning experiences, Generative AI has something profound to offer.

Why does understanding the top use cases of Generative AI matter? For businesses, it presents an opportunity for innovation and efficiency, enabling them to stay competitive in a rapidly evolving world. For individuals, it opens doors to new possibilities, augmenting their capabilities and enhancing their quality of life.

This article will serve as your comprehensive guide to the top Generative AI use cases across industries. We will explore how this technology is reshaping the way we work, create, and live.

Here’s what to expect:

Retail and E-commerce: Elevating Shopping Experiences with Generative AI

Retail and AI:

Staying ahead of consumer expectations is crucial in retail and E-commerce, and Generative AI may be the key to achieving that. The combination of retail and AI is redefining the shopping experience, making it more personalized, efficient, and engaging.

In this section, we’ll explore how Generative AI is revolutionizing retail and e-commerce, from optimizing inventory management to delivering tailored product recommendations and enabling visual product searches.

Inventory Management:

Effective inventory management is a balancing act between meeting customer demand and minimizing holding costs. Generative AI excels in this domain by analyzing historical sales data, demand forecasts, and market trends. AI algorithms can predict future demand with precision, allowing retailers to optimize their inventory levels.

The real unlock is the ability to query these enormous data sets with natural language, making it effortless to draw insights and take action. This not only reduces the risk of overstocking or understocking but also ensures that products are available when customers want them, enhancing overall customer satisfaction.

Shopping Experience:

The shopping experience is about to get a facelift with generative AI. Walmart is already bringing this technology to its customers by helping shoppers in all stages of the shopping experience from search and discovery to making a purchase. This includes features like a shopping assistant, gen-AI powered search, and an interior design feature helping you virtually design your room.

A digital interface displaying a festively decorated room with a focus on holiday decor. The left side contains chat-style interactions suggesting products within a budget and discussing options, while the right side showcases the room with price tags on individual items like a silver wreath, Christmas tree, stockings, a red throw blanket, and more. At the bottom right, buttons are present to show prices, add the room to cart, and save the room design.
An interactive holiday room decor shopping interface, combining chatbot suggestions and visual product pricing for an immersive user experience.

“Generative AI technology is a priority for the company,” said the Walmart spokesperson.

This is going to enable a truly personalized shopping experience that is interactive, conversational, and multi-dimensional.

Visual Search:

Search is about to get a lot easier. This Gen-AI advancement will transform how consumers find products in the digital world. By analyzing images and patterns, AI can identify products similar to those in a user’s photos or descriptions. This enables users to simply snap a picture or describe an item and receive relevant product suggestions.

While Google will certainly be playing at the forefront of this functionality, others are also taking advantage. SnapChat recently announced its rollout of Visual Search. This functionality will allow users to search for products on Amazon simply by simply focusing their camera on a product or barcode and snapping a picture.

A sequence of three mobile screenshots depicting the process of using an image search feature. The first screenshot shows a close-up of someone's foot wearing a white Under Armour shoe. The second screenshot displays a "Searching..." In the third screenshot, a popup from Amazon displays the shoe as "Under Armour Men's HOVR Sonic" priced at $100.00, along with its rating.
Image recognition search process in action: from capturing an Under Armour shoe, identifying it, to presenting the exact match on Amazon.

Visual search enhances the convenience and speed of finding products, making the shopping process smoother and more enjoyable.

The integration of Generative AI into retail and e-commerce is not just about optimizing operations; it’s about creating a shopping experience that resonates with customers, fostering loyalty and driving growth. It’s a testament to the technology’s ability to enhance how we discover and acquire the products we love.

Next, we’ll explore how Generative AI is shaping the landscape of education and e-learning, where personalized learning is paramount.

Healthcare Industry: Improving Patient Outcomes Through Gen-AI

Healthcare and AI:

In the healthcare industry, where precision and speed can be a matter of life and death, Generative AI has the potential to be a powerful ally. However, considering some AI use cases do involve human life, proceeding with caution is paramount. The key is to identify AI use cases that have an outsized benefit relative to the potential risk to the patient.

AI-Driven Diagnostics:

One of the most remarkable applications of Generative AI in healthcare is in diagnostics. Traditional diagnostic methods often rely on human interpretation of medical data, such as images and patient histories. This can take a long time. Generative AI, powered by advanced machine learning algorithms, revolutionizes this process.

By analyzing vast datasets of medical records, images, and patient data, artificial intelligence can identify intricate patterns and subtle anomalies that might elude human perception. This not only accelerates the diagnostic timeline but also elevates accuracy to unprecedented levels. Patients benefit from timely and precise diagnoses, which can be crucial in cases where early intervention is essential.

HCA Healthcare is piloting a solution that extracts information from physician-patient conversations to create medical notes. These notes are then transferred to the electronic health record (EHR) helping eliminate manual entry and dictation freeing the doctor up to focus on the patient.

Drug Discovery and Development:

The process of discovering and developing new drugs is notoriously lengthy, complex, and expensive. Generative AI is poised to change this paradigm. By simulating molecular interactions and predicting potential drug candidates, artificial intelligence expedites drug discovery.

This not only accelerates innovation but also reduces the costs associated with research and development. The result is a faster pipeline for bringing life-saving therapies to market. Generative AI is, in essence, a catalyst for groundbreaking medical advancements.

Personalized Treatment Plans:

Every patient is unique, and their healthcare should reflect that individuality. Generative AI has the potential to play an important role in creating personalized treatment plans tailored to each patient’s specific needs.

By analyzing a multitude of data points, including genetic profiles, medical histories, and lifestyle factors, Artificial intelligence can recommend treatment strategies that are not only effective but also minimally invasive. This level of personalization marks a significant shift from one-size-fits-all approaches, ultimately improving patient outcomes and enhancing their quality of life.

The healthcare industry can sometimes be slow to adopt new technologies, but the impact of generative AI is one that should not be overlooked. It has the potential to reshape the way healthcare professionals approach disease diagnosis, drug development, and patient care. It’s a testament to the remarkable potential of this technology to enhance and even save lives.

Next, we’ll explore how Generative AI is making waves in the financial services sector, where precision and speed are also of utmost importance.

Financial Services: Enhancing Client Experiences and Driving Financial Growth with Gen-AI

Financial Services and AI: Revolutionizing Finance with Gen-AI

The financial services industry has long been at the forefront of adopting cutting-edge technologies, and Generative AI is no exception. The marriage of financial services and artificial intelligence is reshaping the sector, ushering in an era of unparalleled innovation.

It is also democratizing the field that is typically limited to large hedge funds, algorithmic trading companies, and quant funds that have access to large data models. With the latest introduction to publically available large language models, the playing field is being leveled.

Risk Assessment and Fraud Detection:

In the high-stakes world of finance, risk assessment and fraud detection are paramount. Generative AI, with its ability to analyze vast datasets in real-time, plays a crucial role in safeguarding financial transactions.

AI algorithms can detect unusual patterns and anomalies that may indicate fraudulent activities, providing financial institutions with early warnings to prevent potential breaches. Additionally, Generative AI enhances risk assessment by evaluating complex variables and market trends, enabling more informed decision-making in lending and investment processes.

Algorithmic Trading:

Algorithmic trading, which relies on rapid data analysis and decision-making, is a natural fit for Generative AI. AI-driven algorithms can analyze market conditions, news events, and historical data with lightning speed, executing trades with precision and efficiency.

This not only reduces human errors but also optimizes trading strategies to capitalize on market opportunities. The result is a more efficient and responsive financial market that benefits both institutions and investors.

Customer Service and Chatbots:

Customer service is a critical component of the financial industry, and Generative AI is enhancing customer experiences through AI-powered chatbots. These chatbots provide instant, round-the-clock assistance to customers, answering queries, and handling routine tasks such as account inquiries and transaction processing.

Chatbots leverage natural language processing (NLP) to understand and respond to customer inquiries effectively. This not only improves customer satisfaction but also frees up human agents to focus on more complex tasks, such as personalized financial planning.

The financial services sector’s integration of Generative AI technology is revolutionizing how financial transactions are conducted, risks are assessed, and customer interactions are managed. It’s a testament to the technology’s capacity to streamline operations, enhance security, and provide a more customer-centric approach.

Next, we’ll explore how Generative AI is shaping the world of marketing and advertising, where creativity and precision are paramount.

Marketing and Advertising: Redefining Creativity with Gen-AI

Marketing and AI:

Marketing was one of the first industries to quickly adopt and feel the impact of generative AI, acting as a great use case for other industries. It is turning tasks that typically could take hours even weeks into minutes without sacrificing the creativity required in marketing.

This was the one hurdle critics never thought artificial intelligence would cross. But it has with flying colors. In this section, we’ll explore how Generative AI technology is revolutionizing marketing and advertising, from content creation to targeted advertising and gaining insights into consumer behavior.

Content Generation:

Generating captivating and relevant content is a cornerstone of successful marketing. Generative AI is making this easy with tools like ChatGPT and Midjourney to name a few. By analyzing vast datasets of text, images, and video, AI can generate compelling content, including articles, product descriptions, and even advertisements.

This not only saves time but also ensures consistency and relevance in content creation, enabling marketers to engage their audience more effectively.

Targeted Advertising:

Effective advertising hinges on reaching the right audience with the right message at the right time. Generative AI optimizes this process by leveraging data analytics and machine learning algorithms.

For example, Meta which has a $114 billion a year ad platform just announced generative AI features for advertisers. These features allow for quick generation of subtitle copy and design tweaks between ads allowing quicker and more efficient A/B testing. This is just the beginning as the war for eyeballs will commence between the major digital advertising players.

A triptych of digital advertisement examples. The left panel showcases an ad with the caption "Image expansion" featuring food from "Jasper's Market." The middle panel, labeled "Background generation," displays an ad for a bag with various background images. The right panel, titled "Text variations," presents an advertisement with different textual descriptions.
A compilation of digital advertising techniques: expanding images for food items, generating diverse backgrounds for product displays, and experimenting with text variations for ad content.

Customer Insights:

Understanding consumer behavior is crucial for crafting winning marketing strategies. Generative AI excels in this area by analyzing vast datasets of consumer interactions, social media activity, and purchasing habits. AI algorithms can identify patterns and trends, allowing marketers to gain valuable insights into what drives consumer choices.

This data-driven approach empowers marketers to fine-tune their strategies, optimize campaigns, and create more engaging content that resonates with their target audience.

Generative AI’s integration into marketing and advertising is redefining how brands connect with consumers. It’s not just about automation; it’s about elevating creativity and personalization to unprecedented levels.

However, with this innovation comes increased noise as the barrier of entry to create content drops to new lows. The ability to stand out and differentiate will likely get harder. Not easier.

Next, we’ll dive into the manufacturing and industry 4.0 sector, where Generative AI is optimizing operations and driving efficiency.

Manufacturing and Industry 4.0: Transforming Operations with Gen-AI

Manufacturing and AI:

Manufacturing has entered a new era with the advent of Industry 4.0, and at its core is the integration of artificial intelligence (AI). Generative AI, in particular, is revolutionizing modern manufacturing by enhancing efficiency, productivity, and innovation. In this section, we’ll delve into how Generative AI technology is reshaping manufacturing and Industry 4.0, from predictive maintenance to product design and supply chain optimization.

Predictive Maintenance:

Deloitte estimates on average, predictive maintenance increases productivity by 25%, reduces breakdown by 70%, and lowers maintenance costs by 25%. Generative AI has the potential to impact these stats to an even greater degree. Traditionally, machinery maintenance was scheduled at regular intervals, often leading to unnecessary downtime and costs.
A series of yellow robotic arms in a well-lit warehouse aisle, with shelves stacked with boxed goods on either side.
Advanced robotic arms streamline operations in a modern warehouse, surrounded by rows of neatly organized packages.

Generative AI changes this by continuously monitoring equipment through sensors and analyzing data in real-time. It can predict when a machine is likely to fail and trigger maintenance just in time, minimizing disruptions and reducing maintenance expenses.

This proactive approach ensures that production lines run smoothly, optimizing overall efficiency.

Product Design and Prototyping:

Generative AI plays a pivotal role in product design and prototyping. By analyzing design parameters and constraints, AI can generate and refine design concepts rapidly.

This accelerates the design process and also encourages innovation by exploring design possibilities that are overlooked by human designers. Additionally, Generative AI aids in the creation of prototypes by generating 3D models and simulations, facilitating rapid iteration and minimizing costly physical prototypes.

Supply Chain Optimization:

Efficient supply chain management is critical in modern manufacturing. AI algorithms can analyze vast amounts of data from suppliers, logistics, and demand forecasts to optimize the entire supply chain. This includes managing inventory levels, minimizing transportation costs, and ensuring timely deliveries.

Supply chain optimization not only reduces operational costs but also enhances responsiveness to market changes, ultimately improving customer satisfaction.

Generative AI’s integration into manufacturing and Industry 4.0 is driving a paradigm shift in how products are designed, produced, and delivered. It’s not just about streamlining processes; it’s about fostering innovation and adaptability, ensuring that manufacturing remains at the forefront of technological advancement.

Next, we’ll explore how Generative AI is reshaping the retail and e-commerce sector, where personalized experiences are key to success.

Education and E-Learning: Personalized Learning Powered by Generative AI

Education and AI:

Generative AI has the potential to change how we learn and educate across the globe. The fusion of education and AI is reshaping learning experiences, making them more personalized, adaptive, and effective. While some are quick to ban tools like ChatGPT, there is an opportunity to enhance the learning experience for both teachers and students.

In this section, we’ll delve into how Generative AI is revolutionizing education and e-learning, from tailoring learning experiences to automating grading and facilitating language learning.

Personalized Learning:

One of the most profound impacts of Generative AI in education is personalized learning. Traditional classrooms often employ a one-size-fits-all approach, which may not cater to the unique needs and pace of individual learners. Generative AI changes this by analyzing student performance data and learning styles to create customized learning paths.

This ensures that each student receives content and assignments tailored to their strengths and weaknesses, optimizing their learning experience and outcomes.

Automated Grading:

Grading and assessment are essential components of education, but they can be time-consuming for educators. Generative AI automates this process, relieving teachers of the burden of manual grading. AI algorithms can evaluate assignments, quizzes, and exams quickly and consistently, providing instant feedback to students. This not only streamlines the grading process but also allows educators to focus on more meaningful aspects of teaching, such as providing mentorship and support.

Language Learning Tools:

Language learning is another area where Generative AI shines. AI-powered language learning apps leverage natural language processing (NLP) to understand and respond to learners’ speech and writing.

These apps provide personalized lessons, practice exercises, and even conversation partners, enhancing language acquisition. Duolingo, a leader in this space, is using Gen-AI to make language learning more engaging and interactive. Their new feature Roleplay allows users to practice real-world conversation skills with world characters in the app. The best part is they never get tired of talking to you.

A mobile app screenshot showing a conversation interface. A user and a cartoon avatar of a barista are conversing in French. The barista asks, "What drink?" to which the user responds with "Café au lait." The barista then asks for the user's name for the order, and the user replies, "Je m'appelle Megan." The barista confirms with a message saying they'll have the order ready soon.
Mobile chat interface where a user named Megan orders a "Café au lait" from a virtual barista.

Generative AI makes language learning more engaging and accessible, breaking down language barriers for global learners.

The integration of Generative AI into education and e-learning represents a fundamental shift in how knowledge is imparted and acquired. It’s not just about automating tasks; it’s about enhancing the quality and effectiveness of education, ensuring that learners have the tools and support they need to succeed.

Next, we’ll explore how Generative AI is reshaping the world of entertainment and content creation, where creativity knows no bounds.

Entertainment and Content Creation: A Creative Revolution with Generative AI

Entertainment and AI:

The entertainment industry has always been at the forefront of innovation, and the adoption of generative AI is no different. AI is reshaping how we create, consume, and enjoy content.

In this section, we’ll explore how Generative AI is revolutionizing entertainment and content creation, from generating music, art, and literature to enhancing film and video production and even influencing the world of gaming.

Content Generation:

Generative AI has unlocked the door to limitless creativity. It can generate music, artwork, and even literature with simply a prompt. Music composition algorithms can analyze existing melodies and styles to create original compositions. AI artists can generate paintings, sculptures, and digital art that captivate audiences. Readers can explore neverending AI-generated stories and poems.

This not only pushes the boundaries of human creativity but also democratizes art, making it accessible to a broader audience.

Film and Video Production:

Gen-AI’s impact in film and video will no-doubt be huge. It is even creating a battle between Hollywood writers and AI as Hollywood screenwriters held-out through a 148 day strike.

None the less, AI will have a big impact in the future. AI-powered video editing tools can analyze footage, automatically cut scenes, and even suggest the most emotionally engaging sequences. AI-powered video editing tools can analyze footage, automatically cut scenes, and even suggest the most emotionally engaging sequences.

Special effects, once reserved for big-budget productions, are now within reach through AI-generated visuals. From enhancing visual effects to automating mundane editing tasks, AI elevates the quality and efficiency of film and video production.

A German tech entrepreneur is using AI-powered programs like Midjourney to create the footage, sound effects, and voices for a 70s-inspired sci-fi film.

Gaming:

Generative AI is making a significant impact on the gaming industry, influencing both game development and gameplay. AI-driven algorithms can generate game environments, characters, and even storylines.

This not only accelerates game development but also fosters innovation by creating unique gaming experiences. In gameplay, AI opponents can adapt and learn from players’ actions, providing dynamic and challenging experiences. AI also enhances player experiences through features like real-time translation and voice recognition.

The integration of Generative AI into entertainment and content creation is pushing the boundaries of what’s possible. It’s not just about automating tasks; it’s about unlocking new levels of creativity and interactivity, ensuring that entertainment remains a source of wonder and inspiration for audiences worldwide.

Next, we’ll explore how Generative AI is contributing to sustainability and environmental monitoring in the energy sector.

Energy and Sustainability: Transforming the Future with Generative AI

Energy and AI:

The energy sector, a cornerstone of modern life, has the potential to be completely transformed with Generative AI. The combination of energy and AI is redefining how we produce, distribute, and monitor energy, making it more efficient and sustainable.

In this section, we’ll explore how Generative AI is revolutionizing the energy sector, from optimizing energy distribution to advancing renewable energy solutions and monitoring environmental conditions.

Grid Management:

Efficient grid management is critical for ensuring a stable and reliable energy supply. Generative AI plays a pivotal role in this aspect by analyzing vast amounts of data from sensors, weather forecasts, and energy demand patterns. AI algorithms can optimize energy distribution, predict peak demand periods, and even reroute energy flows to prevent outages.

Gridmatic, a company focused on bringing AI to the climate change fight says, “AI is not just useful, but necessary. We use multiple forms of AI, but fundamentally we have built a model of the US electricity grid down to the nodal level. This foundation enables AI-powered forecasting.”

This not only enhances grid reliability but also reduces energy waste and costs, ultimately benefiting both utilities and consumers.

Renewable Energy:

The transition to renewable energy sources is a global imperative, and Generative AI is accelerating this shift. AI algorithms can analyze weather data, solar and wind patterns, and energy consumption trends to optimize the integration of renewable energy sources into the grid.

This ensures that renewable energy is harnessed efficiently and reduces the reliance on fossil fuels, contributing to a more sustainable and eco-friendly energy landscape.

Environmental Monitoring:

Environmental monitoring is crucial for assessing the impact of energy production on the environment. Generative AI aids in this endeavor by analyzing data from remote sensors, satellites, and ground-based measurements. AI can detect changes in air quality, monitor emissions, and assess ecological impacts.

This data-driven approach not only enhances environmental stewardship but also enables timely interventions to mitigate environmental damage.
The integration of Generative AI into the energy sector is shaping a more sustainable and efficient future. It’s not just about optimizing energy; it’s about preserving our planet for future generations, ensuring that energy production aligns with environmental responsibility.

In the next section, we’ll explore how Generative AI is revolutionizing the agricultural industry, where precision and sustainability are paramount.

Agriculture: Cultivating a Sustainable Future with Generative AI

Agriculture and AI:

The agricultural industry, essential for feeding the world’s population, can benefit heavily from advancements in generative AI. The combination of agriculture and AI is revolutionizing farming practices, making them more precise, productive, and sustainable.

In this section, we’ll explore how Generative AI is reshaping agriculture, from precision farming to early disease detection and accurate yield predictions.

Precision Agriculture:

Precision is paramount in agriculture, and Generative AI enhances it significantly. Precision agriculture leverages AI-powered tools to analyze data from sensors, satellites, and drones to create detailed maps of fields.

These maps provide insights into soil health, moisture levels, and crop growth, allowing farmers to optimize irrigation, fertilizer application, and planting patterns. The result is higher crop yields, reduced resource consumption, and improved sustainability.

A drone flying over a field with tall golden crops in the foreground and lush greenery in the background, under a partly cloudy sky.
A drone surveys an expansive crop field on a bright day, capturing the contrast between golden crops and the blue sky dotted with clouds.

Crop Disease Detection:

Early detection of crop diseases is crucial for minimizing crop loss. Generative AI plays a vital role in this area by analyzing images of crops and leaves to identify signs of diseases, nutrient deficiencies, and pest infestations.

By spotting these issues early, farmers can take proactive measures, such as targeted pesticide application or crop rotation, to safeguard their harvests and minimize environmental impact.

Harvest Prediction:

Accurate yield predictions are essential for efficient farm management and supply chain planning. Generative AI leverages historical data, weather forecasts, and satellite imagery to provide precise yield predictions.

These predictions help farmers make informed decisions about harvesting, storage, and transportation, ultimately reducing food waste and ensuring a stable food supply.

SpaceAG, an agtech startup is doing just this with their algorithm that is trained on 11 varieties of blueberries which recognizes the different phenological stages (flower, green, purple, blue). This recognition and counting give farmers a better prediction of their crop yield allowing for improved quality and quantity.

Integrating Generative AI into agriculture is not just about improving farm operations; it’s about cultivating a sustainable future. It empowers farmers to produce more with fewer resources, minimize environmental impact, and contribute to global food security.

In the final section, we’ll recap the diverse industries where Generative AI is making a significant impact and highlight its potential to shape a more innovative and sustainable world.

Future Potential: Navigating the Expanding Horizons of Generative AI

The Expanding Role of Generative AI:

As we’ve explored, Generative AI is already making waves across various industries, transforming how we work, create, and live. Its role is poised to expand even further as AI technologies continue to evolve.

In the future, we can expect Generative AI to play a more significant role in fields such as healthcare, finance, education, entertainment, energy, and agriculture. The boundaries of what is possible with AI-driven creativity, precision, and efficiency are continually expanding, opening new doors for innovation and progress.

Ethical Considerations:

With great power comes great responsibility, and Generative AI is no exception. As its influence grows, ethical considerations become paramount. Questions about data privacy, bias in AI algorithms, and the potential for misuse need to be addressed.

Responsible AI development and deployment, along with robust ethical frameworks, will be crucial to ensure that Generative AI benefits society without harming it.

On the HatchWorks Built Right podcast, Jason Schachter – founder of AI Empowerment Group, dug into how you should consider risk when vetting use cases.

Challenges and Future Trends:

While Generative AI holds immense promise, it also faces challenges. These challenges include addressing the “black box” problem in AI, where decisions made by algorithms are not easily explainable, as well as refining AI’s understanding of context and nuance.

In addition to challenges, several trends will shape the future of Generative AI. These include increased automation in various industries, the development of AI-powered creativity tools for artists and content creators, and the continued integration of AI into everyday life through voice assistants, smart devices, and autonomous systems.

Generative AI’s future is bright, but it must be navigated with care, considering ethical implications and addressing challenges. As we continue to harness the power of Generative AI, we are on a path toward a more innovative, efficient, and sustainable world, where human creativity and AI-driven precision coexist harmoniously.

See how HatchWorks is leading the way in AI-powered software development.

Our Generative-Driven Development™ leverages cutting-edge AI to optimize your software projects.

Discover the difference on our page.

Conclusion: Embracing the Transformative Power of Generative AI

Generative AI is not just a technology; it’s a catalyst for change. It optimizes operations, empowers creativity, and enhances decision-making across numerous sectors. As it continues to evolve, its influence is expanding, promising to reshape even more facets of our lives, from education to agriculture, and energy to sustainability.

The key takeaways are clear:

  • Gen-AI is a disruptive force, revolutionizing industries and redefining standards.
  • Personalization, efficiency, and sustainability are central themes across sectors.
  • Ethical considerations and responsible AI use must guide its development and deployment.
  • Challenges are opportunities for growth, and the future holds exciting trends.

We encourage you, to explore and leverage the power of Generative AI in your respective fields. Whether you’re a healthcare professional, financial analyst, marketer, educator, filmmaker, farmer, or anyone else. Embrace it with curiosity, creativity, and responsibility.

Hatchworks: Your US-Based Nearshore Software Development Partner

At HatchWorks, we understand the importance of leveraging generative AI responsibly and ethically.

As a software development partner, we utilize the power of generative AI to build innovative digital products that meet the unique needs and expectations of our clients tailored to your industry.

Reach out to us to learn more about how we can help you harness the potential of generative AI for your projects.

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]]> Top 9 Nearshore Software Development Companies [2024] https://hatchworks.com/blog/nearshore-development/top-nearshore-software-companies/ Wed, 18 Oct 2023 20:03:07 +0000 https://hatchworks.com/?p=30087 Today’s fast-paced digital landscape is moving at a breakneck speed. Businesses are constantly looking for efficient and cost-effective solutions for software development. Speed to value is paramount when it comes to delivering value for your customers in a sustainable way. One strategy that has gained significant traction is Nearshore software development. By partnering with geographically […]

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Today’s fast-paced digital landscape is moving at a breakneck speed. Businesses are constantly looking for efficient and cost-effective solutions for software development.

Speed to value is paramount when it comes to delivering value for your customers in a sustainable way. One strategy that has gained significant traction is Nearshore software development.

By partnering with geographically closer companies, businesses can benefit from working in the same time zone, reduced costs, and cultural similarities.

Graphic featuring a stylized globe with highlighted stars. In the foreground, a large yellow square contains text reading 'TOP 9 NEAR SHORE Software Development Companies'.

This blog is your ultimate guide to navigating the world of Nearshore software development. We will delve into the top 9 Nearshore software development companies in 2024, offering you a comprehensive look at your best options.

Whether you’re a startup looking for agile development or an established enterprise undertaking a digital transformation, we’ve got you covered.

Skip ahead:

Why Nearshore Outsourcing?

The amount of options in the realm of software development is enough to make your head spin. You can go Offshore, Onshore, or Nearshore.

Map of Onshore, Nearshore, and Offshore regions
Nearshore software outsourcing is when a company has distributed teams in countries that are in the same or similar time zone. For companies in the US, this means countries in Latin America.

Each has its merits, but Nearshore software development stands out for several compelling reasons. Let’s explore why Nearshore outsourcing could be the best choice for your business.

Nearshore Advantages Over Offshore and Onshore

First, Nearshore offers a middle ground between Offshore and Onshore options for custom software development. Offshore development may offer cost savings, but it often comes with challenges like time zone alignment differences and language barriers.

Onshore development, while convenient, can be prohibitively expensive. Nearshore development, on the other hand, provides the best of both worlds. Companies are close enough for easy communication and visits but far enough to offer competitive pricing.

Cost-Effective and Efficient Solution

Cost is a significant factor in any business decision, and software development is no exception.

Nearshore development can be incredibly cost-effective with an average cost that is 50% more affordable than Onshore. The proximity allows for reduced travel expenses and easier team integration, which can be crucial for agile development processes.

Additionally, the similar time zones facilitate real-time communication, making project management more straightforward and efficient.

In summary, Nearshore software development offers a balanced approach that combines the advantages of both Offshore and Onshore options. It is no surprise the Nearshore software development market is valued at $105B and growing at 8.7% CAGR. It provides a cost-effective, efficient solution that can be tailored to meet the unique needs of your business.

If you’re looking to maximize value without compromising quality, Nearshore software development should be on your radar.

Criteria for Selecting Nearshore Software Development Companies

Choosing the right Nearshore software development company is a critical decision that can significantly impact your project’s success. But how do you sift through the myriad of options to find the perfect fit?

Here are some key factors to consider, each with its own unique set of implications.

Expertise and Technical Skills

The first and foremost criterion is the company’s expertise in the technologies and frameworks relevant to your project. A company with a proven track record in your industry can offer invaluable insights and solutions. Look for case studies, client testimonials, and any industry awards that can vouch for their expertise.

Engagement Model

The engagement model refers to how the company plans to collaborate with you throughout the project. Whether it’s pure staff augmentation, a dedicated team, or a project-based model, understanding their engagement model can help gauge how well they’ll fit with your project needs.

US Presence

A company with a presence in the US can offer several advantages, including easier legal recourse and the possibility of in-person meetings. This can be particularly beneficial for US-based companies looking for Nearshore outsourcing options.

Reviews and References

Don’t underestimate the power of word-of-mouth. Online reviews and client references can provide an unfiltered view of what it’s like to work with the company.

By carefully considering these criteria, you can make a more informed decision and choose a Nearshore software development company that aligns with your project’s needs and goals.

Top 9 Nearshore Software Development Companies in 2024

Company #1: HatchWorks

Footprint: Atlanta, GA, Chicago, IL, Dallas, TX, Costa Rica, Colombia, Peru, Brazil, Mexico
Headquarters: Atlanta, GA
Key Clients: PWC, Carter’s, AT&T, Diebold Nixdorf

HatchWorks logo.

Overview:
HatchWorks is a US-based Nearshore software development partner that offers local, high-touch service with the affordability and scale of Nearshore outsourcing. They provide an alternative to software boutiques that can’t scale, the lackluster results of Offshore outsourcing body shops, and expensive digital transformation giants.

Main Differentiator:
Unlike other Nearshore outsourcing providers, HatchWorks has a US-based solutions practice and client success team setting your project up for success and managing it through delivery. They organically built their Nearshore footprint from the ground up resulting in a 98.5% retention rate, ensuring no project disruptions for their clients.

They also provide a proven methodology, their Built Right Method, increasing speed-to-value throughout the software development lifecycle so their clients achieve their desired outcomes faster. It incorporates AI-enhanced development, specialized frameworks, and automation accelerators. Plus the client’s team is upskilled in the process.

Expertise and Technical Skills:
HatchWorks specializes in custom software development, AI, data analytics, product strategy, and product design. They have expertise in 100+ technologies, including React, AngularJS, Python, AWS, and more. Their approach leverages the latest technologies to increase speed-to-value and quality for their clients.

Engagement Model:
HatchWorks offers 3 engagement models tailored to the needs of their clients.

  • Staff Augmentation: Developers integrated into your team
  • Dedicated Agile Teams: Software teams integrated into your organization
  • Outcome-Based Project: Full-service software solution development aligned to your success criteria

HatchWorks’ ability to do outcome-based projects is what stands out considering most Nearshore software development companies will only provide staff augmentation or dedicated teams that the client has to manage.

They also provided dedicated US-based client success managers to ensure the client’s project stays on track.

US Presence:
HatchWorks was founded and is headquartered in Atlanta, GA giving it a true US presence. They have expanded that presence to include Chicago, IL, and Dallas, TX. Their organic growth into Latin America and structure developed including in-country management is what has maintained the culture resulting in a 98.5% employee retention rate.

Customer Quote:
“HatchWorks Nearshore delivery model has transformed the way we work. Their engineering teams seamlessly integrated with ours making collaboration easy. We have trusted them for over 5 years and now have a team of 50+ Nearshore engineers helping accelerate our digital transformation.”

Company #2: Octobot

Footprint: Uruguay, Argentina
Headquarters: Montevideo, Uruguay
Key Clients: Wheel, MSG, Rover, Turntide

Octobot logo.

Overview:
Octobot is a Latin American-based custom software development company that focuses on transforming people’s digital experiences. They offer a range of services from design to development and cloud services.

Main Differentiator:
Their deep presence in Uruguay. They are committed to solving today’s digital challenges by turning problems into products people love.

Expertise and Technical Skills:
Octobot specializes in user-oriented design and top-level development. They offer services in UX/UI design, mobile and web app development, and cloud services. Their expertise spans multiple industries, including marketing, healthcare, retail, and more, showcasing their adaptability and broad skill set.

Engagement Model:
Octobot provides a complete set of skills from kickoff to launch, implying a comprehensive engagement model. They offer services that help you envision your solution, prioritize it, build a prototype, and test it until you’re ready to launch.

US Presence:
They do not have a US presence with their headquarters located in Uruguay.

Customer Quote:
“The engineers we hired were engaged, independent, and skilled.”

Company #3: Softek

Footprint: Dallas, TX, Canada, Mexico, Colombia, Peru, Argentina, Brazil, Costa Rica, France, London, India, and China
Headquarters: Monterrey, Mexico
Key Clients: Only white-labeled case studies provided

Softek logo.

Overview:
Softek is a global technology consulting firm with a focus on transforming businesses through digital solutions. They offer a wide range of services, from custom software development to cloud services and digital security.

Main Differentiator:
Their unique approach to service transformation and portfolio transformation sets them apart in the industry. They also have a global presence outside of just US and LatAm.

Expertise and Technical Skills:
Softek’s expertise is vast, covering areas like software engineering, quality engineering, and application management. They also offer specialized services in cloud and DevOps, data and AI, mobile app development and intelligent automation. Their broad skill set makes them a one-stop-shop for all your technology needs.

Engagement Model:
Softek’s engagement model is comprehensive, covering everything from digital optimization to IT cost optimization. They offer solutions that are tailored to the specific needs of various industries, ensuring that your project is not just another cookie-cutter solution.

US Presence:
Softtek does not have a US-based delivery center. Their headquarters is located in Monterrey, Mexico.

Customer Quotes:
“Softtek is a qualified global supplier that can meet all the requirements of our company.”

Company#4: Revelo

Footprint: Miami, Fl, Brazil, Argentina, Ecuador, Colombia, Mexico, London, India, and China
Headquarters: Miami, Fl
Key Clients: Tech Insights, Easy Health, Sardine, Shippo

Overview:
Revelo is a talent platform specializing in helping businesses find, hire, and manage top-tier remote Nearshore software developers in Latin America similar to Fiverr. Revelo is a good option if you are looking to add contract developers to your team that you will manage.

Main Differentiator:
Their unique value proposition is providing a pool of pre-vetted candidates for both technical and soft skills via their talent portal with the ability to provide a short list within 3 days and hiring as soon as 2 weeks.

Expertise and Technical Skills:
Revelo boasts a talent pool of senior software developers pre-screened across 100+ skills. They cover a wide range of tech stacks, including but not limited to React Native, Android, C++, iOS, Rust, Vue.js, PHP, Swift, Java, Angular, Node.js, Ruby on Rails, C#, Scala, Ruby, and Python.

Engagement Model:
Revelo’s main engagement model is staff augmentation, helping you fill gaps on your team. You are tasked with managing the developers they source.

US Presence:
Revelo’s one location in the US is its headquarters in Miami, FL. This mainly consists of business development and some leadership roles.

Customer Quote:
“Most of the candidates they have brought to us are an excellent match for what we need.”

Company #5: BairesDev

Footprint: United States, Argentina, Mexico, Brazil, Colombia, Peru
Headquarters: San Francisco, California
Key Clients: RevUnit, Signal, Motorola, NextRoll

Overview:
BairesDev is a Nearshore outsourcing software development company that specializes in providing outsourced tech talent. They pride themselves on their fast and flexible approach, allowing them to quickly onboard teams to jump-start tech projects. They were originally founded in Buenos Aires, Argentina.

Main Differentiator:
Their main differentiator is their size at roughly 4,000 developers.

Expertise and Technical Skills:
BairesDev offers a wide array of technical skills, including expertise in almost every programming language such as Node.js, Java, React, .NET, Python, and more. They provide services in custom software development, QA and testing, mobile app development, and UX/UI design.

Engagement Model:
BairesDev mainly offers outsourced tech talent in a staff augmentation or dedicated team model. While they have access to a large talent portal, it is typically up to the client to manage the project.

US Presence:
BairesDev was originally founded in Buenos Aires, Argentina later moved its headquarters to San Francisco in 2012 with the majority of its sales and account management sitting in the US and engineers in Latin America.

Customer Quotes:
“Their project management has been responsive and the team has been on top of all the details.”

Company #6: Howdy

Footprint: Austin, TX, Uruguay, Argentina, Mexico, Colombia
Headquarters: Austin, TX
Key Clients: Kojo, Loud Crowd, Measured, Sprout

Howdy logo.

Overview:
Howdy is a Nearshore outsourcing software development company that specializes in providing top-tier Latin American developers to businesses. They offer immediate access to a vetted network of developers, setting them apart from competitors.

Main Differentiator:
Howdy’s main differentiator is their talent platform allowing you to build, manage, and pay for your team in the platform making it a good option for small companies and startups.

Expertise and Technical Skills:
Howdy offers a broad range of expertise, covering over 100+ technologies. They are proficient in web technologies like React and Angular, mobile technologies like React Native and Kotlin, and server-side technologies like Node.js, Java, Python, .NET, Ruby on Rails, and GoLang. They also offer skills in UI/UX and product Management, ML and Data Engineering, and DevOps.

Engagement Model:
Howdy’s main engagement model is staff augmentation through their streamlined hiring process, helping you fill gaps on your team. You are tasked with managing the developers they source.

US Presence:
Howdy has a physical location in Austin, TX, their headquarters with the majority of their team residing in Latin America.

Customer Quote:
“The way Howdy provides developers in the industry is truly exceptional”

Company #7: Novatech

Footprint: El Salvador, Dominican Republic, Argentina
Headquarters: San Salvador, El Salvador
Key Clients: Smart Fleet, Travel Good, Future Fab

Novatech logo.

Overview:
Novatech is a Nearshore software development company that positions itself as a strategic, technological partner for businesses. They focus on delivering innovative, creative, and out-of-the-box software web development solutions, helping companies stand out from the competition.

Main Differentiator:
Their main differentiator relates to their Nearshore services and focus in El Salvador which is a less common destination for Nearshore software development services.

Expertise and Technical Skills:
Novatech offers a large talent pool of developers skilled in various technologies. They provide highly skilled and cost-effective resources.

Engagement Model:
Novatech offers three primary engagement models:
Nova: Engages in co-creative processes to deliver end-to-end products with the client’s business input.
Boost: Increases the client’s development capabilities by integrating meticulously chosen resources as part of their team.
Squad: Outsourcing of a custom Scrum team guided by the client’s Product Owner or Novatech’s Product Owner.

US Presence:
Novatech footprint is in Latin America with their main concentration being in El Salvador.

Customer Quote:
No public customer quote is available.

Company #8: Gorilla Logic

Footprint: Broomfield, CO, Mexico, Colombia, Costa Rica
Headquarters: Broomfield, CO
Key Clients: Gaia, Finish Line, Maxar

Overview:
Gorilla Logic has been in business for 20 years. They emphasize hiring Latin America’s best English-fluent developers, ensuring clients get the exact skills and collaboration they need.

Main Differentiator:
Their main differentiator is that they have been in business for 20 years, and their use of Agile in software development.

Expertise and Technical Skills:
The company specializes in various technologies including Python, React/Redux, and Amazon Web Services (AWS). They offer services from wireframing and prototyping to web and mobile app development.

Engagement Model:
Gorilla Logic’s engagement models consist of staff augmentation and distributed Agile development teams. They focus on a collaborative partnership to create faster and easier solutions for customers.

US Presence:
Gorilla Logic was founded in the US with its headquarters in Broomfield, Colorado. They made the shift to Nearshore software outsourcing early in their history.

Customer Quote:
“The fluidity and ease of communication with Gorilla logic were incredible”

Company #9: Improving

Footprint: United States and Mexico
Headquarters: Austin, TX
Key Clients: Western Digital, Iridium, Integral Ad Science

Improving logo.

Overview:
Formerly known as iTexico, Improving is a Nearshore IT outsourcing firm offering training, consulting, recruiting, and project development services. It prides itself on its commitment to establishing trust, not transactions. They focus on delivering advanced solutions through a culture of involvement and stewardship.

Main Differentiator:
They provide hands-on training opportunities to help upskill their clients.

Expertise and Technical Skills:
Improving offers a wide range of services, including Agile training, enterprise software solutions, and data services. Their expertise spans multiple industries, such as finance, healthcare, and retail, making them a versatile choice for various business needs.

strong>Engagement Model:
Improving’s engagement models include outsourcing, consulting, and training.

US Presence:
Improving has multiple locations across the United States. Its Nearshore outsourcing presence is a smaller portion of its total headcount overall.

Customer Quote:
No public customer quote is available.

Optimizing Nearshore Software Development: Best Practices

Importance of Maintaining Clear Communication and Receiving Regular Updates:

One of the main value props of Nearshore software outsourcing is sharing the same time zone. However, that doesn’t guarantee effective communication. This goes beyond regular check-ins; it involves setting up structured communication channels, such as daily stand-ups, weekly sprints, and monthly reviews.

These practices ensure that everyone is on the same page and that any issues are addressed promptly. Regular updates also allow for real-time adjustments, ensuring that the project stays on track and within budget.

Look for a company that has strong Agile practices throughout its organization to ensure you have a consistent feedback loop in place.

Significance of Adopting the Latest Technology including AI:

The pace of change in software development is enough to make your head spin. Staying ahead of the curve is not just an advantage—it’s a necessity.

One of the most transformative technologies in recent years is Artificial Intelligence (AI). AI is revolutionizing how software is developed, tested, and deployed. It enables predictive analytics, automates routine tasks, and even contributes to coding through AI-powered development tools.

Having a Nearshore partner that is adaptable to technological changes, such as the integration of AI, is crucial for the success of your project. This adaptability allows teams to leverage the latest advancements to solve complex problems more efficiently and deliver more value to your business. It also positions the project to be more scalable and future-proof, ensuring a longer lifecycle and better ROI.

Be wary of Nearshore providers that focus the conversation only on bodies and an hourly rate. They have no incentive to leverage the latest advancements in technology including AI.

Conclusion

Nearshore software development services have emerged as a compelling strategy for businesses seeking efficiency, cost-effectiveness, and quality all in the same time zone. This blog has guided you through the top 9 Nearshore software development companies of 2024, each with its unique strengths and offerings. From the balanced approach of Nearshore software development services to the critical criteria for selecting a Nearshore partner, we’ve covered the essentials.

If you’re a startup aiming for agility or an enterprise looking to scale, Nearshore outsourcing offers a tailored solution to meet your unique needs. Don’t miss out on the opportunity to maximize value without compromising quality. Explore your Nearshore options today and set your software and app development projects on the path to success.

Hatchworks: Your US-Based Nearshore Software Development Partner

HatchWorks is a US-based Nearshore software development partner that combines local, high-touch service with the affordability and scale of Nearshore outsourcing, all in your time zone.

Our teams are fluent in English and have a 98.5% retention rate—meaning your project won’t be interrupted or delayed.

After a 5-step screening process, we fit you with the right talent for the job and build your digital products one of three ways: through Staff Augmentation, Dedicated Agile Teams, or Outcome-Based Projects (a full service software development solution).

Start your project in as little as two weeks and cut your software development costs in half.

The post Top 9 Nearshore Software Development Companies [2024] appeared first on HatchWorks.

]]> The 6 Principles of Minimum Viable Replacement (MVR) https://hatchworks.com/blog/software-development/the-6-principles-of-minimum-viable-replacement-mvr/ Fri, 17 Mar 2023 17:25:50 +0000 https://hatchworks.com/?p=29412 Is your business struggling with outdated legacy systems that just don’t seem to keep up with the times? As much as you’d like to rip out those old systems and start fresh, it can be a costly and risky proposition. Especially when a solution has existing users and is driving revenue for your business. That’s […]

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Is your business struggling with outdated legacy systems that just don’t seem to keep up with the times? As much as you’d like to rip out those old systems and start fresh, it can be a costly and risky proposition. Especially when a solution has existing users and is driving revenue for your business.

That’s where Minimum Viable Replacement (MVR) comes in. A Minimal Viable Replacement (MVR) is an approach, popularized by Kevin Mireles, to replace a legacy solution that has an existing base of users or customers. It’s a modernization strategy that involves upgrading legacy systems incrementally, replacing only the most essential components with newer, more efficient technology.

6 Principles of MVR.

Now, you might be thinking, “Isn’t that just putting a band-aid on the problem?” But hear us out. By upgrading your legacy systems in small, manageable increments, you can avoid the risks and high costs of a complete system overhaul, while still keeping your business up-to-date with modern technology, and more importantly running without interruption.

The MVR approach is guided by 6 key principles, each of which plays an important role in the successful modernization of legacy solutions. In this blog, we’re going to dive deep into those 6 principles and show you how to put them into action. By the end, you’ll have a better understanding of how MVR can work for your business and how to start your journey toward more efficient and modern solutions. Let’s get started!

Skip ahead to the 6 principles:

Principle 1: Compete against your existing product

MVPs are focused on incumbent competitors that own the market. There is also competition from existing behaviors and status quo, which can sometimes be an MVP’s biggest competition.

However, when you are modernizing or digitally transforming an existing solution, your biggest competition is your existing solution. This is where human nature comes into play. Users are already familiar with using your existing solution and will prefer it even when it doesn’t make logical sense.

The two core psychological phenomena at play in an MVR are:

Endowment effect: People are more likely to retain an object they own rather than acquire a similar object (either in value or appearance). In essence, people feel a sense of ownership over the systems and technology they currently use and are not typically gung-ho about giving it up.

Loss aversion: People value losses more than they value potential gains. Not just by a little either. They tend to value it by 2 to 4 times more. Anything less than that is likely to be perceived as incredibly negative. In essence, a bird in the hand is worth two in the bush.

We are ultimately creatures of habit, which makes an MVR unique.

Principle 2: Prioritize your most valuable users

In any existing solution, you have many user segments, and they are not all equal. Typically there will be smaller user groups that either make up a majority of the product usage or a majority of the product’s revenue.

In either case, you must prioritize understanding your most valuable users’ needs, pain points, and desires first.

Principle 3: Identify your most critical workflows

While user segments are important, the workflows they leverage are even more critical. Prioritize the highest value workflows first and understand what parts of the system they touch.

This detail will directly impact the approach you take with your MVR, and will help define the incremental value you provide.

Principle 4: Focus on improving function, experience, and technology

MVPs focus on validating a market and an idea. With an existing solution, your product has already been validated. The focus should instead be on improving your existing solution to better serve your target users.

While technology is typically front and center with any modernization project, you can not miss the opportunity to improve and sometimes completely reimagine both the function and experience of your solution. The design of your solution is critical to adoption and ongoing use, and can not be overlooked.

Principle 5: Prioritize incremental enhancements over big bang

This is the one principle that is similar to an MVP approach. However, it is more nuanced and critical that the increments are clearly defined, and will not disrupt the existing users’ use of the current solution.

There are three standard approaches: Functional, Process, and Add-On that are detailed in our MVR overview: Minimum Viable Replacement: A New Approach to Modernizing Legacy Solutions.

Identifying the one that works best for your modernization project is critical to its success.

Principle 6: Understand how customers use your product

Your product will be used in ways you never intended. This must be understood and considered when improving the function and flow of your solution. Otherwise, you may be missing critical workflows that are not formally documented.

In order to understand this, it is imperative that you perform proper discovery and actually talk to actual users of the solution to understand from a qualitative standpoint how they use your solution.

You should also leverage any tools that provide quantitative data about how the system is used. This can include tools like Hotjar as well as system usage data.

Summary

In conclusion, Minimum Viable Replacement is a smart way to modernize your product without the high cost and risk of a complete overhaul. By following these 6 principles, you can ensure the success of your MVR strategy and keep your product up-to-date with the latest technology.

Remember to prioritize the most valuable users, identify the most critical workflow, focus on improving function, experience, and technology, prioritize incremental enhancements over big bang, and understand how customers use your product. With these principles in mind, you can modernize your product gradually and keep up with the competition.

Getting Started with HatchWorks Is Easy

Want to learn more about how we deliver solutions that are valuable, usable, feasible, and viable through our integrated US and Nearshore delivery model?

No matter what phase you are at in your software solution journey, HatchWorks can help you create a user experience your customers will love.

The post The 6 Principles of Minimum Viable Replacement (MVR) appeared first on HatchWorks.

]]> What is the Built Right Mindset? https://hatchworks.com/blog/software-development/built-right-mindset/ Fri, 17 Mar 2023 17:15:21 +0000 https://hatchworks.com/?p=29411 If you are a product, technology, or business leader, and you are building a digital product or undergoing a digital transformation (which, let’s be honest, can be scary), you probably have two questions keeping you up at night: Am I building the right thing? Am I building it the right way? This is the difference […]

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If you are a product, technology, or business leader, and you are building a digital product or undergoing a digital transformation (which, let’s be honest, can be scary), you probably have two questions keeping you up at night:

  • Am I building the right thing?
  • Am I building it the right way?

This is the difference between creating a digital product that stands out and disrupts the market, versus those that fizzle out wasting time, resources, and cash. Whether you are undertaking a digital transformation at a Fortune 500 company or building a brand new solution as a startup, nobody’s got time for that!

What is the Built Right Mindset?

At HatchWorks, our sole focus is to build the right digital product the right way.

We call it the Built Right mindset.

But what does that mean?

Let’s start with the first component: “Am I building the right product?”

In this blog, you will learn:

Am I building the right product?

The right product must satisfy three critical components. It must be valuable, viable, and feasible.

Valuable

Your solution must be valuable in the eyes of your end user, which ultimately impacts whether someone will buy or use your product. In order to achieve this you must focus on solving the right problem for the right user. You must have clarity on who your solution is for, and more importantly, what problem it solves for them. To do this, you must first understand your user’s job to be done. In other words, what progress are they looking to achieve?

Everything you add to your roadmap and build should be viewed through this lens.

Viable

It is not enough for users to love your solution. It must also work for your business and be economically viable for you to continue building and supporting your solution in a sustainable way.

This can come in the form of:

  • Your overall business model,
  • Your go to market strategy,
  • How you acquire customers, or
  • The total costs to build and run your business.

The one thing that can change the viability of your business are market forces. Take the pandemic for instance. It completely ruined the viability of some businesses overnight, while creating new opportunities for others.

P.S. If you are looking for a cost-effective way to build your custom software solution in your timezone, check out our comparison of onshore, offshore, and nearshore costs.

Feasible

Feasibility is all about whether or not the solution you have defined can actually be developed by your engineering team. This is based on their skill set, available technology, and the agreed upon timeline.

All three of these components must be satisfied to build the right digital product.

Am I building it the right way?

Building the right digital product is critical to get right, but it is all for naught if you don’t build it the right way.

A product that is built right must satisfy these four components: It must be maintainable, scalable, secure, and usable.

Maintainable

The majority of software cost is in ongoing maintenance, not its initial development. Having a maintainable solution is all about making life easier for your developers. A maintainable solution is one that can be repaired, improved, and understood with ease.

A highly maintainable solution possesses these 5 qualities:

  • Modular: the solution is composed of discrete components so that a change in one component has minimal impact on others in the system
  • Reuseable: The extent to which the solution makes use of assets that can be reused in building other assets in the system
  • Analyzable: the ease at which impacts of a change can be easily identified, diagnosed, and analyzed
  • Modifiable: The ease at which the solution can be modified without introducing new defects or degrading the existing solution quality
  • Testable: The ease at which the system can be tested ideally through automated testing

Scalable

This is all about how performant your solution is based on the changing demand for your solution. Prioritizing this from the start can lead to lower maintenance costs, a better user experience, and all-around higher agility.

This is more than just throwing your solution in the cloud – it has to be architected the right way to ensure optimal performance over time.

Secure

Security must be architected into your solution from the beginning, not an afterthought to be bolted on at the end. In today’s world, this is one area of your solution you can’t skimp on. It’s not just your sensitive data that’s at stake; your customers and users who depend on your solution are also in the balance.

Usable

Last but not least, your solution must be usable. Wouldn’t it be a shame to get this far, and not have a usable solution? This goes deeper than just the UI of your solution. It includes the user experience, which must be architected in a way that is enjoyable and friction-free for your end users. To do this, you must keep the user experience top of mind through initial ideation and discovery all the way through delivery.

Summary

To sum it up, building a digital product that hits the mark requires more than just throwing some code together and crossing your fingers. As a product, technology, or business leader, you need to constantly ask yourself two questions: Am I building the right thing, and am I building it the right way? This means making sure your product satisfies the critical components of being valuable, viable, and feasible, while also being built in a secure, scalable, maintainable, and usable way.

At HatchWorks, we call this the Built Right mindset, and it’s what we live and breathe every day to help our clients achieve success in their digital transformations. Whether you are building a brand new solution or modernizing an existing one, adopting this mindset is crucial to standing out in today’s fiercely competitive markets.

So, if you want to build a digital product that disrupts the market and sets you up for success, keep these principles in mind and focus on building the right product the right way. Trust us, your customers (and your bottom line) will thank you for it!

Getting Started with HatchWorks Is Easy

Want to learn more about how we deliver solutions that are valuable, usable, feasible, and viable through our integrated US and Nearshore delivery model?

No matter what phase you are at in your software solution journey,
HatchWorks can help you create a user experience your customers will love.

The post What is the Built Right Mindset? appeared first on HatchWorks.

]]> How to Select the Right Outsourced Development Team https://hatchworks.com/blog/nearshore-development/how-to-select-the-right-outsourced-development-team/ Fri, 10 Feb 2023 14:29:56 +0000 https://hatchworks.com/?p=28939 Outsourced Development Teams have proven to be a secret strategy for companies looking to accelerate software development and more importantly accelerate time to value. Time to value is defined as the time it takes for your customer to start deriving value from your digital solution. This is VERY important. The right outsourced development team can […]

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Outsourced Development Teams have proven to be a secret strategy for companies looking to accelerate software development and more importantly accelerate time to value.

Time to value is defined as the time it takes for your customer to start deriving value from your digital solution.

This is VERY important.

The right outsourced development team can act as a true partner helping make sure what you are building is desirable by your customers and viable for your business.

How to Select the Right Outsourced Development Team.
In this guide, we will cover:

What is an outsourced development team?

An outsourced development team is a team external to your own provided by a 3rd party partner focused on providing software development services. There are several models of outsourced development teams, but typically the outsourced development team is focused on delivering a specific software development solution.

Why outsourced development teams are more important now than ever before

With an impending recession, outsourcing software development can be a critical part of your strategy.

Software application development services still remain the most outsourced IT function with 60% of US businesses planning to outsource at least part of their development.

Even with a recession upon us, the global software application outsourcing market is projected at $116B in 2022 and is expected to reach $145.7B by 2027. That is a 4.7% growth rate.

So why are companies continuing to look to outsourced development teams even with a recession imminent?

They reduce costs and operating expenses

This one is obvious but worth noting. When working with an outsourced development team, you are not responsible for the typical expenses you would incur when hiring a full-time employee such as healthcare, insurance, taxes, training, etc.

Outsourced development teams offer flexible velocity

A major benefit of an outsourced development team is the ability to ramp up quickly and start delivering compared to the relative time it would take you to hire an internal team. Not to mention the time it takes for an Agile team to start gelling and working well together.

Outsourced development teams typically have worked on other projects together and bring experience and the attributes of a high-functioning team.

The other component of that is the flexibility to scale the teams up or down based on your project needs, economic situation, competitive landscape, business strategy, etc.

The alternative of “scaling down” an internal team is no fun and is an easy way to harm morale and culture.

They provide deep talent and expertise

Outsourced development teams allow you to tap into top talent, and depending on the partner you are working with, you can tap into a global talent pool.

Trying to build your own presence in another country is no small task. Outsourced development partners allow you to take advantage of these global talent pools without the headache of operating your business in other regions of the world.

While top talent is always important, domain-specific expertise is sometimes overlooked. This can include domain expertise related to your technology, industry, and approach to software development.

The best outsourced teams provide accountability

Last, but probably the most important factor is accountability. If you are working with the right partner, they will make accountability easy by leveraging Agile principles and providing consistent updates on the progress of your project.

The one constant in software development is change. A good partner will keep you in the loop as your needs, customer needs, scope, and the market evolve.

The types of outsourced development teams

Having a successful engagement with an outsourced development team is highly dependent on selecting the right model based on your company and the type of project you are looking to deliver.

There are 3 main models to consider when working with an outsourced development team.

Integrated teams

Integrated teams are best when you are looking to fill gaps within your existing development team. Your internal team works alongside your partner’s software developers to form a cohesive team.

You are typically required to provide direction for your partner’s engineers and own the project’s outcome. Contracts are often structured in a time and materials or fixed monthly cost per team member.

Dedicated teams

Dedicated teams provide you with a turn-key, well-oiled, development machine.

You benefit from your partner’s experience delivering projects as a team, thereby providing built-in velocity from the very start of your project.

The concept of bringing work to teams is a hallmark of creating a zen-like Agile development team.

The team is selected based on your unique project requirements with the major benefit being the turn-key nature of a dedicated software development team. You can go from 0-60 without requiring the need to bring any of your own resources to the plate, or more importantly disrupt your key resources from other critical projects.

These contracts are typically structured in a fixed monthly price for the entire team making budgeting for your project easy.

This model gives you the flexibility you need to build great software. You have control over the scope of your project as it evolves vs the alternative of incurring change requests from your partner every time a requirement changes.

At HatchWorks, we favor this approach because it is built for you, the customer. Check out our approach.

Fixed-price outcome based

The last model is a slight tweak on the dedicated team model.

Instead of paying a fixed monthly price for the capacity of the team, you are paying for the outcome your partner will deliver or the delivery of predefined scope.

This model gives you the least amount of oversight on the project as your partner is working as an autonomous team to deliver the against the agreed upon outcome.

While this model can be a win-win for both you and your partner, it is important you both have a clear understanding of the scope and the defined outcomes you are looking to achieve.

Outsourcing service models comparison diagram.

What about the location of my outsourced development team?

Location is one of the most important considerations when selecting an outsourced development team, but not in the way you may think.

It is no longer vital to be physically collocated with your partner. Many teams are working remotely and have proven to do so successfully.

What is most important is being aligned by timezone so you can share the day’s work.

Nearshore presents the best option for US companies providing you with the right team at the right value for today’s remote world.

For more on nearshore software development, check out our guide.

How to manage and work with an outsourced development team

This is largely dependent on the type of outsourced development team model you are working within. However, in any case, you should be taking an Agile approach.

If your partner is not skilled in Agile, you may want to search for a new partner, because building great software requires it.

As the main stakeholder, you should be involved in some of the Agile ceremonies acting as a feedback loop for the team.

In an integrated team, your partner will be involved in all the ceremonies along with your team.

In a dedicated team or a fixed-price outcome-based approach, you may just be involved in the below major sprint ceremonies:

Sprint planning

In sprint planning, the team determines the items that will be added to the next spring backlog to be worked. It is important you are up to speed and provide perspective when necessary about what is the highest priority.

Sprint review/demo

This is the most critical and often most exciting meeting for you to attend. This is where you get to see the working software being delivered after each sprint. It allows you to create feedback on what is being delivered, and stay up to speed on the progress of the project.

Note: if your partner is not delivering working code on a regular basis, you may have a bigger problem worth diagnosing.

Client partner sync

This meeting can be by different names, but it is critical to have a meeting with your partner on a regular basis outside of the sprint ceremonies. This allows you time to level set with your partner on status, risks, assumptions, and any changes in your project.

A good partner will always bring up any risks, issues, or blockers proactively so they do not fester and become bigger issues.

How to get started with an outsourced development team

Figuring out where to start can be scary.

There are literally thousands of partners out there, many positioning the same way. So how do you vet who to work with and get to a short list? Here are a few tactics to help with finding the right partner.

Ask your friends and colleagues

Asking your friends and colleagues about partners they have worked with before and had success with is a great starting point. This is typically the most unbiased and loyal perspective you will get.

Review listing services

There are several listing services out there that can help you identify top partners to work with within the area you are focused on. Clutch, DesignRush, G2, The Manifest, and GoodFirms are great starting points when looking to create an initial list of partners to talk with. These listing services will have reviews and many times past work examples so you can do your own research first.

Now that you have made a short list, how do you make your decision? Here are the main things you need to consider when making your decision.

Where do they operate?

Where your partner operates and has development hubs is an important consideration. Now that most teams are remote in some form or fashion, being physically collocated is no longer a significant consideration. See if your partner has development hubs in other countries allowing you to take advantage of a wider pool of talent and a better return for your investment. If you are a US firm, a partner with a presence in Latin America is critical.

Operating model

We hit the different operating models earlier, but it is important to be aligned on how your preference for delivery and how your partner delivers. Ensure you are on the same page, and they can deliver in a way you are comfortable with.

Domain expertise

This is critical in shortening time to value. A partner that has domain expertise in your industry, way of working, or other disciplines means that can deliver quicker with better quality as it will take them a shorter amount of time to get up to speed.

Work examples and references

Make sure to ask for past work examples, especially those in your industry. This will give you a good barometer check to see if they have delivered similar solutions in the past. Reviews and references from past customers are also a great way to see what other clients say about the partner you are vetting.

How quickly they can get started

One sometimes overlooked consideration is how quickly can your partner get started. Most partners in today’s talent shortage don’t always have a ready-and-waiting bench ready to start on your project.

It is important to know this early in your discussions with your prospective partner. Look for a partner that has a well-defined and structured recruitment process that can build the right team in as short a time as possible so you can get started.

Culture and retention

Last, and probably one of the most important factors is the culture and retention rates of your partner. (PS. these are related). A partner with a strong culture will be able to better retain their people and create an environment where team members go the extra mile to deliver for their clients.

The last thing you want is a revolving door of talent from your outsourcing partner because domain and solution expertise will go out the door with them. This causes unnecessary delays in delivering the right software solution.

Summary

Finding the right outsourcing software development partner is not easy, but the right partner can be worth its weight in gold.

If you are in the market for a software development partner, let us know.

HatchWorks can help you build the right digital product, the right way through our integrated US and nearshore Agile teams. Whether you are starting from scratch or modernizing a legacy solution, we can help you create a software solution that delivers real business value.

Getting Started with HatchWorks Is Easy

Contact us to learn about our Agile Consulting solution for distributed Agile Development Teams, and get back to focusing more on your product and less on your process.

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]]> The Evolution of Digital Transformation: From Pre-Internet to Post-Pandemic https://hatchworks.com/blog/product-design/history-digital-transformation/ Fri, 03 Feb 2023 20:45:16 +0000 https://hatchworks.com/?p=29097 Digital Transformation has an interesting history before becoming one of the most talked about buzzwords in the business world today. You likely have heard it mentioned in your CEO’s strategic initiatives. However, what once seemed like lip service for stakeholders and investors has now become a critical part of staying competitive in today’s market. Spending […]

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Digital Transformation has an interesting history before becoming one of the most talked about buzzwords in the business world today.

You likely have heard it mentioned in your CEO’s strategic initiatives. However, what once seemed like lip service for stakeholders and investors has now become a critical part of staying competitive in today’s market.

Spending on digital transformation has reached a staggering $1.6 trillion in 2022 and is projected to reach $3.4 trillion in 2026.

That is some serious investment.

But where did the idea of digital transformation come from? Let’s first define what it is.

The Evolution of Digital Transformation: From Pre-Internet to Post-Pandemic.
In this brief guide, we cover:

What is digital transformation?

Digital transformation refers to the use of digital technologies to modify or create new business processes, customer experiences, and organizational culture in response to changes in the market and business needs. In some cases, this can lead to complete shifts in business models creating seismic waves throughout an organization.

Now that we have a better understanding of what digital transformation is, let’s look at its history and how it has evolved over time.

A brief history of digital transformation

There are four distinct eras in the evolution of digital transformation that has forced companies to adapt how they operate and serve their customers. Those who have been unable to adapt typically go the way of the dodo bird.

Pre-internet Era

1950 – 1989
This is where the foundational building blocks of the digital revolution were created. The invention of microchips and semiconductors enabled manual processes to be converted into digital technologies.

This started the first major digital transformation. Companies focused on shifting outdated processes to digital data. Worldwide, this created a need for business transformation and cultural change.

  • 1958 The microchip and semiconductor were invented
  • 1960 Moore’s Law defined

Post-internet Era

1990 – 2006
The next digtal era created massive change. The internet started the shift from a siloed world into a global one. Connection and access to data through the public accessibility of the internet createda more ubiquitous playing field. Personal computers exploded during this era, giving people terminals to the world wide web in their living rooms, and the first social networks began to crop up.

This era drove change in existing processes and business operations with the creation of the internet and increased access to customer data. More importantly, it caused companies to rethink their customer interactions as the internet significantly changed how people interacted, search, and buy.

  • 1990 Internet becomes publicly available
  • 1998 Google founded
  • 2000 Half of US households have a personal computer
  • 2004 Facebook founded
  • 2005 Internet users reach $1 billion worldwide
  • 2006 AWS created

Mobile Era

2007 – 2019
Just when companies were becoming comfortable with the modern internet and its impact on their business, another foundation shift happened with the introduction of the iPhone and the shift to mobile. This opened up a world of possibilities, new business models, and the introduction of new social and mobile channels, which drove another spike in digital transformation.

Marc Andreesen’s seminal writing, “Why Software is Eating the World”, laid out a clear vision of the future where software would disrupt every industry across the globe, and how new software-centric players would have the upper hand in this new world.

Interestingly enough, this is also around the time when the term “Digital Transformation” was first coined. Now the cycle of change required to stay competitive had a name.

  • 2007 iPhone released giving rise to the mobile revolution
  • 2011 “Why Software is Eating the World” written
  • 2013 The term “Digital Transformation” is coined

Post-Pandemic Era

2020 – Present
The last major era, and the one we are currently in right now, is the post-pandemic era. The pandemic accelerated digital innovations as companies were forced to rethink how they served their customers in a non-contact and remote world.

This ushered in shifts in business models and forced companies to take their digital transformation initiatives from the board room to the front lines with new urgency. This acceleration was the push many companies needed to implement a better customer experience.

Advances in AI and machine learning are playing a huge role in digital transformation initiatives. While the history of AI warrants its own timeline, advances in machine learning and tools like ChatGPT are clearly going to drive even more change in the way we work, interact, and live.

  • 2020 Global Pandemic
  • 2022 Digital Transformation spending at $1.6 trillion

How to approach digital transformation

Each digital era has caused businesses to rethink their internal operations and customer expectations. It has created fertile ground for new market entrants and has shifted, created, and even retired whole business models.

Where businesses get digital transformation wrong is by viewing it as something that can be completed or reach a state of maturity. Instead, digital transformation should be viewed through a lens of continuous development. Something you are always improving and optimizing upon.

However, even if you approach it in this manner, digital transformation is HARD.

Changing processes and replacing existing systems are not for the faint of heart. At HatchWorks, we leverage a proven approach when modernizing digital solutions called MVR (Minimal Viable Replacement). This approach focuses on breaking up the needs of the new system(s) into a clearly defined roadmap. This roadmap focuses on delivering valuable chunks of functionality into the hands of real users as soon as possible with minimal impact on their existing work.

Essentially, an MVR is the culmination of all the MVPs required to migrate existing customers to your new solution with minimal loss of existing customers.

Frequently Asked Questions about Digital Transformation

Some key events in the history of digital transformation include the rise of the internet, the emergence of social media, the development of mobile technology, and the growth of cloud computing and big data analytics.

All industries have been impacted by digital transformation to some degree, but some of the most significant changes have occurred in the retail, financial services, media, and entertainment industries.

Digital transformation has had a profound impact on society, enabling people to connect, communicate, and collaborate in ways that were previously unimaginable. It has also changed the way we access information, shop, and consume media.

The future of digital transformation is difficult to predict with certainty, but it is likely to involve continued advancements in artificial intelligence, the Internet of Things, and other emerging technologies. It will also involve the ongoing integration of digital technology into all aspects of business and society.

Organizations can benefit from digital transformation in many ways, including improved efficiency and productivity, enhanced customer experiences, greater agility and competitiveness, and the ability to generate new revenue streams and business models.

Organizations may face a number of challenges when undergoing digital transformation, including the need to update legacy systems, the complexity of integrating new technologies, and the potential for disruption to existing processes and organizational culture.

Digital transformation has changed the way we work in many ways, including the ability to work remotely, the use of digital tools and platforms for collaboration and communication, and the rise of the gig economy and other flexible work arrangements.

Getting Started with HatchWorks Is Easy

Want to learn more about how to modernize your existing digital solutions through an MVR approach?

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]]> MVP or Prototype? A Guide to Choosing the Right Approach for Your Idea https://hatchworks.com/blog/product-design/mvp-vs-prototype/ Wed, 01 Feb 2023 16:06:51 +0000 https://hatchworks.com/?p=29100 When it comes to bringing a new product to market, it’s important to test your idea to ensure its success. One way to do this is by using prototypes and minimum viable products (MVPs). Both prototypes and MVPs can be useful tools in the product development process, but it’s important to understand the key differences […]

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When it comes to bringing a new product to market, it’s important to test your idea to ensure its success. One way to do this is by using prototypes and minimum viable products (MVPs). Both prototypes and MVPs can be useful tools in the product development process, but it’s important to understand the key differences between the two and how to choose the right approach for your product.
MVP or Prototype? A Guide to Choosing the Right Approach for Your Idea.
In this guide, we’ll explore the definitions and purposes of prototypes and MVPs, as well as the benefits and drawbacks of each approach. We’ll also discuss how to decide between a prototype and an MVP and provide some examples of each. By the end of this guide, you’ll have a better understanding of the role of prototyping and MVPs in product development and how to choose the right approach for your product.

What is a software prototype?

A software prototype is a preliminary model of a software application that is used for testing and demonstrating the concept. Prototypes can range from simple wireframes or mockups to complex, functional prototypes that closely resemble the final product. The purpose of a software prototype is to test the application’s design, functionality, usability, and feasibility before it is fully developed.

Prototyping allows developers to identify and fix any design or technical issues early on in the development process, saving time and resources in the long run. It also allows for user testing and feedback, which can help fine-tune the application and ensure that it meets the needs and preferences of the target audience.

There are 3 main types of prototypes:

  1. Wireframes: Wireframes are simple, low-fidelity diagrams that outline the layout and structure of a product. They are typically used early in the design process to establish the basic structure and functionality of a product. Wireframes are usually black and white and do not include detailed design elements or interactive features.
  2. Mockups: Mockups are static, high-fidelity visual representations of a product. They typically include more detailed design elements and may include some interactive features, such as clickable buttons and links. Mockups are useful for demonstrating the overall look and feel of a product, as well as for gathering feedback on the design.
  3. Interactive prototypes: Interactive prototypes are dynamic, high-fidelity representations of a product that allow users to interact with the product as if it were a fully-featured product. They can include a wide range of interactive features and can be as detailed and functional as the final product. Interactive prototypes are useful for testing the usability and user experience of a product and for demonstrating the full range of features and functionality to potential investors or customers.

The benefits of software prototyping include:

  • Identifying and fixing the design and technical issues early on
  • Gathering user feedback and testing the usability of the application
  • Demonstrating the concept and functionality of the application to potential investors or customers
  • Allowing for iteration and improvement of the application before full development

It’s important to note that software prototypes are not meant to be the final product, and are typically not intended for sale or distribution. They are simply a way to test and refine the concept before moving on to the next stage of development.

What is an MVP?

An MVP, or minimum viable product, is a product with just enough features to be viable for a specific group of customers. The purpose of an MVP is to quickly test a product idea with a small group of users in order to gather feedback and data. This information can then be used to improve the product and make it more appealing to a larger audience.

MVPs are typically stripped-down versions of a product, with only the most essential features included. This allows the product to be released and tested in the market more quickly and at a lower cost. MVPs are intended to be functional products that can be sold, but they are not necessarily the final version of the product.

Examples of MVPs include a basic version of a mobile app that only includes the most essential features with limited customization options.

The benefits of MVPs

The benefits include:

  • Allowing for quick testing and validation of a product idea
  • Gathering valuable data and feedback from real users
  • Reducing development time and costs by focusing on only the most essential features
  • Providing a way to test the market and gather traction before investing in a full product rollout

It’s important to note that MVPs are not meant to be a fully fleshed out product, but rather a way to quickly test and validate an idea. As such, they may not be suitable for all products or industries.

How to decide between a prototype and an MVP

When it comes to choosing between a prototype and an MVP, there are several factors to consider. Here are some things to think about when deciding which approach is right for your product:
  • Stage of development: If you are in the early stages of product development and are still trying to figure out the basic concept and functionality of your product, a prototype may be the way to go. Prototyping allows for more experimentation and iteration. It is a good way to test and refine the basic idea. On the other hand, if you have a more fleshed out product idea and are ready to test it in the market, an MVP may be the better choice.
  • Purpose of the product: Consider the purpose of your product and whether a prototype or MVP is better suited to achieving your goals. For example, if you are developing a complex product with many features, a prototype may be necessary to fully test and demonstrate all of the functionality. On the other hand, if you are trying to quickly test a simple product idea with a specific group of users, an MVP may be more appropriate.
  • Resources and time constraints: Prototyping can be a time-consuming and resource-intensive process, especially if you are creating a complex prototype. If you are working with limited resources or time constraints, an MVP may be a more feasible option. MVPs can be developed and tested more quickly and at a lower cost than prototypes, making them a good choice for startups and small companies.

Pros and cons of prototyping

  • Pros: Allows for more experimentation and iteration, allows for full testing and demonstration of product functionality, can be useful for complex products
  • Cons: Can be time-consuming and resource-intensive, may not be suitable for testing in the market

Pros and cons of MVPs

  • Pros: Allows for quick testing and validation of a product idea, can be developed and tested more quickly and at a lower cost, provides a way to test the market
  • Cons: May not be suitable for complex products or products with many features, may not provide a full understanding of the product’s functionality

Conclusion

Prototyping and MVPs are both important tools in the product development process, each with their own benefits and drawbacks. It’s important to carefully consider the stage of development, the purpose of the product, and the resources and time constraints when deciding which approach is right for your product.

Prototyping is a good choice for testing and refining the basic concept and functionality of a product, especially for complex products with many features. MVPs, on the other hand, are a good choice for quickly testing a product idea with a specific group of users and gathering data and feedback.

An additional approach is the MVR (Minimal Viable Replacement) which comes in handy when you are looking to modernize an existing digital product. To learn more, check out our blog, Minimum Viable Replacement: A New Approach to Modernizing Legacy Solutions.

By understanding the role of prototyping and MVPs in product development and how to choose the right approach for your product, you can ensure that you are well-equipped to bring your product to market successfully.

HatchWorks’ Proven Approach to Iterative Software Development

Building a new digital product is not easy, but we have the approaches and frameworks to ensure you are building the right digital product the right way, one that your customers and business will love.

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]]> Minimum Viable Product (MVP) vs Minimum Viable Replacement (MVR) – Understanding the Difference https://hatchworks.com/blog/product-design/mvp-vs-mvr/ Tue, 31 Jan 2023 21:04:06 +0000 https://hatchworks.com/?p=29128 Contrary to popular belief, the Minimum Viable Product (MVP) approach is not the only way to build a digital product. While it is a proven approach to building and validating new solutions, it falls flat when looking to replace an existing solution. So how do you approach modernizing an existing solution? Enter the Minimal Viable […]

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Contrary to popular belief, the Minimum Viable Product (MVP) approach is not the only way to build a digital product. While it is a proven approach to building and validating new solutions, it falls flat when looking to replace an existing solution.

So how do you approach modernizing an existing solution? Enter the Minimal Viable Replacement (MVR), which focuses on building the minimal set of features needed to replace an existing solution and provide an improved experience for users.

Whether you’re in product, engineering, or running a project, understanding the difference between MVP and MVR will give you a powerful toolset for creating and improving digital products. Let’s start by defining each and then get into what makes them different.

MVP vs MVR - Understanding the Difference.
In this guide, we cover:

What is a Minimum Viable Product (MVP)?

An MVP, or minimum viable product, is a product with just enough features to be viable for a specific group of potential customers. The purpose of the MVP development process is to quickly test a product idea with a small group of users in order to gather feedback and data. This information can then be used to make a determination to continue, pivot, or stop development if the idea does not prove viable.

MVPs are typically stripped-down versions of a product, the smallest possible product, with only the most essential features and minimum functionality included. This allows the product to be released and tested in the market more quickly and at a lower cost. MVPs are intended to be functional products that can be sold, but they are not necessarily the final product.

The MVP approach is typically taken by startups who are looking to quickly validate a business idea or larger companies who are looking to test a new greenfield idea separate from their current products.

What is a Minimum Viable Replacement (MVR)?

A Minimal Viable Replacement (MVR) is an approach, popularized by Kevin Mireles, to replace a legacy solution that has an existing base of users or customers. With an MVR, you already know a market exists for your solution. The question becomes, can your new solution meet and exceed the value delivered by your old solution?

The approach focuses on decomposing the needs of the new system(s) into a clearly defined roadmap. This roadmap focuses on delivering valuable chunks of functionality into the hands of target users as soon as possible with minimal impact on their existing work.

Essentially, an MVR is the culmination of all the MVPs required to migrate existing customers to your new solution with minimal loss of existing customers. This approach is typically taken by mid-market or large companies that have existing solutions that need modernizing in some way.

To learn more about the approach, check out Minimum Viable Replacement: A New Approach to Modernizing Legacy Solutions.

What is the difference between MVP and MVR?

The key difference between MVP and MVR is in the goal and approach. While nuanced, they are critical to understanding when determining which approach is ideal for your software development project.
MVP MVR
Primary goal: validate a market or product hypothesis
Primary goal: migrate existing customers to the new modern system with minimal churn allowing for more agility
No existing customers
Existing customer base
Focused on attracting new customers
More focused on retaining existing customers than attracting early adopters
Competing against other companies or existing behaviors
Competing against your existing solution
Deeper research required to vet the viability of the solution
Minimal research required as the solution has already been proven to have market fit
Focused on a very small set of target customers and use cases to prove out the product’s value proposition
Focused on identifying the most valuable and sometimes extreme use cases for your most valuable customer segments among the many existing customer segments
Focused on new functionality
Focused on improving core functionality first, and typically new capabilities second
Targeted few specific workflows
Many existing workflows exist with existing users typically creating their own a-typical process within your system
Leverage new technology
Have to account for existing legacy technology
Ability to create new processes with a greenfield project
Must account for existing organizational norms, process, and culture

Why building new products and updating existing ones require a completely different approach

MVP and MVR are two important approaches in product development. Understanding each can help you determine which approach is best for you, and prevent you from wasting time, money, and resources, and losing customers.

Taking on an MVR is not for the faint of heart. You need a partner who can help guide you through the process, and not only protect your existing base of users but ensure you are set up for future growth.

Contact us to learn more about the MVR approach and how we can use it to turn your modernization project into one that will be the gold standard for future projects to come.

Getting Started with HatchWorks Is Easy

Want to learn more about how we deliver solutions that are valuable, usable, feasible, and viable through our integrated US and Nearshore delivery model? No matter what phase you are at in your software solution journey, HatchWorks can help you create a user experience your customers will love.

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]]> 15 UX Statistics You Need to Know in 2023 https://hatchworks.com/blog/product-design/user-experience-statistics/ Fri, 20 Jan 2023 21:05:59 +0000 https://hatchworks.com/?p=28966 A great UX (User Experience) feels like magic. It feels effortless, leaving the user saying, “How did you do that?!” Even more important, they tell their friends. Getting organizational buy-in for UX can be difficult though. These stats can help you make the case for why you should invest in UX, and the risk if […]

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A great UX (User Experience) feels like magic. It feels effortless, leaving the user saying, “How did you do that?!” Even more important, they tell their friends.

Getting organizational buy-in for UX can be difficult though. These stats can help you make the case for why you should invest in UX, and the risk if you do not. Before the stats, let’s define what is UX.

15 UX Statistics You Need to Know in 2023.

What is UX?

UX encompasses all aspects of your user’s interactions with your company, its products, and services from initial interaction with your brand, through purchase, use of your solution, and ultimately end of use.

The first core principle of a great user experience is actually meeting the needs of your customers. You need to complete their specific job to be done in an easy, seamless way.

This requires simplicity and elegance in how your experience is designed. Your product should be a joy to use. You want to leave them saying, “I have to tell someone about this!”

Now let’s get into 15 statistics that show why UX is crucial for your business.

Why you should invest in UX

1. Research shows that, on average, every $1 invested in UX brings $100 in return. Source: Forrester

That is a 100X return. If you are needing to get buy-in from your CFO as to why you should invest in UX, show them this.

2. The top companies leading in user experience outperformed the S&P index by 35%. Source: Forbes

Good user experience ultimately is the difference between winning and losing in today’s market. The customer has the power and an endless pool of options.

That is why top companies around the world like Airbnb, Apple, and Google invest heavily in UX. They know it is the secret to growth and competing in a crowded market.

3. 8 in 10 customers are willing to pay more for a better customer experience. Source: Capgemini

Back to the ROI of UX, your users crave a simple elegant solution. A thoughtful user experience is the way to do that.

4. A well-designed user interface could raise your website’s conversion rate by up to 200%, and a better UX design could yield conversion rates up to 400%. Source: Forrester

Yes, UI is important but UX is the real driver of growth. It is easy to get sucked into the aesthetics of your solution. Don’t do this. Start with the experience, and then add the coat of paint and tchotchkes to make your solution stand out.

The risk of not investing in UX

5. Businesses lose 35% of sales due to bad UX. Source: AWS

According to a study by Amazon Web Services, eCommerce businesses leave 35% of sales on the table due to bad user experience. This translates to roughly $1.4 trillion worth of sales. (yes trillion with a “T”)

Lost sales because of bad UX are over $1.4 trillion whereas projected global sales due to good UX are over $5 trillion.

6. 70% of customers abandon purchases because of bad user experience. Source: Baymard

User Experience encompasses the whole experience including purchase. Don’t just focus on your post-purchase experience. Otherwise, you are leaving money on the table.

7. 32% of users will leave a brand they love if they have one bad experience. Source: PWC

This is mind-blowing… While it takes many great experiences to create “love” in the mind of your customers, it only takes one bad experience for some to leave your brand altogether.

8. 67% of customers claim unpleasant experiences as a reason for churn. Source: Forbes

This should be no surprise. Keeping your existing customers is one of the easiest ways to drive and grow revenue. Good UX can accomplish this.

9. 62% of customers say they share their bad experiences with others. Source: Salesforce

Not only is it bad when your customers churn and you lose revenue, but it can have a multiplier effect by telling others about the negative experience. This can create the worst type of snowball effect that can be tough to control once it starts rolling.

10. 3 out of the 12 reasons why projects fail are attributed to user experience failures. Source: AWS

So much time and effort is focused on the technical solution and how it looks, while 3 of the 12 main reasons projects fail are directly attributed to your UX.

11. The time spent by developers reworking a project with avoidable faults is 50%. Source: AWS

It is important to be proactive with your UX, and not reactionary. Not only because it is easier for you and your team, but it is also way more cost-effective. Start with UX first. Then build your product.

UX stats that make you think

12. 85% of UX problems can be solved by testing 5 users. Source: Nielsen Norman Group

One of the most important elements of UX is talking to your customers. This seems like a big hurdle and is often not done due to the perceived effort. It may not be as intensive as you think. Just talk to 5 people, and you may uncover some major issues and opportunities.

13. There was a success rate of 80% when people used the navigation scheme structured according to most users’ mental model. There was a success rate of 9% when people used the navigation scheme structured according to the company’s internal thinking. Source: Nielsen Norman Group

In the world of UX, new is not always good. Sometimes it is better to be familiar. Use common mental models as a tool to make your user experience easier for your customers. That way they are using fewer brain calories when learning how to use your product.

14. Today customers manage 85% of their relationships without interacting with a human. Source: Gartner

User experiences without human interaction provide so many different options to delight your users. Be intentional about your experience. Customers don’t just prefer non-human interaction, they expect it to work seamlessly.

15. 81% Of Consumers Say They Want More Self-service Options. Source: CXM Today

The pandemic changed many things in our world including how people interact with brands and products. Customers don’t just prefer self service, they require it. If your experience doesn’t measure up, customers will look for other options.

Final thoughts

In today’s world, you can’t afford not to prioritize UX. It is a foundational aspect of any software solution. Don’t discount its value. Make it a priority early in your solutions life, even before you start building. If you already have an existing solution, it isn’t too late. Identify the biggest opportunity areas and start executing those changes.

Your customers will thank you.

Do You Need Help with UX Research?

Our experts can help you define and execute a comprehensive UX research study to validate and build confidence that your product is on the right track.

No matter what phase you are at in your software solution journey, HatchWorks can help you create a user experience your customers will love.

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]]> Minimum Viable Replacement: A New Approach to Modernizing Legacy Solutions https://hatchworks.com/blog/product-design/minimum-viable-replacement/ Wed, 18 Jan 2023 19:30:55 +0000 https://hatchworks.com/?p=29000 Minimal Viable Products (MVPs) have become the sole defacto way of building software. If you are not taking an MVP approach, you may get strange looks nowadays. It has been proven time and time again as an effective way to quickly test a market hypothesis or build a proof of concept to test the technical […]

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Minimal Viable Products (MVPs) have become the sole defacto way of building software. If you are not taking an MVP approach, you may get strange looks nowadays.

It has been proven time and time again as an effective way to quickly test a market hypothesis or build a proof of concept to test the technical feasibility of a solution. But what happens when you are not building a new solution and instead you are modernizing or replacing an existing one?

If you are using an MVP approach in this scenario, you will be in for a rude awakening in the form of wasted time, money, and unhappy customers.

Don’t worry… there is a better way. The Minimal Viable Replacement (MVR).

Minimum Viable Replacement: A New Approach to Modernizing Legacy Solutions.
In this guide, we’ll cover:

What is a Minimal Viable Replacement (MVR)?

A Minimal Viable Replacement (MVR) is an approach, popularized by Kevin Mireles, to replace a legacy solution that has an existing base of users or customers.

These modernization or replacement projects are often labeled with the overused term, Digital Transformation. No matter what you call it, they all have one thing in common.

Complexity.

With an MVR, you already know a market exists for your solution. The question becomes, can your new solution meet and exceed the value delivered by your old product?

The approach focuses on decomposing the needs of the new system(s) into a clearly defined roadmap. This roadmap focuses on delivering valuable chunks of functionality into the hands of real users as soon as possible with minimal impact on their existing work.

Essentially, an MVR is the culmination of all the MVPs required to migrate existing customers to your new solution with minimal loss of existing customers.

Why the MVP doesn’t work when replacing an existing solution

By now, we have all seen this age-old MVP metaphor.
A diagram illustrating why incremental progress doesn't cut it for modernizing legacy solutions.

The goal of an MVP is to provide end-to-end value in an incremental fashion. In this example, the desired outcome is to get from point A to point B, and the first iteration of the solution, the skateboard, accomplishes that right off the bat.

The problem is, your existing customers are not willing to trade down to a skateboard when they are currently driving a car with a leather interior, air conditioning, and Bluetooth. Oh, and a few of those other important features like seat belts, airbags, and brakes…

To make this real, picture handing your existing customers a skateboard and asking them to test it out riding down the highway. That is a sure recipe for disaster and guaranteed loss of revenue.

Aerial photo of a busy freeway.

The major differences between an MVP and an MVR

MVP MVR
Primary goal: validate a market or product hypothesis
Primary goal: migrate existing customers to the new modern system with minimal churn allowing for more agility
No existing customers
Existing customer base
Focused on attracting new customers
More focused on retaining existing customers than attracting new ones
Competing against other companies or existing behaviors
Competing against your existing solution
Deeper research required to vet the viability of the solution
Minimal research required as the solution has already been proven to have market fit
Focused on a very small set of target customers and use cases to prove out the product’s value proposition
Focused on identifying the most valuable and sometimes extreme use cases for your most valuable customer segments among the many existing customer segments
Focused on new functionality
Focused on improving existing functionality first, and typically new capabilities second
Targeted few specific workflows
Many existing workflows exist with existing users typically creating their own a-typical process within your system
Leverage new technology
Have to account for existing legacy technology
Ability to create new processes with a greenfield project
Must account for existing organizational norms, process, and culture

Why an MVR is unique

The typical approach for an MVP leverages the 80/20 rule, which in essence states that 20% of the functionality will serve 80% of the needs of your users. So therefore you should focus on that 20%.

With an MVR it is not that simple…

With an MVR, you have multiple customer segments you must satisfy in order to successfully replace a legacy solution. On top of that, those customers represent different value to your business, typically in the form of revenue or profitability.

Surprise, surprise – your larger, higher value customers typically require more extensive and complex functionality compared to 90% of your typical users.

This is why in an MVR you must consider the edge cases of your most valuable customers.

On top of having to consider edge cases (usually a ‘no no’ with MVPs), there are also two core psychological phenomena at play in an MVR.

Endowment effect: People are more likely to retain an object they own rather than acquire a similar object (either in value or appearance). In essence, people feel a sense of ownership over the systems and technology they currently use and are not typically gung-ho about giving it up.

Loss aversion: People value losses more than they value potential gains. Not just by a little either. They tend to value it by 2 to 4 times more. Anything less than that is likely to be perceived as incredibly negative. In essence, a bird in the hand is worth two in the bush.

We are ultimately creatures of habit, which makes an MVR unique.

A metaphor fitting for an MVR

Picture a 100-story condo. Let’s say you built the first 99 floors in a relatively standard fashion with 12-foot ceilings, standard bathrooms, and fixtures. They each pay $2K a month in rent.

Then you get to the last floor. The penthouse.

This is just one tenant, but they pay $30K per month.

They also have different requirements such as a swimming pool, 30-foot ceilings, and a helipad. If you didn’t account for this upfront, your architecture and design likely won’t support it.

So how do you approach an MVR to ensure you aren’t doing more harm than good?

The MVR approach

The goal of an MVR should be to meet and exceed the value delivered by your old solution without losing your existing customers in the process.

The approach focuses on decomposing the needs of the new system(s) into a clearly defined roadmap that focuses on delivering valuable chunks of functionality into the hands of users as soon as possible with minimal impact on their existing work. The roadmap should show them they don’t have to fear a loss of functionality because you have clearly communicated and mapped out when the functionality will be delivered.

There are 3 standard approaches to the MVR when considering how to develop your roadmap and define key milestones.

Functional Approach: If there is little overlap in functionality between end-user segments, you can structure your roadmap based on the specific functional needs of those different customer segments.

Diagram of a functional approach.
Process Approach: If your system covers long processes with no clear delineation by customer segments you can approach structuring your roadmap by the different processes and workflows within the system. Look for a natural break in the process to define replacement points where you can take segments of the process and replace them with the new system.
Diagram of a MVR process approach.
Add-On Approach: If you are looking to go after a new market or customer segment this is a good approach allowing you to create a newer leaner system focused on first adding that new target market or customer base. Then as the functionality builds up, you can migrate your existing customers to the new solution. This can be packaged as an add-on to your existing solution so as to not disrupt existing users, or make them feel like they are loosing their existing legacy solution in the process.
Diagram of a MVR add-on approach.
Below are some key elements to consider when taking on an MVR:
  1. Identify, define, and prioritize your different customer segments based on required functionality and value to your business
  2. Identify the edge cases your highest value customers must have to switch
  3. Align on if you are building the replacement solution for a new customer segment you are targeting in the market, and identify if this shift in strategy will result in churn of existing customer segments.
  4. Identify instances of customers using your solution in unintended ways (note: these are opportunity areas to build functionality to make these workarounds easier)
  5. Determine all the downstream applications and organizations using your systems inside and outside of the company
  6. Understand how users and organizations are using your solution and its data.
  7. Identify any regulatory or compliance-related requirements
  8. Determine if the new solution can start as an extension of the legacy one and sold as an add-on to start. Then, integrate the core functionality as part of your replacement strategy.
  9. Identify if there are any underserved customer segments that are not currently using your solution and would be happy with a true MVP
  10. Define your roadmap by breaking up the project into mini MVPs defined by functionality and customer segment served

Summary

At the end of the day, it is not a question of if you will need to replace legacy solutions. It is a matter of when.

While legacy solutions, processes, and technical debt have a knack for slowing down progress, you can’t let them hold you hostage.

Leverage an MVR approach to enable agility and innovation in your organization so you can continue to deliver value for your customers and your business.

Getting Started with HatchWorks Is Easy

Want to learn more about how we deliver solutions that are valuable, usable, feasible, and viable through our integrated US and Nearshore delivery model? No matter what phase you are at in your software solution journey, HatchWorks can help you create a user experience your customers will love.

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