Project Planning in Software Development: Agile vs Waterfall

As a company providing outsourcing software development services, the first decision which you need to take is the development methodology to be implemented. Usually, there are 2 options which are Waterfall and Agile. A development methodology is defined as a process through which you manage your software development work.

outsourcing software development

Outsource software development implements both Waterfall and Agile, as both are defined as a feasible and productive environment.

A brief on the 2 outsource software development platforms.

  • Waterfall
    The “traditional” methodology. It implements a sequential way of going about tasks. All the tasks depend on the deliverables of the previous tasks.
  • Agile
    Brings in rapid deployment of software creation tasks through the self-organising and cross-functional teams. It is a fast set-up which enables us to work as a collaborative team on the projects.

Waterfall and Agile bring their own set of advantages and disadvantages when implemented. There is an underlying set of differences between these platforms. The selection of these platforms is highly dependent on the type of software projects being created.

Let us look at the list of differences between Waterfall and Agile, which will help you, as a provider of outsourcing software development services, to choose between the two.

Agile vs Waterfall: Difference between the 2 outsource software development. 

We will look at the differences from the viewpoint of the various pointers.

  • Involvement of Customers
    Agile involves the customers throughout the software creation process as it applies the concept of self-organising teams in the process.
    On the other hand, Waterfall involves its customers only at the time of reaching certain checkpoints during the software creation process.

There is ample involvement of customers in both the models which shall reduce the level of risk. Customers are the best guide when going about a software creation process.

  • Scope of the software creation process
    In the Agile architecture, the scope is not known in advance as the environment inculcates various changes throughout the process.
    While in the waterfall architecture, the scope is known in advance as it limits the changes to be applied during the creation process.

An unfixed scope gives us the leverage of implementing change which can be beneficial as changes open up new avenues for the developmental project. A static contract sometimes restricts changes which lead to monotony.

  • Prioritisation of features
    In Agile architecture, most valuable features are implemented first to decrease the risk of complete failure. This way, Agile architecture reduces the risk of funding inefficiency. This approach enjoys the benefit of partial success which acts as a motivation booster.
    Waterfall methodology follows the approach of “all or nothing” during the implementation of features. This approach increases the risk of failure as everything is pitted against the possibility of it being a success.

In this situation, the terms of the contract are very important. If they do not seek partial success, then you might have to go for the Waterfall methodology. If they seek a step-by-step implementation, then Agile is the one to go for. Though, Waterfall ideology does increase the level of risk involved.

  • Working Team
    Teams working on an Agile methodology follow the concept of short-specialised teams having a high level of synchronisation amongst themselves.
    In the Waterfall methodology, team synchronisation is worked out when the deliverables are exchanged at transition points.


A team which is specialised and infuses a high level of synchronisation is an obvious choice. If the contract has been issued to different vendors keeping in mind the requirement, then a single-specialised team will not work.

  • Funding for the Development Project
    An Agile methodology works best in cases where the funding is not fixed for the project. As Agile implements several stepwise changes to suit the software development work; therefore, a pre-determined fund allocation shall be problematic.
    In the Waterfall methodology, funds are pre-allocated as fixed-price contracts are signed in this environment.


When the scope is not fixed, then a fixed fund allocation might not work compared to a situation wherein the scope has been fixed. Non-allocation of fixed funds gives you the flexibility to experiment and derive the best outcome.

Overall Conclusion

Agile is a better methodology when seeking a dynamic workflow for creating software. It gives you the leverage to experiment through a highly specialised and cross-functional team.

On the other hand, Waterfall works best in a fixed scenario where you just must do what the contract demands you to. If the contract has certain constraints, then it is best to go with Waterfall.

We can conclude that both the methodologies work best in their respective scenarios. You, as a company who is providing for outsourcing software development services, must assess the situation and choose the environment which you want to implement. You just should not look at the feasibility of the environments but look at the type of projects which you must work on.

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Article Author Details

Christina Woodard