Recently, we have observed a growing trend towards the adoption of Low code by IT service companies (ESN).
The traditional software development model seems to be challenged by this new approach to designing applications.
By offering clients a shorter delivery time at a daily rate often equal to traditional development technologies, the Low code approach may seem counterproductive.
Yet, more and more IT service companies are including it in their long-term strategy.
Why ?
Here are the 3 main reasons behind this choice :
1) Reduced costs and accelerated delivery
The main advantage of Low code lies in the speed it offers while maintaining a quality level as high as with a Java/Angular stack for example.
For the client, the project is delivered more quickly, meaning fewer days are billed.
By using Low code platforms, IT service companies can deliver projects in half the time compared to traditional development.
If the project is successful, it results in a satisfied client who will ask again for your services. And customer retention, especially in B2B tech, is crucial given the increasingly fierce competition.
2) Low code reduces inter-contract
An IT service company must constantly search for the best profiles on the market and retain them.
Traditionally, the risk associated with not having the right profile available at the right time for a client can be a challenge.
Low code reduces this dependency. By delivering faster, resources are more available than before and can sometimes respond to a specific need at a given moment.
Additionally, a developer who does Low code development can also do traditional coding. Their expertise includes Low code but is not limited to it so Low code is just an additional skill, meeting a real market need.
3) Markup on license costs
Another economic reason for IT service companies to adopt Low code is the possibility of obtaining markups on the licenses of the platforms used.
Depending on the partnership with different providers, an IT service company can add a margin of 10% to 30% on the cost of licenses.
This markup represents a significant additional revenue source, making the investment in Low code even more attractive.
Thus, the adoption of Low code by IT service companies is not yet widespread, but a trend is emerging. Several IT service companies in Europe have taken this leap by training specialized Low code teams for hundreds of successful projects.
It is a model that works, provided you fully commit to this approach.
