How to Run a Software Product Development Process

The software product development process is complex and includes a series of crucial steps, numerous possible challenges and considerations, and two key methodologies. Whether you are developing a software product with a full-time in-house team, collaborating with a development partner, or outsourcing your project, understanding not only the basics but also the complexities and intricacies of the software product development life cycle is essential for success. So, let’s talk in detail about the software development process and how to run it with maximum efficiency. 

What is Software Product Development?

Software product development, also known as software development life cycle (SDLC), combines stages, methodologies, tools, and management models to ensure effective teamwork, stay on budget, adhere to best practices, and deliver a software product following project requirements. The software product development process usually involves technical and non-technical team members and goes beyond designing, coding, and deploying products. 

Stages of the Software Development Process 

To better understand how to develop a software product, it is essential to understand all key stages of this process. 


Every product development starts with an idea. To ensure that this idea has a chance to succeed in this competitive landscape, it is crucial to conduct brainstorming sessions to answer critical questions about your future product vision, its mission, the tech stack and development team you need to deliver the product, and the potential budget. Based on this information, you can start creating a product roadmap, compose a list of core features, and define potential risks and setbacks early on. 

Discovery Phase

You need to conduct thorough research to ensure that your product will meet the market demand, reach the target audience, and have a competitive advantage over similar solutions. If you lack the expertise within your team, consider hiring professionals with relevant experience. 

The discovery phase is extremely important in the custom software product development process. More and more companies choose to find a reliable IT partner for this stage. With relevant expertise on similar projects and a big team of tech and non-tech professionals, an IT service provider can help you to create a product development plan, realistic timeline, detailed budget, and market strategy. Also, you will get a comprehensive report with market research, industry overview, and information about major competitors. Investing in discovery can help you to avoid many risks and useless expenses down the road. 

Setting Requirements and Feasibility Analysis

When you are finished with brainstorming, discovery, and market research, it is time to set precise project requirements and conduct a feasibility analysis. At this stage, you must thoroughly analyze expected deadlines for product development and launch, key project milestones, team size and structure, tech stack, estimated ROI, and resource allocation. After you finish, all this information must be included in the software documentation

Product Design

This stage involves creating the software architecture of your product and designing the user interface. Based on these, you and your team can decide on tech stack, workflows, system requirements, and methodologies if you haven’t done it during earlier development stages. Also, during product design, many software development teams prefer to build a minimal viable product (MVP) with only key product features. It can help you introduce a product to the target audience, gather valuable feedback, and add new features and functionalities based on these insights to meet customer demands and deliver better results. 

Product Development

When all strategic planning, analysis, and software documentation are finished, the product development team can finally start, probably the most important phase. During this stage, software developers write code, and designers work on the user interface. The product development stage usually takes the longest time of all. If, during previous phases, you set clear requirements and developed a comprehensive product roadmap, the development team should easily follow instructions and create your software product.  

Testing and Quality Assurance

In this competitive landscape, your product needs to be perfect to gain a competitive advantage. So, after coders and designers finish their job, the next step in the software development process is testing and quality assurance.

QA engineers use different tools, frameworks, and methodologies to identify bugs and errors, depending on the management model you choose. At this stage, it is also crucial to release the beta version and gather additional feedback from users. After all bugs are identified and your development team corrects them all, the final product is ready for launch. 


When your software product is ready for a wide audience, the development team needs to work in collaboration with marketing and sales professionals to launch it. Some products require deployment in several stages; some can be introduced in a single release. Also, during this phase, you and your team need to implement one of two options for product deployment: on-premise or cloud-based. This decision depends on the software architecture, tech stack, and system requirements of your product. 

Ongoing Maintenance

After release, your team will receive even more feedback from users and can evaluate your product’s performance in real-life circumstances. At this stage of the software product life cycle, software developers have to make adjustments and quickly solve any problems that may arise. Investing in customer support and regular updates will ensure smooth performance, data security, and user satisfaction. 

Software Development Methodologies

Before the software development process starts, you need to choose a development methodology. Currently, the two most popular and widely used options are Waterfall and Agile models. There is no better or worse option. Every methodology has its pros and cons and suits different kinds of projects. 


This approach is also known as linear or classic. Waterfall is the oldest development model and consists of a series of consequential steps. Every process needs to be 100% completed before moving to the next one, and stages can’t overlap. In most software development projects, the Waterfall approach can be difficult to implement. After receiving feedback during the development process, team members have to go back to previous steps and make necessary changes. 

However, this approach has its advantages. It is easier to estimate the final budget and understand tasks, especially for new developers. If a project is outsourced or handled by an IT service provider, the Waterfall model requires less client involvement. This paradigm is most suitable for projects with clear requirements, explicit business needs, and highly accurate papers. 

Agile or Scrum

Agile product management methodology is the main alternative to Waterfall. With this approach, the development process is divided into small and easily consumable modules and iterations, also called sprints. This model is most suitable for long-term complex projects and allows developers to release new versions of a product several times, making adjustments based on user feedback. Also, user stories are widely used in the Agile model to better meet customer needs and improve user satisfaction levels. 

Scrum is a development framework based on Agile principles. It involves clients more and leverages cross-functional team structure. Also, Scrum is known for its emphasis on experimentation and adaptability to changing circumstances. Often, these two approaches are combined to achieve greater results. Agile-Scrum development is more flexible, involves clients more, and leads to better communication. However, it is more time-consuming, lacks Waterfall’s documentation efficiency, and sometimes increased client involvement can also be seen as a disadvantage. 

Challenges and Considerations

Even with a perfect product development plan, it is impossible to avoid issues completely. Here are the most common challenges and setbacks you may encounter during the software development process and tips for overcoming them. 

  • Unclear requirements. The lack of a crystal clear product development strategy is one of the major challenges software developers can face. This problem can easily result in wasted time, budget, and resources. To avoid this, you should always take the planning stage seriously. Additional investments in market research, business analysis, or discovery phase allow you to avoid many potential setbacks. 
  • Redundant features. It is always tempting to create a software product of your dreams with numerous features and advanced functionalities. However, many of these features can end up redundant and lead to needless spending. Launching MVP and adding new features based on user feedback can help you allocate resources efficiently and create a better user experience. 
  • Lack of proper documentation. Unclear or inadequate software documentation may lead to numerous problems, including challenges during onboarding new developers, maintaining a consistent codebase, and troubleshooting issues. Prioritizing documentation of product requirements, design decisions, APIs, and other aspects will lead to more effective collaboration and knowledge sharing during the development process. 
  • Ineffective communication. This problem can lead to missed deadlines, development delays, and misunderstandings between clients and IT professionals. With the right project management approach, tools, and development methodology, these issues can usually be avoided. 
  • Tech debt. The term is used to describe decisions made during a software development process that can easily pile up and cause various issues later. It includes outdated technologies, infrastructure with low scalability, or inefficient practices. To avoid a negative impact on your product and stay ahead of the competition, regularly assess your product design decisions, identify areas for improvement, and invest in modernizing your tech stack. 


Running a customer software product development process is not an easy task. It requires a lot of expertise, numerous skills, and strategic thinking. Understanding the software development process stages, main development methodologies, and potential setbacks you may encounter is the first step to successfully launching a software product. Even if you are partnering up with an IT services provider or outsourcing vendor, knowledge about the product development lifecycle will significantly increase your chances of success in this competitive landscape of the software development industry. 

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