7 Compelling Benefits of Innersourcing for Your Business

6 minutes read
27 June 2023

As technology expands to cater to our growing needs, it has become increasingly important for organizations to navigate this challenge and maintain a sustainable approach to fulfill these demands. To foster creativity and maximize efficiency, many organizations have begun to adopt a powerful development approach known as innersourcing.

Rooted in open-source and community, innersourcing leverages the collective intelligence and talents of an organization’s internal teams to promote innovation and efficiency.

This article will explore seven advantages of innersourcing to businesses, from accelerating innovation and knowledge sharing to fostering employee engagement and reducing duplication of effort. These benefits highlight why many companies are adopting this collaborative framework.


What is innersourcing

Innersourcing is a software development strategy that adopts open-source practices and principles when creating proprietary code. It is rapidly spreading throughout large organizations as it involves applying the collaborative and transparent processes commonly found in open-source projects to the internal development of software.

In large organizations, teams are often dispersed across various departments, continents, and time zones, making collaboration challenging as many members may never interact or exchange ideas. However, by implementing innersourcing approaches, teams can adopt the same workflow model, enabling engineers to contribute code to different teams and accelerate the addition of new features or resolving bugs and defects.

In an innersourcing environment, teams within an organization treat their internal software projects as open-source projects. This approach fosters a culture that favors pull requests over feature requests. By embracing innersourcing, teams encourage collaboration and distribute responsibility, leading to a more inclusive and decentralized development process.

When practicing innersourcing, tools like service catalogs help promote code reuse and facilitate access to shared components or access. A service catalog refers to a centralized repository or catalog of internally developed services, software components, APIs, or other resources made available for reuse and consumption by developers within an organization. In the context of innersourcing, service catalogs provide a convenient and standardized way for developers to discover, access, and incorporate reusable assets into their projects.

Several large organizations like PayPal, Bloomberg, and Walmart have been at the forefront of pioneering the adoption of innersourcing. These organizations have recognized the value of applying open-source principles internally to drive innovation, providing them with a unique competitive advantage.


Anatomy of an innersource project

According to GitHub, innersource projects mirror open-source projects and likely follow a similar structure. Just like most open source projects have teams of maintainers, contributors, and community members, we can split a typical innersource project into the following groups:

  • Maintainers: The maintainers are developers, product managers, and other key decision-makers responsible for overseeing the project’s development and ensuring its overall quality. They manage the day-to-day contributions by reviewing, approving, or rejecting contributions from contributors and managing the project’s roadmap.
  • Contributors: They actively participate in the project by submitting code, bug fixes, new features, etc. Contributors include but are not limited to developers, testers, data scientists, product managers, etc.


Benefits of innersourcing for our businesses

By fostering knowledge sharing and innovation, innersourcing brings many benefits to businesses. This section explores some of these compelling benefits, highlighting the impact it has on companies:


Improved Collaboration and Knowledge Sharing

The ownership culture can lead to the creation of knowledge silos which limits data accessibility, increases redundancies, and causes loss in cross-silo knowledge. Knowledge or data silos can be especially damaging when we need to mobilize resources from one department or team to another.

Conversely, innersourcing discourages knowledge silos by facilitating collaboration and knowledge sharing among individuals, teams, and departments. Innersourcing also promotes increased cross-team communication, better utilization of expertise, and the sharing of best practices across the organization.


Enhanced Innovation and Efficiency

Innesourcing allows businesses to tap into the collective intelligence of their workforce as it encourages code sharing and contributions from different teams, accelerating development and promoting innovation. It harnesses internal talents and fosters a culture of experimentation and iteration, leading to the faster development of new ideas.

Understanding that innersourcing fosters effective communication between teams allows employees to break down barriers to innovation, work together on projects, and leverage unique experiences and expertise. By centralizing resources and promoting cross-functional communication, innersourcing helps identify and eliminate redundant processes, systems, or data, increasing efficiency.


Increased Quality and Software

With innersourcing, we can implement collective code review and quality assurance to improve code quality early in the project’s lifecycle. Developers can leverage best practices and incorporate effective coding techniques by promoting peer reviews and collaboration.

As explained in this text by O’Reilly, increased code quality starts even before we create the pull request to contribute code, as the sheer thought that many people will review our code encourages us to write better code.


Accelerated Time-to-Market

The ownership culture encourages siloed decision-making and increases the time-to-market. Understanding that our products can require data or decision approval from different departments or teams, operating in a siloed environment can cause decision-making delays and slow the overall product development timeline.

Innersourcing encourages feedback loops and rapid iterations, enabling teams to iterate on product developments and make timely improvements quickly. With innersourcing allowing the teams to work in parallel, this reduces time spent on redundant tasks and will enable organizations to respond rapidly to customer and market demands.


Healthy team culture

By promoting open communication, collaboration, and shared ownership of projects innersourcing creates a space for developers to contribute to other projects giving them a sense of autonomy and recognition.

Innersourcing fosters employee engagement and personal growth, improving the Developer Experience and leading to better retainment and recruitment.


Cost Savings and Return on Investment (ROI)

With innersourcing providing team members access to resources in other teams and departments, it helps to reduce the duplication cost and efforts. Innersourcing also reduces the need for outsourcing expensive third-party solutions, reducing software purchases and licensing costs.

Additionally, the long-term benefits of innersourcing, which include faster time-to-market, increased software quality, improved efficiency, and reduced maintenance, contribute to an organization’s positive return on investment (ROI).


Scalability and Flexibility

A fixed capacity team can limit an organization’s ability to scale and be flexible due to having a predetermined and limited number of resources for the project’s execution. These limited resources can make it difficult for organizations to handle increased workloads as they need more flexibility to reallocate resources or adjust their capacity.

With innersourcing leveraging the collective knowledge and expertise of the internal teams, it is easier to scale projects and adapt to a customer’s and the market’s ever-changing needs.



Innersourcing is a powerful software development strategy that provides many benefits, from improved collaboration to increased innovation and efficiency. By incorporating the innersourcing culture, businesses can equip themselves with the unique competitive edge they need to adapt to the ever-changing demands of their companies.

Adopting innersourcing in your organization is one of the first steps toward a composable approach. By sharing knowledge and fostering collaboration between departments, developers can find and reuse components built by other teams in their products, installing the module instead of rebuilding it from scratch. Read this article to learn more about Composable Architecture.

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What is innersourcing
Anatomy of an innersource project
Benefits of innersourcing for our businesses