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Since neither communication nor project management efforts are offloaded to any outsourcing partner, the success factors for a project stay in-house. Depending on the contracting company’s culture and current needs, this could be a pro or a con. It may even be what the company looks for, and if this is the case, then it is a strong indicator that outstaffing may be the right choice over Outsourcing. Competition between tech companies is fiercer than ever. Every day more companies, from large-scale businesses to startups, resort to Outsourcing to expand their team capabilities.
Most of the time, outstaff specialists are located in other cities, countries, and even continents. IT outstaffing model is hiring foreign experts from another company full-time to work as a part of a client’s extended team. However, only some provide the reliability, talent, and professionalism that businesses value.
What is an Outstaffing Model?
Statista forecasted that the IT outsourcing revenue would hit US$395.00 billion in 2022. The report highlighted the attractiveness of software outsourcing and outstaffing models. Both provide businesses the flexibility to access a vast talent pool and fill missing skill gaps in their team. To keep the best managers and key technical talents in the company, you will have to prove your idea right and give arguments for why it is time to switch to the outstaffing model. Classic IT outstaffing refers to the usual type of outsourcing where remote programmers or a third-party agency are hired to perform individual tasks or develop entire projects. At the same time, the customer’s capabilities are limited by their own expertise and in-house team skills.
In this case, the client personally controls the scope of work and hires employees from another company. At the same time, the issues of wages are decided by the contractor and everything that deals with bonuses and equipment. Outstaffing is better for smaller companies that need software engineers, QAs, or other tech professionals to power their existing teams.
What Is a Dedicated Team?
The solid tech solution built via outsourcing model would be a contributing factor in boosting sales. R&D centers and remote agencies often have engineers that are between projects and can start working immediately. So if you have limited time, finding a remote development team that specializes in your area of interest will probably be quicker than hiring your own. Also, the what is outstaffing software development service provider is responsible for hiring, maintaining the team and, as mentioned, payroll. Outsourcing, it’s usually a project manager of the hired team who directs and controls the full scope of work. We build mobile and web apps for companies and enterprises from Western Europe and the USA, designing, developing and testing our products internally.
Leobit is a full-cycle web and mobile development company supporting outsourcing and outstaffing models for a different scope of involvement. We can assemble a dedicated team for you, subcontract our software engineers, or complete fixed-price tasks. Hence, finding a software engineer available for your project will take https://globalcloudteam.com/ minimum time. When you outsource development to remote teams, you rely on their expertise, skills, and work ethics, which, after you start working, may not match your expectations. One of the widespread concerns is that you will never know the developer’s level of expertise until you see the results of their work.
The Complete IT Outstaffing Guide: Model Definition, Benefits, Pros & Cons
In the case of freelancers, no one can guarantee you their expertise and fulfillment of all the requirements. Additionally, these companies are interested in your success, because it directly impacts their reputation and recognition. Thus, we will stick to the outstaffing approach and will use it as the main scenario for further guidance. Customers who choose a fixed price model, usually have clear requirements for the final product and therefore can completely outsource it. There’s no need to change the technical task or provide new conditions, which means the client does not have to manage the development team and control their work. Lower labor costs allow business owners and startups to hire skilled and reliable tech specialists.
We have successfully replicated 370+ projects and continue to prove our clients’ trust. Outstaffer deals with all issues related to the calculation, accrual, and payment of salaries and bonuses and taxes, and various fees. The customer only makes the payment that is stipulated by the contract. However, this will not create too many problems for you if the outsourcing fulfills your project tasks and your requirements. Please select your type of project request and submit the form, or contact us at for more information on Leobit’s services and technologies.
Communication barriers
To avoid such a situation, you must document tasks and internal processes, provide all team members with access to this information, and ensure smooth onboarding. If you’re looking for short-term projects and cheaper rates, outsourcing may be the right choice for your company. The customer company releases its employees, and the outstaffer company counts them as their staff. So, they are listed in the outstaffer company but continue to work in the customer company and perform their usual responsibilities. Under the contract of outstaffing, employees receive a monthly salary. All of those drawbacks can be eliminated by hiring a company that proved its reliability and quality by numerous projects and many years of experience.
- Therefore, Grand View Research, Inc. calculated that the cost of outsourcing and outside staffing would grow by 7.7 percent per year.
- The choice of one of the models largely depends on your business’s initial needs, goals, and capabilities.
- And, unlike the outsource cooperation model, a dedicated team is responsible for a certain part of the development process.
- Currently, we are focusing on healthcare, wellness, tourism, and entertainment industries, where we have a lot of successful cases.
- That is because outstaff team members can lose motivation since they do not obtain various benefits and bonuses typical for in-house teams.
- Besides, we are fluent in English and are comfortable working with Western clients.
- Developers from Eastern Europe are affordable, experienced, and known for delivering top-quality work.
You should prefer this option if you need to grow quickly, lack human resources for specific tasks, or have a limited budget. Transparent selection of the right outstaffed employees with a guarantee of their competence and professionalism. The customer has the opportunity to recruit a team of outstaffed experts based on their reputation, experience, and professional skills. This opportunity is especially significant for start-up companies. Finding and training skilled talent can be a great hassle and cost a lot of time and resources.
Step 2 – Search for IT outstaffing companies
But if you’ve never been in the shoes of a project manager, then it can be viewed as a disadvantage. First, companies realize the need for the services of a couple of developers, or maybe a whole team, for your software projects. In each case, you should only partner with the tech vendors that have expertise in developing solutions for your industry, and are familiar with its requirements for software products. When you choose software development outstaffing, you should also know about its flipsides. You also plan your work and decide when it’s time to add or remove certain specialists. This cooperation model helps you save money as you augment your team only when needed.
