In-House Development vs Outsourcing: How to Deal With the Staffing Dilemma

Published on May 15, 2018
In-House Development vs Outsourcing: How to Deal With the Staffing Dilemma

Organizations across the globe adopt IT infrastructures by leaps and bounds. They demand top-level software engineers that will help them cope with the challenges of digital transformation. But which cooperation model should companies choose? Hire in-house teams or delegate all the IT work to a software vendor?

Both variants have benefits and weaknesses, but the recent Deloitte report shows that in today’s business world, software outsourcing dominates. Since 72% of enterprises prefer to delegate their software-related tasks, hiring talents in-house is no longer a number one option.

So, in-house development vs outsourcing: what makes the most sense business-wise? If you’re facing the staffing dilemma, here are some of the pros and cons of each cooperation model to help you make the choice that’s right for your case.

The Pros and Cons of In-House Tech Teams

The decision comes down to the project scope. Short-term assignments usually require tech talents for a few months only. But for the long-term type of work, you may need IT specialists on board for years. In this case, in-house development comes in handy.

Assemble Your Dream Team

Building up an in-house tech team means rigorous recruitment. By selecting people with the same values and a similar problem-solving attitude, you create a perfect working environment that can help propel the project’s progress. Being a part of your company, employees feel more responsibility for its future growth, since the organization’s rise defines their success as well.

Keep Everyone on the Same Page

In-house staff are not only tuned to meet the company’s specific needs but are always on the ball. This allows them to keep up with the workloads quickly and wisely. Plus, regular meetings and face-to-face discussions make communication between departments quicker and more transparent.

Manage Emergencies Faster

Some tech solutions require immediate reactions. For companies that aim to amp up their business, a full-time IT guru is invaluable in cases of emergency like a security breach or a website down. While outsourced experts usually stick to the tasks that were previously agreed on, in-house specialists can devote all their attention to a rising problem, regardless of the predefined scope of their actions.

But Mind your Budget

Onboarding top-level specialists can be tough. And expensive. So, get ready to fork out. In-house development will cost you lots of your company’s resources, including spendings on hiring and training talents, workspace arrangements and social benefits. Add salaries, taxes and annual vacations you have to cover, and the in-house team will cost you a small fortune.

Interviewing candidates and negotiating also take much time, and if an employee dodges, you’ll have to start over. And it’s not only the precious time you lose but the money spent on recruiters’ salaries. Even if large companies can afford these expenses, the majority of startups won’t stand. Can outsourcing help solve this issue?

Outsourcing Pros and Cons

Such world-known giants as Skype, Slack, Alibaba and Amazon fill their IT gaps by outsourcing software development. Their success and a bunch of outsourcing perks prove this cooperation model is worth a shot.

Invest in Flexibility and Specialized Expertise

Outsourcing allows improving the operational flexibility of an organization and scale teams on demand. While searching for a perfect in-house match can take up to several weeks, a software vendor will bring in contractors with a very specific skill set quickly.

By having access to a massive pool of talents, IT outsourcing vendors can engage specific professionals based on particular requirements. This scenario is ideal for small assignments: once the task is finished, you just stop cooperating with the specialists, no hard feelings. This approach is more convenient than hiring a full-time employee with a general set of IT skills that will hardly handle non-standard tasks.

Run Your Business Cost-Effectively

A strategic focus on outsourcing can help you save considerable business investments. By outsourcing software development, enterprises can cut off overhead costs like office supplies or hardware. No need to create working conditions, compensate sick leaves or pay taxes for the employees — a software vendor handles these issues, so you don’t have to.

If you compare budgets required to maintain the entire software development team and outsource IT services, you’ll notice how contracting offshore teams helps you cut on the investments you make into the office infrastructure. This is extremely valuable for up-and-coming startups on tight budgets.

What About Outsourcing Downsides?

The team you bring in might not be as involved in your business as in-house specialists would. The lack of internal communication and not understanding your company’s internal processes can harm the further workflow.

Don’t forget that when partnering with an external agency, you will lose control over some of your company’s functions. However, this will also allow you to focus on the more critical tasks like business development or engaging new clients.

Merging the Pros of Each Staffing Method

Now that you know the advantages and disadvantages of each cooperation model, it’s easier to choose which approach fits your business strategy. For the majority of businesses, the best variant is the hybrid one — mixing the benefits of in-house development and outsourcing. In this case, we suggest you turn to cross-border teams.

Cross-border collaboration allows combining both your in-house experts and external specialists into a single, close-knit team. By partnering with a reliable vendor that will extend your team with matching talents, you can equip your enterprise with the right resources times quicker. Plus, since extended teams are fully dedicated, you can stay in control of the development process without the hassle of recruitment.

The core task of your trusted partner is to find and retain top-class professionals as well as provide all supporting services and infrastructure. Take Pwrteams: our approach to cross-border teams is aimed at quick integration with the client’s processes. We adapt to your environment and catch up with the existing workflow to make in-house specialists cooperate with contractors as a joint unit.

With cross-border teams, you save time and budget on hiring employees while keeping the control over critical operational activities. It’s a proven way to get the best results out of both cooperation methods, as well as eliminate their worst pitfalls. Contact Pwrteams for more!


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