Outstaffing enables businesses to access global talent pools, which can be particularly beneficial for companies looking to expand into new markets. It can tap into a diverse range of skills and expertise from around the world and gain a competitive advantage in its industry.
This development model has specific advantages that create great opportunities to receive more projects and profit. It also helps optimize recruitment and administrative costs.
Outstaffing development model is becoming increasingly popular, especially in industries like investment, cryptocurrencies, fintech, insurance, online education and e-commerce.
The top reasons why companies choose outstaffing for software development
Technology companies choose outstaffing because it's a modern solution to address business requirements such as rapidly expanding the team, tackling various other challenges and resolving specific technical tasks. There are a few main reasons to outstaff your workforce.
You need specialized skills for a separate task but lack relevant knowledge in-house
Outstaffing can be a good option if your company requires specific expertise or skills that are not available in-house. For example, when you need to develop a mobile or web application with a tech stack, you have yet to work with before.
Your manager can oversee the external team's execution with expertise
The experienced project manager can work with the outstaffed engineers to integrate them into the development process and align their work with the company's objectives. A PM ensures the outstaffed team adheres to the company's quality standards and best practices. This approach ensures the project is completed on time, within budget, meets the company's requirements and quality standards.
A clear process for remote team's infrastructure and development environment access
The company should ensure that the outstaffed team adheres to its security policies and procedures to protect confidential data and intellectual property. The company should also ensure that the outstaffed team has access only to the resources they need to perform their job and that their access is monitored and controlled.
Employees understand current tasks and have the necessary tools to set, perform and monitor them
Outstaffing requires a well-established process for setting, performing and monitoring tasks. If your company has the necessary tools and processes for managing tasks, then outstaffing can be a good option.
Your company and employees embrace the process of forming relationships with outstaffed employees
Communication needs to be more formal and structured, with regular check-ins and progress reports. The outstaffed team may also be in a different time zone, which could require scheduling flexibility. The company and process participants should also be prepared to provide clear instructions, feedback to the outstaffed team and be open to hearing their ideas and suggestions.
Why is outstaffing the best solution for software product development
This development model has several advantages for companies that use it in different projects. Increasing and decreasing the number of outstaffed developers is much easier in this case. Here are the main benefits of outstaffing.
Access to specialized skills and expertise
Outstaffing allows companies to gain a pool of highly skilled and experienced software developers with expertise in various technologies and programming languages. This development model allows companies to tap into specialized skills and expertise that may only be available in some places. It also enables tech businesses to take on more complex software development projects.
If a company wants to receive a cost-effective solution, it would be better to choose outstaffing. The service provider covers all costs, including salaries, benefits, equipment and office space. Additionally, outstaffing enables companies to avoid the costs associated with recruiting, hiring and training new employees.
Outstaffing can help companies save time on the recruitment and hiring process, which can be a lengthy and resource-intensive process. By leveraging an outstaffing provider, companies can quickly access skilled professionals and start working on their projects immediately.
Companies gain the flexibility to quickly scale their software development teams up or down as needed without the time and expense of recruiting and training new staff. Outstaffing enables companies to respond to changing business needs and project requirements promptly and efficiently.
Greater control and transparency
With outstaffing, the client company has more control over the project and the work done by the outstaffed team members. This approach provides greater transparency and accountability, as a business can monitor progress and ensure the work is done satisfactorily.
Outstaffing can help companies accelerate their software development projects, as they can quickly access the talent they need to avoid delays caused by recruiting and training new staff. This model can help companies get their products to market faster, giving them a competitive advantage.
Challenges and how to address them
Despite the advantages of outstaffing, it also presents several challenges that companies should consider and know how to fix.
This challenge can manifest in different ways, such as language barriers, work habits and attitudes toward hierarchy and authority. For example, a team from a hierarchical culture may need help adapting to a more flat organizational structure, which can cause friction and misunderstandings.
To address this challenge, companies can provide cross-cultural training and ensure clear communication, expectations set from the outset. Establishing common ground and building relationships with outstaffed employees is essential to build trust and understanding.
Lack of control
Another challenge of outstaffing is the potential need for more control over the outstaffing team. When a company chooses this development model, it may have different control over its work processes and outputs than with an in-house team. This can lead to missed deadlines, poor-quality work and misaligned priorities.
To address this challenge, companies can establish clear expectations and guidelines for the outstaffed team. It can include setting specific goals and metrics, defining communication protocols and outlining expectations for performance and deliverables. Regular check-ins and progress updates also help ensure the team is on track and aligned with the company's objectives.
When working with external teams, protecting sensitive company data and intellectual property can be challenging. This is particularly important in finance, healthcare, or government industries, where data security and compliance are critical.
To address this challenge, companies can take several measures:
• They can establish strict security protocols and requirements for external teams, including secure networks, encryption and two-factor authentication.
• They can provide regular training and education to external teams on data security best practices and company policies.
• Companies can implement tools such as data loss prevention software or remote access solutions to monitor and control data access and usage by outstaffed employees.
During working with an outstaffed team, communication can become more difficult due to language barriers, time zone differences and cultural differences. Misunderstandings and delays can occur if there is a lack of effective communication.
To address this challenge, it's essential to establish clear communication channels and protocols from the beginning of the project. It can include regular video calls or meetings, instant messaging and email communication. It’s also important to establish expectations for response times and agree on communication protocols, such as which communication tools or platforms to use.
How much does outstaffing software development cost
The cost of outstaffing software development can vary widely depending on several factors, such as the project's complexity, the developers' experience level, the project timeline and others.
The complexity of a project is one of the most significant factors that can impact the cost of software outstaffing development. The more complex the project, the more time and resources are required. A project with multiple features, intricate functionality and integrations will need more skilled and experienced developers, increasing the development cost.
Skill and experience level of developers
It's crucial to strike a balance between the developers' experience level and the project budget. Hence, a company should analyze market rates in different regions and countries. Such an approach will save funds and time.
Location and currency
It can also affect the development cost. Developers in certain regions may demand higher rates than others based on their location's cost of living and the availability of skilled developers. Additionally, currency exchange rates can also impact the development cost, as the value of currencies can fluctuate over time.
7 steps of how to start using the outstaffing development model
In addition to the benefits of outstaffing, it's essential to understand what stages this model consists of.
Step 1. Define your development goals
Before considering outstaffing as a development model, it's crucial to determine your development goals. This stage includes understanding your business objectives and project requirements. You need to determine the size of the project and the skills you need.
Step 2. Analyze your needs
Here you need to evaluate the technical skills, experience and other qualifications your project requires. Identify the specific roles and responsibilities required and assess the expertise of the potential team members.
Step 3. Define budget and time expectations
Then determine the amount of money you can allocate for the project and create a detailed timeline with specific milestones. A clear understanding of these two components will help you ensure your project stays on track.
Step 4. Research countries for outstaffing
Consider factors such as language proficiency, cultural fit, cost of living and the quality of the IT industry. You need to find a country with a large pool of qualified developers and a favorable business environment.
Step 5. Choose your future software outstaffing partner
Choosing the right outstaffing partner is critical to the success of your project. You should evaluate their experience, expertise, reputation and communication skills.
Step 6. Sign a contract
Once you have selected your outstaffing partner, you should sign a contract. It should include the scope of work, the timeline, the budget and the expectations for communication and reporting. A clear contract will help you avoid misunderstandings and ensure that both parties are on the same page.
Step 7. Begin the development process
Once you have signed the contract, you can start the development process. Establish effective communication and collaboration processes, set clear goals and expectations and monitor progress regularly to ensure successful project completion. You should ensure that the outstaffing team is fully integrated into your development process and can work seamlessly with your in-house team.
Outstaffing can be an effective development model for companies looking to build their teams without incurring the costs and complexities of hiring full-time employees. It offers several advantages, such as cost savings, access to a larger pool of skilled talent and the ability to scale quickly.
Following the seven steps outlined in this article, you can successfully implement the outstaffing development model and achieve your business objectives.
We will gladly become your partner if you think about outstaffing software development. Our experienced engineers have solid expertise in a wide range of industries. They also have great experience in creating projects with all advantages of outstaffing.