Unlike outstaffing, a software outsourcing company manages the developers in the hired dedicated team. And, unlike the outsource cooperation model, a dedicated team is responsible for a certain part of the development process. Outstaffing is when a company hires remote IT professionals or teams from an external service provider to work on specific projects or tasks. Instead of hiring new employees or expanding their in-house IT department, companies can tap into the expertise and skills of external IT specialists on a flexible basis.

The benefit is that you always know the exact amount you will pay monthly, and you’re spared the management hassles of administrating your outstaff team. Both methods suggest you use the workforce outside the company to do the job. Outstaffing means a client directs and controls development by their own efforts. Most often, outsourcing means that your contractor will do the whole scope of work – not just a task or two. If it’s an app, they will deal with everything – from technical requirements to final checks and maintenance.

Start a Project

Outsourcing and Outstaffing IT models have evolved to serve companies from all over the world. Recognizing the differences between outsourcing and outstaffing models can help you reveal the best approach for your projects. If your company is not very much technology-focused and you don’t have in-house professionals to oversee the work of the development team, then outsourcing can be a better idea for you. On the other hand, if you have well-defined processes and a proper management to handle the remote team, then you are welcome to stick with outstaffing. However, each case is unique, and it’s always a good choice to consult with the experts first. As we already said, both outsourcing and outstaffing have their pros and cons.

As a result, you’ll have team members familiar with the client’s IT infrastructure and the needed specialists who will jump into the development process right away. You can augment your tech team by hiring a developer from an outstaffing agency and have a full team assembled to start your project. The outsourcing agency assigns a dedicated project manager that acts as an intermediary between the client and the developer.

No Actual Communication is Required

At the same time, the IT services provider acts as the official employer that pays benefits, bonuses, equipment, holiday pay, and employer taxes. If you made your decision on what model to choose, feel free to contact Riseapps! We’ll do our best to come up with the most sensible outsourcing or outstaffing solution for you, offering high-quality services at a reasonable price. As mentioned, Riseapps provides both – outsourcing and outstaffing services. Often, owners of budding startups have neither thorough plans for the future nor the capacity to employ external contractors for a full-time job.

outstaffing vs outsourcing

Outsourcing and outstaffing are well-known terms among IT recruiters and professionals in the world of tech. During the pandemic, both of these industries are experiencing unprecedented growth. At Devlane, we are experts in both Outsourcing and Outstaffing models. Reach us out here, and we can help your company choose the model that best suits your needs. However, this comes with a heavy load of managerial tasks for the client, most of them being critical factors for a project’s success.

Outsourcing vs. Outstaffing: Understanding the Differences

Hiring from Asia and India offers lower cost for outsourcing software development. In fact, the client is responsible for keeping track of assigned tasks, managing the progress, communicating with a developer or a team of developers, and accounting. According to the National Outsourcing Association survey, cost savings (35%) and improving customers’ experience (23%) are the top reasons why companies choose to outsource. Companies are forced to make that choice every time they need to build projects or implement a new feature.

They handle all the management of their team resources, with a client liaison that helps work with you on a business plan. Increasingly, companies are turning to outside vendors both at home and abroad. Let’s briefly sum up the comparison of outsourcing and outstaffing models. In the case of outsourcing, it’s usually a project manager of the hired team (outside of your company) who directs and controls the full scope of work. Outsourcing and outstaffing are the practices largely widespread and approved. They can speed up the development process, save your costs and allow you to utilize the precious experience of IT experts working from anywhere in the world.

Company’s reputation

The solid tech solution built via outsourcing model would be a contributing factor in boosting sales. Clients often choose outstaffing when they already have their tech team but lack some experts, so a task can’t be handled internally. We build mobile and web apps for companies and enterprises from Western Europe and the USA, designing, developing and testing our products internally. Currently, we are focusing on healthcare, wellness, tourism, and entertainment industries, where we have a lot of successful cases. Recently, most startups have shown a clear tendency to hire developers (and specialists in general) externally.

  • If you outsource some tasks that aren’t the core of your business, you may have more time and labor to concentrate on core initiatives.
  • In Outstaffing, the client will have to manage hired employees in all matters related to the project development.
  • There is a prevalent misperception that outsourced IT teams lack the necessary familiarity with your IT infrastructure as compared to in-house professionals.
  • Find out if they have developers armed with the skills that your team needs.
  • Using an outside vendor saves not only benefits and overhead on employees but base salaries for IT workers when you combine outsourcing with offshoring to countries with a low cost of living.
  • After reviewing developer profiles, you select the ones that interest you.

Compare them and choose those that provide consistently good services. Some technological companies prioritize control and data privacy. While outsourcing vendors are bound by NDAs, these companies prefer to set up an outstaffing vs outsourcing in-house IT team and hire outstaffed developers. This allows the internal team to work on the highly-sensitive part of the project. However, outsourcing is a feasible option if technology isn’t your core business.

Introduction to Outsourcing Market Statistics

On the other hand, large and public companies tend to position themselves as in IT outsourcing, but only in the Product Development Services and Managed services areas. As time goes on even small companies reject “outsourcing” positioning using “custom software development” instead. Nowadays, the global outsourcing market has grown to $92.5 billion and continues to grow.

outstaffing vs outsourcing

For example, you use tools like Slack, and Asana to plan, discuss and keep track of projects. Outstaffing ensures that your business has stable long-term support, while outsourcing is ideal for a one-time project. Both outsourcing and outstaffing are viable solutions for you, depending on your business requirements. Here’s how to make a choice facing the outstaffing vs outsourcing dilemma.

Ready to scale your business using outstaffing services?

But if you’ve never been in the shoes of a project manager, then it can be viewed as a disadvantage. A dedicated team model is probably the most misunderstood within outsourced development service. Usually, outstaffing is best for those customers who have a solid in-house team and want to find an expert in a certain area or save some money on hiring staff.

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