Today, we have countless ways to hire IT talent to suit varied development needs. Outsourcing has remained a popular option to access leading global developers and helps save costs and hiring time. However, entrepreneurs now have more choices as remote working becomes a norm post-COVID. The number of employees working remotely before the pandemic was 30%, compared to 48% now. Moreover, 83% of employees report they are more productive working from home. Businesses can take several paths to hire developers remotely in the present time. In this context, two hiring models are turning out to be valuable, which are IT staff augmentation and a dedicated development team. Both models have their set of pros and cons and are suitable for specific applications. Let’s explore the difference between the two hiring options and how you can pick the right one for your needs.

How to Extend Your Development Team with Outsourcing

Organizations can choose to outsource to reduce several barriers in the way of achieving business objectives. Outsourcing can enable businesses to focus on core operations and resolve a lack of expertise and in-house tech specialists. They can also look forward to improving service quality and fuel long-due transformational changes. Here are the most common outsourcing models to extend your team:

Independent Contractors

Businesses can hire an independent contractor like a freelancer to grow their teams. Freelancers can be good for short-term goals and filling talents gaps in your organization. However, freelancers are not always reliable and may leave your project mid-way. You may also need to spend countless hours combing through freelance platforms to find the right match. However, you have greater control over your project and workflows.

Full Project Outsourcing

Entrepreneurs may want to outsource the whole development to a partner. You will only need to define your project requirements, and your outsourced development department will build the final product. However, you may be free to check in from time to time to see how your product is coming along. This model of outsourcing offers a hands-off approach but gives you less control.

Managed Services

Managed services are ideal if you want to continue to enjoy a hands-off approach for your daily operations. Your managed service provider will take care of everything like deploying updates, managing SaaS, or maintaining your production environments. This option is usually expensive and most suitable for enterprises.

IT Staff Augmentation

Staff augmentation refers to hiring remote IT staff temporarily for a limited scope of work. Leading businesses use the staff augmentation model for hiring, which is also known as “gigs.” These developers work as an extension of your existing development team to tackle specific tasks or projects.

Dedicated Development Team

The dedicated development team is a complete outsourcing model and provides a permanent solution for talent acquisition. Outsourcing agencies provide entrepreneurs a team of reliable developers for software and app development. A dedicated team can include engineers and designers, QA specialists, and project managers, who can take responsibility for the project. Let’s compare the two most popular models of outsourcing software development: IT staff augmentation vs. Dedicated development team.

IT Staff Augmentation: pros and cons

Augmentation is a popular remote working method. Entrepreneurs can rely on augmentation when they have specific problems to solve or the need for additional technical expertise. Outsourcing firms can help entrepreneurs find top tech talents for augmentation and helping the existing teams.

Benefits of Staff Augmentation

Augmenting your staff with temporary talent can bring many benefits to the table. Let’s explore what you may expect from this outsourcing method:

Higher Flexibility

Businesses can scale their team easily with staff augmentation to meet increased workloads. When you need additional developers to complete the project and specific tasks, avoiding regular hiring and firing specialists is convenient. 

Quick Hiring

Traditional hiring is a long and time-consuming process. It takes 61 days on average to fill a tech role in high demand. You have to spend a few months searching for the right talent for your needs. Additionally, your recruits may quit in a few months putting your operations in jeopardy. Augmentation lets you access a network of vetted professionals ready to join your team. You don’t need to put our advertisements or wait for CVs to come in. In addition, your selection process also speeds up as all candidates are prescreened and fit your requirements. 

Low Costs

Staff augmentation doesn’t need you to provide hardware, tools, medical benefits, or bonuses to your developers. Your vendor will charge all additional perks while you pay affordable monthly rates for your developers’ time. 

Disadvantages of Staff Augmentation

Augmentation has its set of cons that you should consider before choosing your hiring model. The most common disadvantages include:

Not Suitable for Ongoing Projects

Augmentation doesn’t suit long-term projects that require project involvement and knowledge of your company and primary goals. You will get only temporary team members that don’t have a contextual understanding of your business.

Can Get Expensive

Relying on augmented staff for a long time can increase your costs. Most vendors use a time-and-materials billing method that adds up to your expenses over time.

Communication issues

You should never forget to repeat all the things that your in-house team knows to the augmented developers. Also, you should make sure they have access to your communication channels and have no issues with reaching out to the needed departments and specialists.

Dedicated Development Team: pros and cons

Generally, a dedicated team can work independently, and clients can enjoy a hands-free development process and concentrate on business tasks. However, entrepreneurs can always stay updated and in the loop about their projects.

Advantages of a Dedicated Development Team

Let’s check out the benefits of hiring a dedicated team:

Better Collaboration

A nearshore dedicated team usually has no time difference with your main office, so you can organize brainstorming and collaboration sessions when needed. Also, the developers are completely focused on your project and business, so they communicate with your managers a lot and stay updated with your business news.

Full Control

Businesses are in total control of the development process and workflows with a dedicated team. You can keep an eye on daily operations and step in anytime you need. Everything is in your hands, from people to tools to quality checks. Usually, the management of a team is provided with a client, so your CTO or Product Owner can organize daily standups, required meetings and manage all the processes.

Assured Quality

A dedicated team works full-time with your in-house experts to create quality products. You have complete control over the workflow and quality control processes. As a result, you can always create reliable products that woo your clients.

Scale Seamless

You can grow or reduce your team on-demand with this outsourcing model. Therefore, you are better prepared to meet changes in demand and keep costs under control.

Better Forecasting

Businesses need to pay a flat fee to vendors based on how many developers they hire. They don’t need to worry about daily expenses or pay for additional tools. As a result, you can easily predict your costs and better forecast your future cash flow.

Disadvantages of a Dedicated Development Team

Here are the typical cons that you might experience with a dedicated team:

Needs Commitment

Managing a dedicated team is not an easy task. You will need to invest time and resources to look after your processes and workflows. As a result, you should be ready for the workload and prepare yourself before hiring a dedicated team.

Not Suitable for Short-Term Projects

Hiring a dedicated team for short-term projects is like using tanks to kill mosquitoes. You will run up huge costs and waste resources unnecessarily. In addition, you won’t be able to derive total value from your vendor’s services.

How to Choose Between IT Staff Augmentation vs. Dedicated Development Team

As noted earlier, staff augmentation is ideal for specific tasks or short-term goals. Even before COVID-19, 72% of gig projects were offered by big enterprises and professional service businesses. Facebook, Uber, and several top names rely on augmented staff for tech projects. In Google’s case, temporary contractors make up over 50% of its total workforce. Well-established startups with in-house developers also favor augmentation to extend their development teams. They hire temporary developers to clear backlogs and finish a project quickly. These startups come with a strong tech leadership that knows the ins and outs of the development process. Businesses can also hire temporary staff for specific tasks, expertise, or niches. An augmented team can even help entrepreneurs expand their capabilities when they land a new project but lack in-house talent. As a result, you don’t have to reject offers just because you don’t have adequate resources in your organization. A dedicated team is ideal when you have a big project to work on. You can hire a team of dedicated developers to help you from ideation to delivery and maintenance. In addition, entrepreneurs can rely on their remote team for technical prowess and do not need to be tech experts. As a result, a dedicated development team is preferred to give shape to your product ideas.

Where to Hire Developers

We will now check out where and how you can hire developers for the outsourcing models we discussed above:

Independent Contractors

58% of businesses rely on contingent hires such as freelancers and contractors in 2021. It is a popular option to hire tech talent online. This option may be suitable for the staff augmentation model when you need an engineer or two to help your existing development department. You can search for developers on online freelance platforms like Upwork and Fiverr. Be sure to check out the portfolio and past projects of each developer to get the right fit. You should also consider their ratings and client reviews before making your choice.

Outsourcing to software development agencies

Several development firms are out there to help you outsource your project. You can look for a nearshore or offshore partner based on your budget and hiring needs. Just do a Google search to find the top development companies you can work with. This option is suitable for both staff augmentation and dedicated team models, as software development companies can offer a complete IT department for your project as well as a separate developer.

Marketplaces for hiring vetted software developers

When you hire independent contractors, it may take some time for vetting if the developer has the required skills and if they are reliable and collaborative. Also, independent developers tend to change their projects often, as it is the main privilege of a freelancer – not to be obliged with the work you are not interested in. Meanwhile, outsourcing agencies are more reliable, and their engineers are high-quality talent. But it can take some time to find a suitable development agency that can provide the required developers. When you are limited in the hiring period and need developers as soon as possible, and their quality is a top priority, there is an option of hiring with reliable marketplaces. As a rule, they offer high-quality and vetted engineers that work in different outsourcing agencies and are free for new projects. This way, you can save your time and find needed developers within a week.

Final Thoughts

IT outsourcing is now a more growing market than ever. Businesses can hire a remote team of developers and enjoy the same efficiency as an in-house team. On the other hand, IT staff augmentation can help entrepreneurs bridge talent gaps and extend their development capabilities. Consider your project nature and objectives to choose the right recruitment solution for your needs.