The IT field is usually one of the most important sectors in the economy of leading countries. We use modern technology on a daily basis and the more advanced technology becomes the wider is its range of implementation. When was the last time you spend all day without using any gadgets, without using a least one application on your smartphone or laptop? Even though programming has evolved significantly and there are modern tools for developers that make it easier for them to do their job, software development is still quite expensive.
The Popularity of Outsourcing
It goes without saying that outsourcing developers has become worldwide popular. This hiring model naturally emerged when companies started looking for a new way to save on operational expenses and ways to overcome the tech talent shortage. This model turned out to be more than efficient and eventually, companies learned how to use it successfully.
Outsourcing is being used not only for software development purposes but for accounting, customer support, human resources, marketing and more. The global market size for outsources services is $85 billion in 2018. As convenient as outsourcing may be, it’s still not good enough for some companies. Thus, by using this model for decades, they didn’t just improve it but also came up with a new, more convenient hiring model called outstaffing.
What Is Outstaffing?
Using outstaffing services for your software development project(s) means hiring a subcontractor to find, hire and manage employees (programmers, designers, etc.) for you but on your terms as per your agreement. This way, you can have whole teams of specialists to work on your project remotely and, to put it in simple words, your subcontractor is responsible for making things work for you. It’s much more safe and efficient than outsourcing and it’s still not nearly as expensive as building an in-house team.
One of the main differences between outsourcing and outstaffing is the way things work. Take a look at the picture below to get the idea.
The main reason to go with outstaffing is saving money. If you are to compare software developer salaries around the globe, you would be surprised how they differ depending on the location. Thus, an average software developer salary in the USA is around $70,509 per year while the same specialist from Ukraine ears approximately $41,000 per year. Taking this into account, you could get two developers instead of one if you are to outstaff to Ukraine. By the way, you don’t have to face recruitment issues, because your outstaffing company either has the right specialist already or find one as per your requirements.
Aside from saving money on salaries, you also save on taxes as your subcontractor is actually the one who hires employees and does accounting. With outstaffing, you can either have your own project manager or get one as a part of your remote team. In any case, you get to control the process and you always stay on top of things. Communication is also much more convenient and efficient and it’s a big advantage as without communication many issues may emerge.
Ultimate Outstaffing Advantages
Let’s try to sum up all the pros of outstaffing model. So, if you are to choose this solution you get to:
- Lower your development cost;
- Save on taxes;
- Easily scalable team;
- No tech talent shortage;
- Efficient project management and communication;
- Full control over your team;
- Lower operational expenses.
When outstaffing services are provided properly, it’s almost the same as having an in-house team. It is safe, efficient, saves you lots of money and you don’t have to deal with the majority of issues because your subcontractor does that for you. With outstaffing, you get the most efficient virtual team possible.