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Outsourcing vs Outstaffing: What Is The Difference And What To Choose?

March 25, 2022by admin

All you need to do is establish strong cooperation between in-house teams and the remote staffing talent. The main difference between these two models comes down to who is in control. With Outstaffing, the client manages the outstaffed development team directly and has responsibility for hitting all key development milestones and timelines. With Outsourcing, by contrast, the outsourcing vendor or agency is in charge of overseeing and managing all team activities, and is responsible for the final product that the outsourced team delivers. A company can delegate a whole project to a service provider or some particular functions,  it is also possible to work only with one vendor or entrust different tasks to several vendors at the same time.

The final cost of the project may go beyond the allocated budget depending on the engagement model chosen. Outsourcing software development projects to third-party companies or hiring remote developers may lead to a lack of control and communication between the in-house team and outsourced team members. This can result in misunderstandings, mistakes, and delays that can ultimately affect the project’s success. UVIK is an outstaffing company that’s been providing skilled developers for various projects for over a decade. Our specialists have worked in teams on solutions for legal, fintech, ecommerce, management, and other industries, so they quickly pick up the developing pace and maintain it.


With more than 8 years of experience in the market, Inoxoft’s aware of all the subtleties of developing high-quality products. Our dedicated team of developers are entirely committed to our client’s success. Oracle today announced new application development capabilities to how to hire a java developer enable developers to rapidly build and deploy applications on Oracle Cloud Infrastructure (OCI). Designed for cloud native and Java developers, the new capabilities will help developers build highly responsive and efficient cloud native applications while reducing costs. However, hiring an outsourcing company also saves time on setting up the process.

Now we’re ready to explain the difference between software development outsourcing vs staff augmentation in more detail. Managed services require the IT vendor to deliver a particular outcome (for example, a mobile app). In the second case, the IT vendor provides software engineers fully dedicated to your project. Bringing a business idea to life often requires SMEs, startups, or enterprises to hire an experienced team to deliver their projects successfully. But they may face a significant problem related to the tech talent shortage. For instance, the ManpowerGroup survey shows that 69% of U.S. employers struggle to find qualified staff.

Outsourcing vs Outstaffing in Software Development. Everything You Need to Know!

They may need to deliver long-term large projects or a set of projects bound together. In these cases, an offshore software development center (ODC) model might work better. When outsourcing software development projects, language and cultural barriers can be a challenge. Differences in communication styles, time zones, and cultural norms may impact project software developer outstaffing delivery timelines, quality, and efficacy. Companies can quickly scale up or down their development team size depending on project requirements, reducing the risk of overstaffing or understaffing and optimizing resource allocation. Additionally, businesses can easily adjust developer team size, skillsets, and expertise to meet changing project demands.

software developer outstaffing

The project manager will, in turn, be in touch with you to keep you updated on the project’s progress. Take note that, much as with the outsource team, the workers you outstaff are officially employed by a third-party. The company providing the services pays for salaries, taxes, compensation, insurance, software licenses and equipment. Apart from this main difference, outsourcing and outstaffing have other dissimilarities concerning pricing, management efforts, and payment which we structured in a table. So, working through an outstaffing model requires a better understanding of the tech side of the project on your side, as you are the one managing the outstaffed professionals. Now, as we’re done with the “hard part” of our discussion, let us move to the things that are more pleasant to read.

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The reason is that, within the outstaffing model, hired developers are fully managed by a client as they would be managed as a staff. However, the main difference between outsourcing and outstaffing is that outstaffing hires experts from other firms to work on the project under the control of the business owner. On the other hand, outsourcing passes the web development process to a third firm.

software developer outstaffing

When it comes to long-term projects, you may want to consider outstaffing or hiring a dedicated software development team. It is recommended for technology-focused businesses with well-defined processes and experienced management. There is no need to worry about data leakage, just make sure you make up a short but comprehensive NDA agreement. More control on your end means less responsibility on theirs and vice-versa. If your vendor has proven experience in software development and remote team management, either of the models should be on the table. The clients who value full control over the team’s activities and have the resources to manage developers themselves often prefer outstaffing.

An Insider’s Guide To Outsourcing And Outstaffing Software Development

As companies seek to develop new software products or improve existing ones, they often turn to outstaffing service providers to help them find skilled talent at a lower cost. With IT outstaffing services, organizations obtain faster time to market for their products. They do not need to search for experienced tech specialists who can deliver the project successfully. Since an outstaffing agency is responsible for offering top developers to fit specific project requirements, clients have more time to deal with their core operations. The significant advantage (or disadvantage) of software services outsourcing is that all the management lies on the shoulders of the outsourced development company you hire.

  • Waverley Software adjusts the development process to suit the client’s needs, and our Engineering Manager manages the team to deliver results according to the business objectives.
  • Typical vendors are vetting marketplaces that test developers and handle all legal matters.
  • While there is no published data yet, I’ve seen very few examples of outsourcers who have built and launched a commercially successful product on behalf of a client as a turnkey service.
  • In short, you get to manage and control the outstaffed teams as if they all worked at your company, but you aren’t responsible for the nasty bits that make actually employing folks a drag.
  • Client — a business that requests outsourcing or outstaffing services.
  • One of the main reasons why companies choose the offshore development service is to reduce cost on development.

One of the main reasons why companies choose the offshore development service is to reduce cost on development. This is especially relevant for countries with high development cost. A remote developer or a team can start working on the project almost right away. In fact, more communication is needed because most of the teams are working remotely. This will reduce the workload of in-house employees, giving them time to work on other company projects. A dedicated team model is probably the most misunderstood within outsourced development service.

Ready to reap the rewards of having a dev team custom built entirely around your needs?

Software development outstaffing refers to the process of hiring remote developers or teams of developers from another company to work on a specific project or projects. The outstaffing company provides these services based on the contract terms agreed upon by both parties. In other words, the outstaffing company acts as an extension of the client company’s team, providing the necessary skills and expertise to complete a project. When deciding whether to outsource vs. outstaff, many companies prefer the second option. All because IT outstaffing services provide excellent results due to full team dedication to projects. After all, more and more businesses have started hiring remote teams to deliver their projects.

software developer outstaffing

Besides the skill set required, they also have experience behind their backs, which is paramount in developing software. Alongside the peace of mind, lower costs, and full control, outstaffing has a few drawbacks to consider. These drawbacks won’t affect the process if you partner with a reliable and professional agency that doesn’t try to overcharge you for mediocre services. The hired professional becomes an employee of the outstaffing software development company. However, unlike outsourcing, outstaffing means that this remote employee becomes part of the client’s in-house development team. As mentioned above, in both outsourcing and outstaffing IT models, a company attracts a team or individual to work on a specific project/task.

Software Development Outsourcing Cost

But throughout years and projects, it proved its relevance and efficiency. In addition, Belarus Hi-Tech Park is one of the leaders in innovative IT clusters in Europe. It offers favorable tax conditions for businesses and supports industry growth. In case you need an expert overview of software development outsourcing, you are welcome to contact Qulix Systems. While outsourcing and offshoring have been buzz-words for the business community for decades, outstaffing (or hiring dedicated teams) sounds somewhat new, although quite understandable.