In such a situation, outstaffing is a preferable option as it allows you to quickly hire the required number of people and introduce them to your team in a matter of weeks. You do not need to delegate an entire project to an outside vendor, you just need several people to reinforce your in-house team and get the project going smoothly. Let’s say you already have five developers working on your project in-house, but the project is too big and too complex for just five people to handle. In that case, you find an outstaffing vendor who offers team extension services and can give you more developers fast. You can decide based on the needs of your business and the required technical component, and it doesn’t matter whether you have a mature business or a startup. If your company is not technically oriented and there are no in-house experts who could lead the development team, outsourcing is more suitable for you.

This model allows for better communication and fewer legal and cultural issues. You also get faster turnaround times and increased project control onshore. It is usually more expensive than other models due to higher labor costs. How about having a talk with a leading provider of software development outsourcing and oustaffing? Their expertise helps them deliver the project smartly, swiftly, and cost-efficiently.

  1. Outsourcing literally means a company gives their idea to a remote development team — and they deliver a final digital product.
  2. The client contracts with an outsourcing company to do a process in outsourcing.
  3. There are several ways to extend the capabilities of your IT staff.
  4. She has an intense passion for content crafting and calls herself a ‘wordsmith’.
  5. Sales costs, office space, recruiting and bench-time contribute to overhead.

However, during the building phase, you won’t have much access to the code. This is because the software outsourcing company needs to secure it against possible data theft. Normally you will be presented with demos of what has been done during a certain timeframe.

Places to Find Offshore 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. However, software outsourcing will require additional preparation.

Outsourcing & Outstaffing Development Models Comparison

Preethi Saro Philip is a Post Graduate Research Degree holder in Economics with more than 10 years of experience in writing, editing, research and teaching. She has an intense passion for content crafting and calls herself a ‘wordsmith’. She enjoys writing on wide-ranging topics including business, technology, health & lifestyle, education, environment etc. AS per Statista, most revenue will be generated in the United States (US$313.70bn in 2022). As per a McKinsey report, there is a threat to the competitiveness of Europe due to the relative lack of big software and software-enabled companies.

Outsourcing vs. Outstaffing: Differences, Pros and Cons

Sometimes, when deciding between outsource or outstaff, outsourcing will be the clear winner. Outsourcing will be the right option if you have occasional bursts of IT needs, whether to build a new app or shepherd the company through major software outsourcing and outstaffing transitions. Under this model, you pay for your outstaff team member’s salary, buy their computer equipment, pay bonuses and overtime, and cost benefits. You don’t do this directly, as the outstaff team member is still an employee of your IT outstaffing provider. 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., a serial entrepreneur, and is a dedicated promoter of remote work and remote teams. Vasily Voropaev is a founder and CEO at, a serial entrepreneur, and is a dedicated promoter of remote work and remote teams. We have over 200 professionals proficient in .NET, Ruby, Angular, iOS, Android, React, Blockchain, Metaverse, and a wide range of other Microsoft, Web, and Mobile technologies. Therefore, finding an available app developer for your project will take minimal time.

Outsourcing vs Outstaffing: How to Choose It Right?

For companies prioritizing cost savings, outsourcing is definitely the best way to optimize expenses. This model will also be a suitable choice if you have specific projects or tasks that can be completed without continuous control. In 2023, global remote staffing spending reached $731 billion, with 92% of G2000 companies relying on outsourcing software development. Sparked by the pandemic era, the role of remote hiring has become critical for businesses striving to thrive in fluctuating landscapes.

The level of your engagement in the project can be negotiated with the vendor and depend on the type of contact. So, if you have an idea for a project but don’t have the right people, managerial experience, and domain expertise for the job in-house, outsourcing can be your best choice. The choice between outstaffing and outsourcing is a crucial decision for any organization. Therefore, when deciding, it is essential to consider all relevant factors, such as the level of control over the project, the cost, the expertise required and the cultural fit. By carefully weighing the pros and cons of each model, you can determine which would be the most effective and suitable for your situation. Like any business strategy, there are key differences between software outsourcing and outstaffing.

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. With outsourcing, team management happens on the side of the offshore web development agency. Companies are forced software outsourcing and outstaffing to make that choice every time they need to build projects or implement a new feature. Waverley Software provides accounting and legal support to the team members; our HR management system manages team member’s PTO in a way that doesn’t impede the product development.

They select from already vetted professional developers available in outstaffing company’s talent pool. By partnering with such a company, your business gets a team or worker to perform a specific task/project. 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.

Start a Project

Once you’ve settled on a few possible providers, contact them and set up an initial meeting (or virtual call) to discuss the project further. Make sure to look at their cost to get value for your investment. In addition, if you are getting a dedicated software development team, look for one with similar values and goals. Your shared values ensure a successful and collaborative partnership.

Then they think of how much they’ll have to spend hiring quality in-house developers, which is probably not the best choice. Your choice of pricing model will depend on the specifics of your project, and there is no right or wrong answer. You need to negotiate the pricing with the vendor and select a model that suits your particular project.

This is the reason why outsourcing companies pay so much attention to figuring out the project goals and conducting a discovery phase. Hiring a software outsourcing company will fully evaluate your demands, wishes, and budget and will make your project idea a reality. Thus when hiring an outstaff agency, it is worth drawing attention to the working environment in these agencies. The more benefits that agencies provide, the more chances your developer will not leave the company (and your projects with it).

We will reveal the aspects of these concepts and also tell you how to apply them in practice without any risk. We’ll rarely send you articles to keep you updated with the latest software development trends. More than a third of small businesses surveyed in Clutch’s 2019 review outsource a business process and more than half have plans to outsource in the future. Outsourcing allows businesses to scale up as needed without having to hire additional employees or make major investments in equipment or building space.

Workers receive payment through an outstaffing agency, who solves all workforce-related issues as well. It can be said that offshore developers literally become remote internal developers for the client company during the entire period of cooperation with offshore agencies. Finding the right software outsourcing partner can take time and effort. There are numerous providers, each with its strengths and weaknesses.