In-house or Outsourced teams: How to choose

Should you build your own in-house team or use external sources? What is the best way to find new colleagues? It’s challenging to find talented tech specialists, especially if you are limited in time and money.

There are 3 options to choose from:

🏡In – house team (hire a local team of developers if you’re looking for long-term cooperation)

🐱‍💻Outsourced teams/Software house

💫Insourcing (it’s a mix of the in-house and outsource operating models )

Some business owners and managers say that hiring in-house developers is much better than getting help from outside. But others think differently. This question has left some people in a dilemma which path to choose, but there are so many things to consider before the final decision is made. The key is to determine how best to develop your product and what challenges you might be facing.

Well, the right decision depends on your ultimate goals and what’s right for your business. There are a number of challenges that businesses face – the right team, return of investments, communication, scaling. When considering hiring an in-house vs outsourced team, we should understand that each side has different ways of solving problems.

What is In-house software development?

In-house software development means using company resources to develop or implement software according to the company-specific requirements.

What is Outsourcing?

Basically, this means delegation. Outsourcing is an arrangement made by a business owner and managers to hire third-party software contractors to do the software related work instead of going in-house. 

The positive and negative attributes

Positive attributes of hiring In-house developers

  • in-house employees are likely  to invest more time and energy and often share the same vision with you
  • they are capable to see problems and offer solutions that outsourcing team may not notice because they know the business better
  • stronger alignment with your company’s interests, because they know that if the company prospers they will get their own share of this success
  • it’s much easier to take control of all activity, time management and existing code quality to ensure the new code meets your standards 
  • cultural fit, because people from in-house teams have already gone through all stages of interviews and company’s formation

Negative attributes of hiring In-house developers

  • time (it’s harder and it takes longer to find qualified experts)
  • hiring in-house developers means building up knowledge and better expertise, which can take significant efforts
  • lack of developers 

Positive attributes of hiring outsourced developers

  • when companies  are on the lookout for special skills or equipment that they don’t have in place
  • you can easily scale your development needs, capacity and the size of your team
  • very convenient if the company only requires limited or seasonal resources
  • hiring short-term help saves you from committing to annual salaries and benefits
  • time-saving, as you can skip onboarding, long recruiting process and everything associated with hiring new “forces”
  • up to date technologies – outsourcing developers or software houses usually stay updated on  the latest tech stack which maximises the value for the customers
  • for smaller businesses, outsourcing IT teams could be the only option

Negative attributes of hiring outsourced developers

  • demand for highly skilled experts has rapidly increased in recent years. They are usually very busy working on projects and “hard to get” which makes it harder to catch up with your deadlines.
  • communication can be difficult. You don’t know each other but you have to talk about very important aspects.
  • working with outsourcing teams might lead to the loss of knowledge. Knowledge is often maintained outside the organization and can be lost if there is no relationship within the team.
  • not control over the implementation
  • security protocols – not all foreign countries have the same security levels so there is a risk in terms of private data
  • picking the right outsourcing company/software house because the wrong choice means a loss of money, time and opportunities

So… is it better to go with in-house or going out? Well, it really depends on what you’re going after. For example, if you have a lot of product or design work that needs to be covered on a regular or daily basis, in-house staff makes sense. If you want to build a new brand, app, product or something that’s beyond your competencies, outsourced teams will help you perfectly. It can be hard to decide which approach is best for your company, but it is clear that there is no one size fits all solution when it comes to IT development.

For some companies, neither approach is a 100% match. This leads some companies to go for an Insourcing model that combines elements of outsourcing with an internal team. 

As you can see, you have many things to consider when hiring a software development team. Both options can work for your success, depending on your needs. And with the right team, your range of options expands. Whatever you choose, remember that what matters most is that your product gets delivered to the market. Follow the best path possible you think will make that a reality.

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