Choosing The Software Outsourcing Model That’s Best For Your Business

Thanh Pham is the CEO of Saigon Technology, a top offshore software development company in Vietnam. 

During the Covid-19 pandemic, facing the risk of having to suspend operations or close down, companies have tried to find the fastest and most effective ways to continue to serve their customers while still ensuring health and safety. IT solutions have exploded as businesses look for ways to remotely interact with customers. Internal business processes and communication methods have also had to evolve because of the pandemic.

Software Outsourcing In A Socially Distanced World

We now live under a “new normal” with the changes brought by the pandemic, and the IT industry is no exception. People tend to maintain distance from each other. We also can’t move from country to country, or continent to continent, as before, so the onsite form of software outsourcing isn’t as feasible as it once was.

However, if you want to push your IT solutions forward, you need the support of the right software experts. But it may not be possible to hire more staff for a recovering business. Even if you have the financial resources available, you may not have the space to safely distance employees in the office.

This is where software outsourcing can help. This is an agreement between a business and the outsourcing service provider to carry out a software project. Software outsourcing is an ideal growth strategy capable of accelerating the ongoing global digital transformation while cutting operating costs and ensuring product output.

In this industry, the top three software outsourcing methods I’ve encountered include IT staffing agencies, dedicated teams and the time-and-material model. Let’s take a look at each method and its applications.

The Three Most Popular Software Outsourcing Models

1. IT Staffing Agencies

IT staffing agencies have numerous suitable candidates that match the talent search requirements of businesses, whether it’s recruiting a single specialist or a complete IT team for a long-term project. Talent from IT staffing agencies are usually ready to join a project right away, as they typically have extensive experience in the areas you select in your search. Staffing companies such as these have recruiters that spend a significant amount of time and effort in the screening, interviewing and hiring process, and then categorize talent to easily find experts that match your project. These services are becoming increasingly popular and suitable for almost all types of businesses.

An IT staffing agency may be the best choice for your business if:

You need short-term human resources for a temporary software project.

You’re not able or don’t have the need to hire full-time, permanent employees.

You don’t require in-depth knowledge of your company for your project.

2. Dedicated Teams

The dedicated team model includes a transparent, long-term strategic agreement between a business customer and an IT service and solution provider. With this type of human resource service, the client can choose the right personnel for the business from available candidates that work for the service company.

This model has a fairly simple pricing system, in which the customer pays a monthly service fee. This fee is determined by the management costs, team members’ salaries, number of team members and other maintenance costs of the service provider.

A dedicated team may be the best choice for your business if:

You have a longer timeline to find candidates for the available roles.

You have a long-term project.

You need cohesion among the team members.

The roles you have available aren’t short-term or contract-based.

You have the budget and ability to pay for long-term staffing needs.

3. Time-And-Material Model

With the time-and-material model, clients compensate professionals based on the number of hours they work to complete a particular project. The time-and-material model is mainly used when businesses need human resources for long-term projects with an undecided scope, requiring flexibility. The transparency in pricing between developers and businesses is a significant advantage of this model. 

The time-and-material model may be the best choice for your business if:

Price transparency is considered a top priority.

You’re unsure if you’ll need staff for a temporary or long-term role.

Flexibility is paramount.

You want to use personnel from different recruitment service providers.

Other Advantages Of Software Outsourcing

The advantages of these software outsourcing models include improving development capacity and output, reducing personnel costs and speeding up product completion to serve end users as quickly as possible. But a major benefit relevant to today’s socially distanced world of all three models is that you can use talent that doesn’t necessarily need office space — many of these experts can now work with you remotely.

Although most businesses would benefit from these services, they can particularly help companies that might be working to get back on solid financial ground or ones that don’t have the ability to space employees apart. Depending on the specific needs and characteristics of the project, you can consider the options and choose a suitable form of software outsourcing.


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