It's clear that outsourcing is on the rise. But, if there is one area where it's most popular, it would be IT. 72% of outsourced tasks are IT related. A likely reason is that many IT tasks do not require a new department or new employees. However, they are still essential to the maintenance of any company.
This article will cover what it means to have an outsourced dedicated development team who work on IT-related tasks. It will also cover how it could benefit your business and why it might not.
A dedicated development team is a team of developers that a company uses long-term. Technically, they are not employees; they are closer to third-party contractors. However, their skills are used by the company for an extended period to enable itself to meet specific goals or quotas or for tasks its regular employees are incapable of.
There are similarities between a dedicated development team and an in-house team. For example, both work for a single company and are expected to remain there. However, a dedicated team is charged independently; they do not require admin fees, HR resources, taxation, or social benefits (such as healthcare plans).
With a dedicated development team, the team is hired for the period they are required to work. This may be six months, two years, one year, or however long they are needed. People on the dedicated development team will be required to work full-time for the company during the time they are working on the project or goal.
One alternative is the fixed price, in which the price for a project is agreed upon in advance and paid regardless of how long it takes. Another alternative is Time & Effort, in which payment is hourly.
If a company has a large task, which consists of multiple smaller tasks, it can be challenging for employees to take on the new task while also going about their regular jobs. Some tasks are so large they need a team of people to work on them full-time without being distracted by other assignments or duties.
For example, suppose you wish to run a new app. In that case, it could be wise to hire dedicated android developers instead of asking already busy and untrained-in-app software staff.
When you hire a dedicated team, you can fully manage the project and the team running it. You will own all the data and software created during the project.
Because you are their customer, not their boss, everything they create during the project should belong to you.
Hiring a team for a long-term project is significantly cheaper than hiring new staff. It reduces HR costs and decimates overheads, and allows you to hire people in countries where skilled work is more affordable.
Unlike fixed price or time and effort projects, a dedicated team can focus only on your project, which allows them to dedicate themselves fully to meeting your goal.
Many dedicated teams will allow their customers (companies) to use time tracking and task management, so you can see how they're getting on with a particular goal. This lets the team and customer/company know everyone is on the same page.
Websites such as Slack also allow for better team communication.
Since dedicated teams are not technically employees but businesses that help other companies, they will come to a project with previous experience and relevant qualifications. Because they will be more qualified than the organization they're currently working for, they can offer helpful advice on better meeting a goal.
The team should also be great at delegating tasks since they should be used to working together.
The client and the team often work closely together. With daily communication, brainstorming, and planning meetings, faster development is almost guaranteed.
A dedicated team is unnecessary if a project will not last longer than a few weeks. In this scenario, it will be more efficient to pay for either the whole project as an agreed sum or pay the team hourly.
There are some projects for which a long-term dedicated development team might not work. For example, an app that needs constant updating might work better if a full-time in-house team runs it.
If you're 100% certain of the goals and are confident they will not change, paying for the project as an agreed sum could be better. This option sacrifices flexibility for affordability, but that could work better for some projects.
Although hiring people from overseas can be cheaper, they might not be available when you need them. For example, when it's 10 am in New York, it will be 8:30 pm in India, when many of them have finished work for the day.
Since this team is working full-time for a limited but long-term period, some may have concerns about not giving them the same benefits as regular employees. It's like having all the benefits of a group of employees with none of the responsibilities.
A dedicated development team is an outsourced team of developers who work full-time for a limited by long-term period to help a specific customer (a company) achieve a goal or set of goals. It can be cheaper, more flexible, and more efficient than some alternatives. But, it's not a one-size-fits-all solution to all IT-related challenges.
What is a Dedicated Development Team Model?
A dedicated development team is a team of developers that a company uses long-term. Technically, they are not employees; they are closer to third-party contractors. However, their skills are used by the company for an extended period to enable itself to meet specific goals or quotas or for tasks its regular employees are incapable of.
There are similarities between a dedicated development team and an in-house team. For example, both work for a single company and are expected to remain there. However, a dedicated team is charged independently; they do not require admin fees, HR resources, taxation, or social benefits (such as healthcare plans).
With a dedicated development team, the team is hired for the period they are required to work. This may be six months, two years, one year, or however long they are needed. People on the dedicated development team will be required to work full-time for the company during the time they are working on the project or goal.
One alternative is the fixed price, in which the price for a project is agreed upon in advance and paid regardless of how long it takes. Another alternative is Time & Effort, in which payment is hourly.
When Should You Hire a Development Team?
1. You Have a Long-term and Large Project
If a company has a large task, which consists of multiple smaller tasks, it can be challenging for employees to take on the new task while also going about their regular jobs. Some tasks are so large they need a team of people to work on them full-time without being distracted by other assignments or duties.
For example, suppose you wish to run a new app. In that case, it could be wise to hire dedicated android developers instead of asking already busy and untrained-in-app software staff.
2. You Want Control Over the Resources
When you hire a dedicated team, you can fully manage the project and the team running it. You will own all the data and software created during the project.
Because you are their customer, not their boss, everything they create during the project should belong to you.
3. Advantages of Dedicated Team
Cost
Hiring a team for a long-term project is significantly cheaper than hiring new staff. It reduces HR costs and decimates overheads, and allows you to hire people in countries where skilled work is more affordable.
Focused
Unlike fixed price or time and effort projects, a dedicated team can focus only on your project, which allows them to dedicate themselves fully to meeting your goal.
Transparent Management
Many dedicated teams will allow their customers (companies) to use time tracking and task management, so you can see how they're getting on with a particular goal. This lets the team and customer/company know everyone is on the same page.
Websites such as Slack also allow for better team communication.
Relevant Experience and Expertise
Since dedicated teams are not technically employees but businesses that help other companies, they will come to a project with previous experience and relevant qualifications. Because they will be more qualified than the organization they're currently working for, they can offer helpful advice on better meeting a goal.
The team should also be great at delegating tasks since they should be used to working together.
Tight Collaboration
The client and the team often work closely together. With daily communication, brainstorming, and planning meetings, faster development is almost guaranteed.
4. Disadvantages of a Dedicated Development Team
It's Not Suitable for Short-term Projects
A dedicated team is unnecessary if a project will not last longer than a few weeks. In this scenario, it will be more efficient to pay for either the whole project as an agreed sum or pay the team hourly.
It's Not a One-size Fits-all Approach
There are some projects for which a long-term dedicated development team might not work. For example, an app that needs constant updating might work better if a full-time in-house team runs it.
If the Goals are Clear, a Dedicated Team Might be Unwise
If you're 100% certain of the goals and are confident they will not change, paying for the project as an agreed sum could be better. This option sacrifices flexibility for affordability, but that could work better for some projects.
Time Zones
Although hiring people from overseas can be cheaper, they might not be available when you need them. For example, when it's 10 am in New York, it will be 8:30 pm in India, when many of them have finished work for the day.
Ethical Concerns
Since this team is working full-time for a limited but long-term period, some may have concerns about not giving them the same benefits as regular employees. It's like having all the benefits of a group of employees with none of the responsibilities.
Summary
A dedicated development team is an outsourced team of developers who work full-time for a limited by long-term period to help a specific customer (a company) achieve a goal or set of goals. It can be cheaper, more flexible, and more efficient than some alternatives. But, it's not a one-size-fits-all solution to all IT-related challenges.
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