A survey by Deloitte reveals the IT industry topping when it comes to outsourcing.

Imagine a scenario where your business needs to build custom software. Perhaps, the next question you have in mind is how are you going to do this? Well, there are several choices: in-house, freelance, or offshore/nearshore outsourcing model.

With how accelerated everything is, gone are the days of classic recruitment styles. As an entrepreneur, you must consider what works best for your particular project. To make decision-making easier, however, this article discusses each hiring option.

Hiring an in-house development team

In the traditional economy, a software engineer typically spends a working day at the office from 9 to 5. This setup offers convenience, because any issue arising during a development project can easily be solved through face-to-face meetings. Apart from that, having a local team is more likely to be there for the long haul, which gives further assurance to the company.

However, in-house hiring has several downsides despite the advantages. One, recruitment costs can be quite high, since impressing top developers involves more than just discussions about salary, but additional perks like health insurance, training, and other bonuses as part of the compensation package, too. Furthermore, individual taxes and office space can rack up business expenses. The talent acquisition process also takes a considerable amount of time, especially if there is a lack of experienced and qualified domestic programmers.

Considering freelancers

Firms have changed their way of operation and are no longer tied to conventional means of engaging with potential employees. As such, an alternative is through contracting freelance software developers to perform specific short-term tasks. You may wonder, why hire a freelancer? Well, companies only need to pay the contractorโ€™s flat rate without providing fringe benefits, which is more cost-efficient.

Still, a freelance hire presents certain risks like having a lower level of experience and dedication compared to an on-site developer that can affect the overall quality of the bespoke software. Another possibility is how a contracted engineer can terminate the contract at any time, leading to a huge loss for the project.

Outsourcing as a game changer

In the highly competitive tech market, companies see the necessity to diversify methods of acquiring professionals, particularly if there is some difficulty due to larger corporations taking a hold of premium talent first. Thus, outsourcingโ โ€”whether nearshore or offshoreโ โ€”is the golden mean, and will only continue to grow. As a matter of fact, the IT industry ranks number one in outsourcing.

The edge nearshore outsourcing gives the similarity of culture and time zones, so hired developers will not find the adjustment period too demanding. In addition, communication is easier, because there are less deviations. However, nearshore teams are not as cheap as offshore companies.

The benefits of offshore outsourcing include access to software engineers with niche expertise that would be otherwise unavailable locally. Another advantage is these proficient programmers are vetted and usually focused and committed to the success of the project at a time. Furthermore, turnaround time tends to be quicker with offshore teams.

As for the cons of offshore outsourcing, the biggest will be the cultural differences, especially for software developers hired from across the world. Time zones also play a role in possible communication issues. To counter these disadvantages, companies must do their part in integrating dedicated offshore hires, which, if successful, is a sustainable solution.

When it comes to the offshore outsourcing model, find a reliable system integrator with multiple offices located around the globe. This arrangement removes the gap caused by time zones between teams and guarantees an effortless working process.

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