There are several different working models for hiring people to work on your projects. In short, outstaffing is hiring someone from another company to work for you. Not to be confused with outsourcing, which is hiring another company to do some work for you. Most frequently when people talk about outstaffing they are referring to software development, and that’s what this article will discuss.
When to use outstaffing?
When you have a project and need some software development done, you have a few options. You can hire employees, hire contractors, find a company that will do the project for you (outsource), or hire developers from another company to work for you (outstaff). These are just different models for hiring people to work on your software, each one with its own strengths and weaknesses, and you should use the appropriate one for your specific scenario.
Outsourcing is only really suitable when you have a well defined project to begin with, which is most often not the case. If you are building long term and your requirements are constantly changing, you want to control development. An ideal scenario for outsourcing, for example, would be adding an AI module to your current project. It’s a well defined project that you wouldn’t have the expertise in house to do, so you would set clear requirements and pass it off to a company that specializes in AI. They would then deliver a single self contained package and that specific engagement would be over.
If your use case doesn’t fit the outsourcing model then you have to consider hiring employees or contractors. Employees are permanent placements in your company. If you have an ongoing project, it makes sense for you to hire some employees to control development and keep knowledge in house. Contractors make sense when you are looking for a temporary engagement. For example, let’s say you have a tight deadline and you need more resources to shore up your team. Or, if you want an expert in some technology to come in, set it up, get the rest of your team up to speed on how to use it and then leave.
Outstaffing and hiring contractors are very similar. The only real difference is that you are either engaging contractors directly or going through an agency to engage them for you. The main benefit of going through an agency is that you don’t have to spend time doing recruitment, which is very time consuming. The agency, theoretically, already does recruitment full time and is good at screening candidates. They also have a large pool of proven candidates to call on. That also means that the agency will give you more flexibility to scale up or down than if you did it yourself.
You can outstaff both local or offshore staff. The big benefit of offshore staff is the massive reduction in costs. For the price of one employee, you can get 2 employees and still maintain the same level of quality. Your trade off is going to be language barriers and time zone issues.
A good model is hiring a combination of local and offshore resources to minimize the downsides, while still maintaining knowledge in house, and reducing costs. For example, a local team lead, that can communicate and manage the remote team. This is now becoming a great model since our remote tools are getting so much better (tools like Slack).
How to hire outstaffing services?
In general, choosing a good company is as essential as choosing a good developer. A bad outstaffing company will just try to fill bodies, and the quality of candidates that you will be getting will be sub-par.
The best way to find a good company, as always, is word of mouth. If someone you know is happy with a company, that’s a good indicator that the company takes its job seriously and can be trusted.
The next best way is user reviews, although these are not always reliable. In the US, these companies are known as “staffing agencies”. If you go to clutch.co you can see a large list of local and offshore staffing companies, with reviews. beststaffingagencies.com also has a large list of staffing agency reviews and scores.
If you are looking for offshore staff, you can also go on Upwork and engage with one of the outsourcing agencies there, they are all willing to outstaff as well as outsource and all have lots of reviews. Make sure to engage with a reputable company, and not just the lowest cost provider. The decision to do offshore or local staff is another big topic that will have to be discussed in a different article.
Written by Eddie Svirsky