Software development outsourcing means precisely what you think it does: an organisation outsources a software development project to a third-party contractor.
A software development project can be an application or software the business needs to grow, operate or automate its processes, such as a custom enterprise resource planning system.
If you’re a tech company, software development outsourcing is probably one of your primary sources of revenue.
Read on to learn about software development outsourcing trends and how an information technology or IT recruitment agency can help you expand and grow.
Software Development Outsourcing Trends
Mordor Intelligence says the information technology outsourcing market was worth USD 526.6 billion in 2021. At a 4.13% forecasted compound annual growth rate beginning in 2022, the IT outsourcing market will be worth USD 682.3 billion by 2027.
Software development outsourcing is one of the most active segments in the industry. Application development and maintenance are two of the most frequently outsourced IT functions.
Digital transformation, such as incorporating blockchain, artificial intelligence, data analytics, hybrid workplace, and automation technologies in business operations, is a factor in the growth of IT outsourcing, particularly partial or full software development outsourcing. The skills gap or shortage is another.
In a global survey published in 2020, McKinsey says 87% of the companies surveyed reported that they expect to experience a skills gap in a few years or are already experiencing it.
A tech skills gap seems to be of particular concern. Forty-three per cent of respondents claimed they have a skills gap in data analytics, while 26% said they have a skills gap in IT, mobile, and web design and management.
How Tech Staffing Can Help Your Business Grow
As a software development company, you are the third-party contractor in software development outsourcing transactions. In other words, you need to build the software or set up the system that the contracting organisation needs, say, an artificial intelligence or AI-powered unit scheduling and routing system.
You can develop the entire software or system yourself or divide it into its components and parcel out some or a few of them to one or more software development firms. For instance, a single project may be subdivided into the following components:
- Software architecture
- Software QA
- Front-end development
- Android development
- iOS development
- UX design
- DevOps
If you want maximum returns on a project, you probably don’t want to outsource the project to other firms. But what if you don’t have the human resources to work on all project components? That’s where tech staffing comes in.
Grow With Tech Staffing
Instead of outsourcing the different components of your software development project to other firms, you can work on your project entirely in-house by improving and adding to your tech talent capacity.
In other words, you can hire additional personnel, including software architects, quality analysts, UX designers, Android developers, iOS developers, and DevOps engineers. This will enable your organisation to work on all the necessary components of a project yourself and thus enjoy a higher profit margin.
Of course, hiring more people is easier said than done. You certainly don’t want to over-staff. That will only lead to overwhelming yet unnecessary overhead. However, you also don’t want to be too circumspect about adding to your workforce. This will lead to unhappy employees (i.e., over-capacity and working long hours to meet deadlines).
Tech staffing can help. A tech recruitment company will enable you to grow and reach your human resource capacity requirements.
The following are the advantages of working with a tech staffing agency.
1. Scale up quickly through your recruitment partner’s experience and expertise.
Tech staffing companies have a ready pool of talent from all over the world, and they have already perfected their tech candidate screening and hiring processes.
Additionally, they have the administrative expertise to manage and engage their pool of tech talents. Their established employee tracking and human resource management tools, systems and protocols, and supporting services (e.g., visa sponsorship) mean fast deployment and talent onboarding.
Therefore, tech recruitment agencies will be able to help you fill open roles quickly, enabling you to begin work on an existing project as soon as possible or accept even more clients.
2. Maintain operational flexibility through contract-to-hire arrangement.
A contract-to-hire arrangement will allow you to add as many people as you need without committing to permanent employment.
In a contract-to-hire arrangement, you can hire people for a predetermined period. This will help you immediately address your organisation’s tech skill gaps.
During the contracted time, you and your new employee can assess each other for fit. At the end of the discovery period, you may offer permanent employment to your contract-to-hire employee — but you’re not obligated to do so.
Therefore, working with a tech staffing company ensures flexibility in your hiring decisions.
3. Ensure output quality through skilled hires.
While you will be responsible for ensuring output quality, having skilled people will absolutely help, and an IT recruitment company can help you find such talent.
Tech staffing companies specialise in recruiting tech talent. Their specialisation in tech means they have established processes, years of experience, and expertise in software development tools, strategies, and technologies. Thus, they know the role requirements by heart and understand which keywords to look for in applicant resumes and credentials.
4. Save money by hiring remote staff.
When you hire programmers to work in-office, you must provide them with space and equipment. You will also need to spend hours and use many resources to train them. Aside from that, you will need to provide them with insurance, paid vacation, and maybe even food and travel allowances.
When you hire remote workers, you can save on these costs.
Just tell your recruitment agency partner about your requirements, and it should be able to create a fully functional, ready-to-deploy remote team on your behalf. You will only need to cover the contract price; there will be no other charges.
Scale Up Your Business With Tech Staffing
If you need help to fulfil software development orders, hire more people.
To this end, find a tech staffing company that can help you scale up and down flexibly through tailored employment solutions that will help you save money and fill open roles quickly.
