Survival can be summed up in three words: never give up.
British adventurer Bear Grylls OBE
We’ve been going through quite a tumultuous time for the past two years, and drastic changes have occurred in industries all around the world. Businesses are not immune to the changes, so it might be the right time to weigh the benefits of hunkering down and waiting for a light at the end of the tunnel or taking risk during a very risky time. People around the globe are facing challenges not seen in decades: a pandemic, economic shockwaves, and an uncertain future. All of this has pushed people to choose alternative ways of dealing with their business and addressing the new challenges. Companies have to thoroughly examine all aspects of their operations in order to weather the seemingly never-ending storm, and that includes an analysis of outsourcing and insourcing.
When talking about the new ways of doing things in the domain of custom software development, the discourse around the benefits of insource vs outsource software development has become as relevant as ever. With the pandemic locking people at their homes for months, we’ve learned that it is not that necessary to keep all of your employees in-house and that it is rather sufficient to just let them work from whatever place they deem comfortable, as long as they keep doing their job. So, do you really need to keep all of your employees in-house or is it actually more sufficient to work with the outsourced teams who can do as good a job? That is exactly what we are going to find out by comparing the benefits of in-house vs outsourced development.
With insourcing, a company chooses to assign a new project to a member(s) of its own IT department. This could result in a departmental reorganization, hiring new staff, whether temporarily or permanently, and retraining. It is a traditional hiring method where you find people who fit your job description and have the relevant skills and assign certain tasks to them according to their area of expertise.
A company that opts for IT outsourcing basically hires another company to perform certain tasks related to the company’s functioning. In the IT domain, outsourcing means that the client company delegated the tasks related to the development of certain software to the vendor company. Simply put, you hire people from the outside on a temporary basis and they would serve as a part of your team with the difference being that they would work remotely. However, that is not the only difference as outsourcing packs many more benefits albeit with a couple of caveats.
Simply put, the insourced team is in-house, giving a company total control of all personnel, the services provided, and/or a specific project. This means that you have direct face-to-face contact with the developers, can manage their performance directly, and monitor the progress of the project delivery on the spot. This is where the insource model shines – full control and total immersion in the development process.
The staff would understand the goals and objectives and subscribe to the corporate culture. Managers could provide input and guidance on a daily basis, offer feedback, and monitor progress. Scheduled performance reviews would help with employee growth and identify new training opportunities. Staff activities build morale and foster a greater sense of teamwork. A free lunch, for example, is a big hit in every office. Overall, having your development team working in the same building as you is great, and this can even strengthen your relationships, boost dedication, improve productivity, and make working in your organization more pleasant overall.
Other insourcing pros are:
But IT insourcing is not a perfect solution for any project. The main reasons why many firms switch to outsourcing their software development projects are the ease of hiring and handling the projects. But at the end of the day, it all comes down to money.
Top tech talent is in hot demand, even during these upside-down times. Recruitment and retention efforts will impact the bottom line, along with salaries, benefits, and bonuses. Fending off poachers from other companies would also need to be top of mind. Rather than focus on the actual work being done, managers could be trapped in a constant hiring loop. Onboarding for new staff, and other Human Resources related issues, is also time-consuming. The required IT skills and talents would change and that might necessitate staff changes, which increases stress and anxiety in the workplace.
Retraining or upgrading is an extra cost, and would temporarily decrease productivity while staff members are not actively engaged in the development. That is where the disadvantages of insourcing come to play.
The global pandemic smashed traditional views on how and where we should work. Working from home is now the norm for millions of people, and companies are getting used to the idea of a workforce that doesn’t commute to their office buildings downtown in a big city. Many people are even giving up their homes/apartments and heading out on an adventure. This is how things are today, and you need to adapt to this new reality and make the most out of it. Outsourcing has become even more prominent throughout the past year and a half, and you can surely benefit from the advantages offered by this model.
There are benefits a business that contracts a software development outsourcing company can gain, and these are mostly based on the cost-efficiency of this approach. It is true – when comparing insourcing vs outsourcing software development, the latter surely is a more cost and time-efficient model. More so, it allows for much greater flexibility using a wide variety of different approaches to software development such as agile, waterfall, XP, lean, and more. All of this, can benefit your product and streamline your software development lifecycle for maximum efficiency.
Of course, a company’s approach to an insourcing vs outsourcing decision has to be measured and cost-effective. Each model has its pros and cons, though, so you should be aware of those when opting for either. Insourcing really is a great choice for building a strong team of professionals who are loyal to your business and know exactly what is going on there and what solutions need to be implemented to get the maximum benefit.
Outsourcing has its flaws too, so you have to consider the following:
Deciding when to outsource vs insource IT isn’t an easy one, but with extensive research on costs, goals, and resources available, the picture will become much clearer. As you see, outsourcing is not a magic pill and there are some issues related to the implementation of this strategy that might put a strain on your business and make it less efficient. At the same time, outsourcing offers some solid benefits such as cost-efficiency, fast recruitment, access to a broad talent pool, and many more. Insourcing also has its perks such as improved communication and more control over the project delivery. All of the pros and cons of both approaches are up to you to weigh out, and you can surely make an informed decision based on the current needs of your organization.
Choosing between insourcing and outsourcing is not an easy deal and you must remember to always put your interests upfront. Do you need to save money, hire people fast, and get the job done? Well, in that case, outsourcing is for you. Do you want to build a strong, loyal, and professional team of developers you’d be able to talk to at any given moment? That is where insourcing would be a better option to go with. While the two approaches are so different, with each having its benefits and its flaws, both of them can benefit your business under the right circumstances. It all comes down to what suits your business right now, and if you want to achieve better cost efficiency, save a considerable chunk of your budget, get your project going fast, and tap into a broad talent pool that consists of developers from all around the world, Intersog can get it done for you.
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