Outsourcing vs. Outstaffing: What should tech leaders know?

Outstaffing Vs. Outsourcing

What if we put outsourcing vs. outstaffing face to face and explore how they cover the same business objectives?

Integration and control

Your outstaffing partner can hire dedicated professionals for you. You can fully control those specialists, as they work exclusively on your projects, adhere to your company culture, and are managed directly by your internal team. You get direct communication, tighter integration into your processes, and better alignment with your business goals.

On the other hand, outsourcing usually entails a more hands-off approach. You entrust the outsourced tasks or projects to the external provider, and they handle the work independently. While this can free up your internal resources, you can lose control over the outsourced team.

Scalability

Outstaffing offers greater scalability in terms of team size. You can scale your outstaffed team up due to your project requirements. This flexibility is particularly advantageous in the tech industry, where project scopes can change rapidly.

In outsourcing, scaling can be a bit more challenging. You may need to renegotiate contracts or agreements with the outsourcing provider, which can lead to delays and administrative hurdles.

Expertise and specialization

Outsourcing is a good option when you need specialized expertise for a task or project. External providers are experts in their field and can deliver high-quality results. However, this expertise might not always align perfectly with your unique requirements.

Yet, Talent Acquisition Specialists from outstaffing companies scan the global talent base to find the team members who match your unique needs. Then, they conduct job interviews tailored to each team role.

Selecting the right approach

Decision-making factors

Here are the indicators helping tech leaders to weigh outsourcing vs. outstaffing and determine the best fit for their company.

Project complexity

If you have relatively straightforward tasks that require specialized expertise, outsourcing might be the way to go. 

When you, let’s say, need to develop some features for a web app user interface, both, outstaffing and outsourcing, could be suitable. Outsourcing is a turnkey solution if you don’t want to handle it internally. Outstaffing is a team-scaling method that could be right for you if you are sticking to the agile team structure and want to integrate design specialists into your web development team.

However, if your projects are intricate and demand ongoing collaboration, outstaffing could provide better results due to the increased control and integration it offers.

Imagine your tech business requires ongoing data analysis and machine learning expertise. Outstaffing could provide you with reliable results here. You can hire data scientists and machine learning engineers who become an integral part of your team, working closely with your in-house developers and analysts.

Project duration

Outsourcing can cover short-term projects, like data migration or report creation, as it doesn’t require a long-term commitment. 

Outstaffing can be a more sustainable option for long-term or continuous support, as it allows you to build a dedicated team that aligns with your company culture and long-term goals. For instance, such an approach is great for scaling a tech support team. An outstaffing agency can provide tech companies with remote customer support agents, employed by that outstaffing agency (often through the EOR services) without the complexities of traditional in-house hiring.

Check the reputation first and make pulse checks next

At the stage where you’ve understood the subtle differences between outsourcing and outstaffing, you can make the right choice to optimize your tech projects and drive business success. Yet, the preparation for the new cooperation doesn’t end here. The next thing to do is to focus on filtering the service providers who support the chosen business model to get the most out of it. Read reviews about those companies and be curious about their cases and a full palette of the opportunities they can bring.

In the end, tech leaders stay informed in order to stay competitive. Don’t stop evaluating your partners when the successful partnership is already on track. Make revisions of their performance and your tech goals from time to time. Remember that the question “Outsourcing vs. outstaffing: what’s better?” typically has only a temporary answer. You can change the format from outsourcing to outstaffing or vice versa when your business demands change.