Hire a Dedicated Software Development Team in 2023: Pros and Cons of this Approach, and Practical Advice
A lot has changed in the business world after the major shift to remote work. Numerous in-house teams are getting replaced with outsourced employees, which is especially evident in the software development sector.
With a big project coming up, more and more companies regardless of size choose to find a trustworthy software outsourcing company instead of hiring their own staff. They do so for multiple reasons, including cutting costs. But is hiring a dedicated development team a one-size-fits-all solution?
On this page, we explain this partnership model, when it is suitable, and what advantages it has. Plus, we share expert advice on where and how to hire a team of developers, giving you pointers, average rates, and even a checklist to follow.
What Is a Dedicated Software Development Team?
You're probably wondering what sets a dedicated software development team apart from other types of IT outsourcing. This kind of partnership is aimed at a long-term project-based collaboration of a client company and a group of professionals from an outsourcing software development company.
"Dedicated" implies that the development team is hand-picked and assembled by the provider from its talent pool to work specifically on the project. Importantly, every team is assigned to one project at a time to deliver the best results within a given period.
In a way, it's like renting the workforce. During the contract, the remote developers and other hired specialists can be considered as part of the client company. This guarantees that the development team will be completely focused and won't wriggle out or get reassigned to some other tasks until the agreed work is completed.
As a rule, this is not a one-time agreement for a small task scope. We're talking about something broad-scale, for instance:
- the development of a website;
- complex site migration;
- custom mobile app development;
- marketplace development;
- building a custom SaaS solution;
- among others.
This is why the dedicated team model is often chosen by large enterprises that are planning to launch a large project or need a hand with filling their technical expertise gap. Startups whose goal is fast growth also tend to opt for this collaboration type.
5 Benefits of Hiring a Dedicated Software Development Team
There are multiple "pros" when choosing this model of partnership. Otherwise, it wouldn't be so common, right?
1. Cutting Costs
Partnering up with a dedicated development team is a cost-effective move. Especially when compared to the process of hiring individual freelancers or people in-house to scale the team.
To compare, assembling your in-house development team entails additional costs and fundamental resources like time. You'll be:
- paying your recruiters and HR specialists;
- spending time on the employee hunt and further onboarding;
- issuing each hired employee monthly salaries, paying taxes, bonuses, insurance, and other social benefits;
- renting office space, paying maintenance bills, purchasing computers, hardware, software, and other things.
With a dedicated team, your tech vendor supplies you with a completely seasoned team from its own talent pool. And, notably, you pay by the hour according to the signed rates. Taxes and all the employee expenses are the provider's responsibility, not yours. Such predictability simplifies business or startup budget planning and can significantly cut costs.
2. Focused Approach
As shortly mentioned earlier, with a dedicated team of developers your project becomes the main focus. This collaboration is all about turnkey projects, which might not be the case if you choose in favor of several freelancers.
What does this mean for the client? Faster time to market, fewer roadblocks, and a committed team of professionals who care about quality and the final result just as much as you do.
Besides, you mitigate risks since you don't have to worry that the team will dump you halfway through and switch to something else. They work on your project exclusively, and you have all the needed resources to concentrate on other operations that are important for the business.
Another good thing about such a software development team is that you can manage and alter the hired staff according to your needs. The same applies to the workflow and scope.
Once again, you don't have to invest any resources in the recruitment process. If you'll need more specialists at some point or would like to adjust the composition of the team, your provider can make it happen. If a shift in your project's scope, vision, or timeline occurs, the dedicated team will adapt to the changes.
4. Access to Global Talent
Hiring locally to build your team may turn out to be more expensive and challenging than finding a ready-assembled outsource development team. Considering the talent pool beyond your geographical borders gives the chance to obtain an experienced workforce like an outsourced CTO or senior developer without the worries about time zones or language barriers.
By using an employer of record service (from a provider such as remote.com) companies can also benefit from streamlined payroll and compliance management, allowing them to avoid the administrative burden that usually accompanies overseas hiring. In other words, there are now fewer barriers than ever before to a business building a truly global team.
Let's face it, we've already got used to the peculiarities of remote work. And this global shift has been continuously showing fruitful results since the start of the 2020 pandemic. In fact, numerous organizations have even managed to structure their operations in such a way that different time zones provide the advantage of an almost round-the-clock non-stop working process.
5. Project Control
Partnering up with the right vendor that provides you with an outsource development team supposes transparency. Due to this, it becomes much easier to run the project.
With explicit project and startup tools for management, such as Jira or ClickUp, all the processes are at glance. They help the dedicated team work cohesively and improve productivity, agility, and delivery speed. As a client, you also have access to the tools, so you are free to check the tasks' status and see how the work is progressing.
Depending on the agreed communication terms, you can receive timely updates and control the milestones. This may be achieved using weekly progress reports or, for instance, by jumping on call every Monday to discuss the latest updates. All possible changes on your end are negotiable as well.
When You Should Hire a Dedicated Development Team
A dedicated partnership is considered the best-fit scenario in the following cases.
Complex and Long-Running Projects
This model is reasonable for large-scale projects that may expand even further in the long run. In this case, you'll need a partner to support you not only during the development process but also in the years to come. Whether it is maintenance or working on side projects that stem from the main one, having the same team with you the entire way is an undeniable perk.
Alternatively, this collaboration type can be a solution if:
- you're lacking an in-house development team altogether;
- your in-house team has a hired CTO but doesn't have the resources to take on a new project;
- or your developers don't have the required expertise in a certain field (e.g., you need an iOS or Android application, but your developers are geared to building e-commerce websites).
New and Growing Startups
A dedicated team model is just a good fit for startups as it is for established enterprises. Aspiring startups at an early stage can reap many benefits from such collaboration as it saves time and money on recruitment and gets the product running much faster. And since startups often expand at a quick rate, a large portion of the work can be delegated to an outsourced development team. You can start by building an MVP and move on to project or startup scaling as the firm grows.
Projects Without Clear Requirements
If you don't have a final idea of what the project should be like in the end, then it also makes sense to hire a dedicated software development team. This is the right path to follow if you feel that you still need time to:
- finalize the requirements and details;
- determine the vision;
- or when there's a chance that the concept and work scope may substantially change.
It is very common when a project seems vague at the start, implying some time for the discovery stage. But since a dedicated team is flexible, it will spare you the required resources, and you won't end up draining the budget.
When You Should NOT Use a Dedicated Team Model
Of course, there are cases when there are more reasonable alternatives to hiring a dedicated development team.
Short-Term Projects and Those with Strict Requirements
For starters, if your project has clean-cut requirements, you can go for the fixed-price model instead. There's simply no need for a dedicated software development team when the project is small, short-term, and has a specifically defined work scope and chosen tech stack. If you know exactly what you need, make a fixed-price arrangement with outsourced developers. Possibly, even a couple of freelancers may be enough.
For mid-sized projects with a predetermined scope (or one that might slightly change), you may consider opting for a contract with hourly rates instead of a fixed price. The only difference is the lack of necessity to hire a dedicated team that'll be obliged to stick with you till the end.
Again, if you have made accurate project estimations and your scope is planned from task A to task Z, there's no reason to overpay for dedicated developers. And if someone you hire won't be available for some reason or gets reassigned to another project, it'll be simpler to find a replacement.
If You Have a Budget Limit or You're Short on Time
On another note, if the project's budget is tight or your deadlines are highly limited, then maybe you don't need a software development team with dedicated full-time specialists. Paying a fixed price for the required workload can be sufficient to reach your goal and supplement your startup team structure for some time.
Hiring a Dedicated Software Development Team: Structure
On average, dedicated teams have 6 to 8 people, but it doesn't imply only developers. You can request your vendor to add on other roles from their pool if needed. Here's a list of specialists in a possible web development team structure:
- Project Manager (controls all the project processes from task distribution and deadlines to communication);
- UX/UI Designers (create prototypes, designs, and the overall look);
- Front-end Developers (handle the client-side of the code that users see);
- Back-end Developers (create all the code and logic behind what's visible to the users);
- QA Engineers (are responsible for QA testing, checking the code, and allocating bugs).
Based on the specific project goals, a team can additionally include a Business Analyst, Solution Architect, DevOps Engineer, among others. Their hourly rates and the final pricing of the project may vary based on the specialists' experience and qualifications.
Where to Hire a Dedicated Software Development Team
Now that you have a better understanding of what such collaboration is about, let's figure out where to find the best-match partners.
The question of how to choose a dedicated development team often starts with "where". Once again, your hunt doesn't have to be restricted only to your own country. Consider offshore options too since most companies use English as the main business language and may even offer better rates.
The global market boasts a lot of expert developers not only in the Americas but also in different parts of Europe, Asia, and Australia. According to the data on Clutch (as of January 2023), here's a graph showing how many software development companies there are in some of the most popular IT outsourcing countries in the world.
India and its impressive 3511 firms didn't make the graph. To be fair, many other countries can also brag about having a large number of software development firms like the UK (1131), Germany (483), Romania (391), the United Arab Emirates (296), the Netherlands (203), and many others.
What Are the Developers' Rates?
Although there are so many options to choose from, the number of firms isn't the only factor to take into consideration. Since you're going to hire a software development team and pay by the hour, the rates are no less important.
Keep in mind that the hourly rates may greatly differ based on:
- the position (e.g., Front-end Developer vs QA Engineer);
- the level of expertise (Junior vs Senior specialist);
- the region;
- hiring outsource vs. freelance specialists.
We've researched the data on the developers' average hourly rates in USD worldwide on various resources, including SalaryExpert, Clutch, and Upwork. Generally, you can expect the highest rates from Canadian, US, and Australian developers. As such, developers from the USA charge 65 USD per hour and up, while the rates of developers from India start from 20 USD. In any event, it's important to remember that the lowest prices don't always guarantee the best quality.
On the whole, the average hourly rate of developers by region is as follows:
- Asia 20-45 USD;
- Africa 25-45 USD;
- Latin America 35-70 USD;
- Europe 30-65 USD.
To compare, here's a graph of the average rates in Europe. As you see, this region can be considered a neat middle ground in terms of rates and quality. Furthermore, there's a greater variety of IT development companies to choose from.
Which Platforms to Use to Hire a Dedicated Team of Developers
There are several trustworthy platforms to use when you look for a reliable dedicated team of developers. All three listed below can simplify your search as they have easy-to-use filters that allow you to sort companies by country, hourly rates, rating, etc. They also share many articles, comparisons, and other vital information.
- IT Firms (an extensive resource collecting data on a wide range of software development companies and providing lots of useful "Top" lists);
- Clutch (offers detailed information on thousands of B2B companies, their areas of expertise, staff size, number of branches, contact information, and even reviews);
- DesignRush (a B2B marketplace to find top custom software development companies)
- GoodFirms (one more platform for finding business partners with many helpful materials).
How to Choose a Dedicated Development Team: 5 Steps to Follow
To get you started and streamline your hunt, we've narrowed the process down to five simple steps.
Step 1: Line Out the Future Project
It is best to begin by outlining the future project. What is your business idea and vision? What do you want to achieve? How much time do you have? What are the core requirements and scope ahead?
If you have a project brief or a product roadmap to share with the potential development partner, this will speed up the overall process and bring you better results. Even if some points aren't final yet and you only have estimates, a short overview can set you on the right track to finding perfect dedicated developers.
Step 2: Study the Market
Researching the available offers is a time-consuming step. Yet it will allow you to make a more deliberate decision on which dedicated development team to hire based on facts and numbers.
The first tip would be to think out of the box and broaden your search geographically. Your partner doesn't have to be from your country or continent, there are many great options overseas too. Browse platforms like IT Firms or Clutch to find vendors or use Google search to find corresponding service pages.
Then make a list of five to ten companies worth further consideration. Optionally, create a spreadsheet where you can jot down vital vendor evaluation and scoring points. These can be approximate pricing, years in business, staff size, number of similar projects, etc.
Step 3: Browse the Testimonials
Learning the opinions of other client companies like yourself before you hire a development team is considered good practice. You don't necessarily have to limit yourself only to the reviews and catchy short quotes that are posted on the vendor's website. Feel free to look up the dedicated software development company on various professional platforms we've mentioned earlier. There you can find the verified testimonials of those who have already done business with the outsourcing vendor.
Study as much feedback as you can and note the strong and weak spots that were mentioned by others. This will help you get a better idea of what the company is like and how your cooperation may go. Bottom line, if the provider is irresponsible, such reviews will allow you to avoid an unsuccessful investment and choose someone else.
Step 4: Check Out the Portfolio
Most vendors with the due expertise usually have a decent portfolio, showcasing detailed case studies on the projects that were successfully delivered or are in progress. Such examples outline the aims, approaches, and solutions that were used by the company to achieve the client's requirements and goals.
By looking through several of them, you'll get a general understanding of the processes and whether the outsource development team is a good fit.
Pay special attention to those projects resembling yours. If the provider has already worked on something similar, you may investigate the final result and make conclusions on what you'd like to improve or implement differently. Plus, since the team knows what it's doing, this can bring you the advantage of saved time and costs (rather than if you'd partner up with first-timers in your field).
Step 5: Interview a Dedicated Team
The final step of hiring software engineers is interviewing the candidates. You can set up video calls, say, via Google Meet, to discuss the project, get to know the vendor, and maybe even the Project Manager or the whole development team.
Prepare a list of questions and state the deliverables. You may ask about the company's previous experience with similar projects and how they'd approach yours. Bring up questions like employee availability, how big the team could be, and which solutions they suggest.
If you need more details, enquire about specific specialists. After all, it's good to know who you're dealing with as you might need the services of certain individuals for other projects or can decide to ask to replace someone who isn't a good fit.
Is a Dedicated Software Development Team Right for You?
Summing up, a dedicated team of software developers is a worthwhile investment in cases when you have a large project and need a reliable partner to make it happen. Whether you're an aspiring startup or an established enterprise, having a team of experts that'll be with you the entire way is great for reaching your final goal. This collaboration model is more cost-effective than it might seem at first and surely has many advantages.
You can approach the hunt for an ideal vendor to partner up with by looking into the global talent pool. There are hundreds of trustworthy outsourcing companies around the world that you may consider. At Upsilon, we have an extensive staff of dedicated developers ready to boost your product development with the best-in-class team augmentation services for growth stage startups. Therefore, feel free to get in touch with us!