In-House vs Remote Developers: What Should You Choose?

 

In-House vs Remote Developers - Which One to Opt for? That is the question, isn't it? There are a lot of factors involved in choosing whether to use an in-house developer or a remote developer. If your business doesn't already have an in-house developer, you're not sure whether to hire one. Or perhaps you have an in-house developer, but your team is overwhelmed…so you're thinking about whether to bring on more developers through outsourcing.

In the current global post-pandemic situation, remote work is the future of work, many would call it the new normal. Even companies with the most rigid and traditional working environments have come to realize the importance of working remotely. They are finally coming to terms with the endless possibilities and opportunities that remote work has to offer and are looking for remote developers.

With just the right strategy, companies can make the remote landscape work for them, and it turns out, it is way more preferable to being in the office. But I am not here to talk about remote work in general, in fact, we are interested in exploring the best options to choose between in-house development vs outsourcing.

If you have decided to build an application or a website but can not determine how to organize and proceed with your development processes, this blog is for you. So, stick around!

Read more here: Qualities Of A Great Developer

Choosing Between In-House vs. Outsourced Software Development

The biggest challenge for companies is to recruit the right talent at the right time. If you are an HR personnel, reading this blog post; you would agree how hard it is to find and retain tech specialists especially when you have a time constraint and your project schedule is falling behind than initially planned.

Time is of the essence for businesses who want to achieve their goals faster and I am sure every company wants time to be on their side.

According to sources, it takes about 40 days on average to find an in-house developer, on the other hand, you can find an outsourcing company in a matter of 1 to 4 weeks. Therefore outsourcing teams not only save time but also recruitment and administrative expenses.

Along with that, it provides you access to a rich pool of talent. Voila, problem solved! – this is one of the reasons why more and more businesses are choosing to outsource. 

Now let’s look at some of the advantages and disadvantages of in-house development teams and remote developers. Only after weighing the pros and cons, can we decide who takes home the winning trophy. So let’s dig in!

Must Read: Tools To Manage Your Remote Software Development Teams

What is In-House Project Development?

We have found a perfect definition: ‘In-house team means – conducting an activity or operation within a company, instead of relying on outsourcing. A firm uses its own employees and time to keep a division or business activity, such as financing or brokering, in-house.’ In simpler words, in-house software development is done entirely within the company.

Pros and Cons of In-House Development

PROS

Similar Cultures

Yes. Recruiting developers locally means that people share the same cultural beliefs and values as you. Nothing would come as a cultural shock to anyone. In-house development helps employees to settle in quickly and efficiently.

Developers working as full-time members of the company have more control over the project. They are rather more familiar with the goals, objectives, and specific needs of the company which, as a result, leads to high levels of motivation towards bringing in maximum value. 

Instant Availability 

Probably one of the best advantages of in-house software development. Timely responses are extremely important as they eliminate misunderstandings at the workplace and improve communication. In-house development activities strengthen the connections and increase developer efficiency with immediate access to information, saving time in the process otherwise spent on going back and forth.

Moreover, developers can remain in constant touch with the major stakeholders in case of problems that need on-the-spot assistance. Additionally, being in the same time zone, and having the same working hours and office gets the work done rather quickly too without any ambiguity. Makes sense! 

High-Quality Work

When you have a team of software developers in-house, work not only becomes faster but you can check the quality upfront. Moreover, in case the scope of the project changes, such as you can add or remove features or functionalities as per requirements in real-time.

Full Control

With in-house development, you can get full control over your project including the final delivery. Besides, everything will be happening in front of your eyes which makes it easier to manage the team and remove the things that are not working to ensure higher levels of productivity and get the best out of each and every member of the team. 

Performance Analysis

Apart from ensuring the performance of your project, in-house development can greatly help with recognizing the star performers who are making a difference and the steps you need to take to make sure they stick around. The process helps you realize your capability of retaining employees and what you can do differently for future improvements. 

In-house software development may sound easier, but it can be vulnerable to risks. Time to shed some light on the disadvantages of in-house development. 

CONS

Recruitment Time

As mentioned earlier, the recruitment of hiring developers takes time. According to the Sparks Group, ‘it takes on average 51 days to fill the position in the IT field.’ Which is roughly two months, now can companies wait that long? No, I don’t think so. Now the question is why does it take companies this long to find a suitable candidate? Some of the disadvantages of in-house software development are: 

• Companies may have a perfect fit syndrome – looking for a candidate that checks out all the boxes.
• Thorough screening processes to avoid hiring the wrong candidate.
• Great potential hires are choosing the competitors to work with because of uncompetitive salary packages. 
• Lack of candidates with the necessary experience and technical skills needed to get the job done. 
• Not able to attract many resumes. 

Higher Costs

The cost of recruiting and retaining employees is way higher than hiring remote development teams. According to an analysis by Glassdoor, ‘the average company in the US spends about $4,000 to hire a new employee.

Now, this is only one side of the story, hiring costs aside, the expenses of setting up development infrastructures in-house are beyond comparison. Testing tools, devices, laptops, servers, employee salaries, benefits, and training costs – all contribute equally to the overall expenses which are relatively higher than outsourcing developers.  

Employee Retention

Not just software developers, employees, in general, are more prone to changing jobs if they come across any opportunity in exchange for a higher pay scale. However, organizations that prioritize employee engagement have a higher chance of retaining their talent. This is where Leapsome's software to engage employees plays a crucial role. By providing a platform for continuous feedback, recognition, and professional development, Leapsome's software helps companies foster a sense of belonging and fulfillment among their workforce, reducing the likelihood of employees seeking external opportunities solely based on monetary incentives.

Developer demand is increasing, but small-sized companies mostly aren’t able to pay market-competitive salaries therefore developers leave during the crucial phase of the project which brings you back to level 0. You again have to go through the same lengthy vetting processes to find the new fit. It not only slows down the development process but also exceeds your HR budget. 

One way to improve employee retention is by using employee retention tools such as GoCo, a compliance management feature that HR teams can use to stay on top of legal requirements and avoid penalties, which can help improve employee satisfaction and retention. Not just software developers, employees, in general, are more prone to changing jobs if they come across any opportunity in exchange for a higher pay scale.

What is IT Software Outsourcing?

Software development outsourcing is when companies choose to hand over or hire an external software development company (subcontract) for their software development projects. Such third-party vendors are considered ‘the masters in their domain’, they are highly qualified and capable of handling the business requirements. 

Pros and Cons of Remote Development Teams

PROS

Cost-Efficiency

There are a great number of software outsourcing companies around the globe that offer dedicated remote teams or even individual developers at affordable (hourly) rates depending on your business engagement model. According to a survey by Deloitte, ‘59% of companies consider outsourcing as a cost-cutting tool.’ 

Just imagine how much you can save just by shifting to outsource remote developers – infrastructure costs, salaries, additional benefits, and hiring expenses, you can reduce your overall costs by 50%, give or take. Cost-effectiveness is one of the most important factors to consider when choosing between in-house vs outsourcing software development. Having said that, the outsourcing costs depend upon the following aspects:

• Timeline of your project – long-term or short-term
• The complexity of the product features and functionalities
• Flexibility and scalability options
• When do you want to start? Sooner or later
• Hire Remote Development Team. Resources you would need – Team of designers, developers and testers, project manager, hardware and software

Multiple Business Models 

When you are working with in-house developers, you follow the same business engagement model every month – giving a fixed amount of salary to developers in exchange for the work being done by the end of every month and repeat. But when you are working with outsourced remote tech teams, you get multiple options to choose from. All the more reasons to work with remote developers now, isn’t it? 

• Hourly model – where you pay remote developers by the hour, the payment depends upon the quality of work and years of experience.
• Dedicated remote team structures – instead of hiring just one person, you can outsource a team of developers for your project.
• Project-based models – Work with teams at a fixed price.
• Or a combination of any of the above-mentioned models to suit your needs.

The best thing about outsourcing is flexibility, meaning, you can hire when needed. There is no legal obligation to maintain a long-term relationship. The contract ends when the project is concluded. Also, cloud technologies are making it easier for developers to work remotely which makes geographical boundaries obsolete.

Expertise 

Finding specialists for in-house development only in your area can be challenging, especially when you lack the project knowledge yourself. Whereas an outsourced remote tech team gives you access to endless hiring opportunities and huge pools of talent from around the world who have both the knowledge and technical skills to see your project to fruition.

Faster Delivery

Outsourcing eliminates the hassle of attracting, finding, shortlisting, and hiring full-time employees, which means you can start on your project as quickly as possible without delays and the need for additional time for hiring and onboarding people.

Besides, according to a survey by Deloitte, 57% of companies believe that outsourcing enables them to focus on their core business operations, and that’s true. By handing over your development activities to a third party, you can seamlessly shift your focus towards the things that matter the most or which have been overlooked in the past, for accelerated growth. 

Up-to-Date Technology

Remote development teams have a great deal of exposure when it comes to technology since they work with clients from all around the world; everyone with their own tech-stack requirements. Therefore, working with outsourced teams gives you a chance to learn about disruptive technologies such as AI, ML, Blockchain, Cloud computing, etc. You can then use the knowledge to teach your internal teams. Moreover, collaborating with remote teams often involves utilizing time tracking software for developers, ensuring efficiency, productivity, and seamless project management.

CONS

Communication Gaps

The only disadvantage I see is in terms of communication. As mentioned earlier, communication with teams in-house is way easier as compared with teams working remotely. As they are situated in entirely different locations with different time zones. Now, what can you do to ensure the smooth progression of the project and communication?

• The best way forward is to have a single POC or point of contact, responsible for handling all the communication and requirements – usually, POCs are project managers. 
• It’s important to define a single medium such as Slack for all project-related communication.
• Daily huddles or virtual stand-up meetings to make sure everyone is on the same page and also to stay in the loop with the project's progress. 

Is a Mobile Developer an On-Site Job or Remotely?

The answer is very simple: It can be both. It all depends on the personal preference of both the developer and the company looking to hire. You can get an on-site job with the company if that’s what you are looking for and on the other hand, you can work totally remotely if that is what the potential company wants from you. 

Recommended: A QUICK GUIDE TO OUTSOURCING MOBILE APP DEVELOPMENT

Tips to Inspire an Outsourced Team

• Get to know the company to build stronger relationships.
• Recognize their performance.
• Respect their culture.
• Give enough time – be flexible with your deadlines.
• Keep the doors of communication open.

In-House Software Development vs Outsourcing: Who’s the Winner?

‘Do what you do best and outsource the rest' – Peter Drucker

Both outsourcing and in-house software development have their pros and cons, as you can see. But considering the advantages, outsourcing is probably the smartest choice. With just the right strategy companies can fix the communication issues with the outsourced company.

Having said that, outsourced companies may be helpful for short-term projects, but in reality, they are all about building long-term partnerships. The bottom line is –  outsourcing services offer valuable expertise and flexibility. On the other hand, hiring employees for in-house development takes a lot of time and effort. All the time, cost, and effort will go to waste if you are unable to retain your employees in the long run. So choose wisely!

Looking to hire a remote team of developers? InvoZone can help. We offer end-to-end software development services that are customized to fit your needs. 

Our experienced developers and designers will work with you every step of the way, starting with planning, coding, and testing until the launch of your product.

Recommended: A STEP-BY-STEP GUIDE TO OUTSOURCE APP DEVELOPMENT IN 2021

Frequently Asked Questions

What does an in-house developer mean?

An in-house developer is a term used to describe employees of a company who are also responsible for creating and maintaining the code that runs the company's website.

These developers usually have both technical and business backgrounds and are able to collaborate with the rest of their team on strategic decisions.

What does it mean to be a remote developer?

Being a remote developer is an awesome way to work. You get to be your own boss, you have the flexibility to set your own hours, and you can do it all from the comfort of your own home.

But being a remote developer also comes with its challenges—you might not always be able to find remote developers for your team, and you’ll need to learn how to communicate effectively with clients who may not be in the same time zone as you are.

What is the difference between in-house and outsourcing?

In-house and outsourcing are two different ways of getting work done.

In-house means that the company is doing all of the work itself. It's not hiring an outside agency or service provider to do any part of the job.

Outsourcing means that the company hires an outside agency or service provider to do some or all of its work.