Going back to the office or working from home: IT outsourcing as a thing to consider

Are we going to return to the office or are we staying at home, working remotely? That has probably been the most asked question for the last couple of months. Everyone tries to make some sort of predictions. But it’s still nearly impossible to know for sure whether our future workplace will be a desk near an office window or a table out on a lovely home balcony.

Yet, there is one thing we do know for sure. The pandemic has changed our view on office work a whole lot. Many companies don’t believe anymore that work can only be done efficiently when performed from the office. The survey conducted by the National Association for Business Economics makes our words well-grounded: only 1 in 10 companies expect the full return of employees to the office. That is backed up by Gartner’s survey: more than 80% of companies consider allowing remote work for some time after the pandemic is over. Nearly half of the companies (47%) said they are planning to let employees work remotely full time. And a big number of companies (43%) are talking about flex workweeks.

The numbers are impressive, right?

Such a shift of attitude towards working remotely could not but affect the IT sphere and a constant trade-off between hiring in-house developers or outsourcing services. Earlier, some of the fears concerning IT outsourcing were connected with remote work and the lack of developers in the office. But the pandemic has completely neutralized those fears because now even in-house developers are forced to work remotely. And the real practice has shown that remote work hasn’t made the quality and productivity of work worse. On the contrary, it has increased it because employees now do not need to waste time on such time-consuming activities, like, for example, travelling to the office. Nowadays, some companies tend to go for IT outsourcing as a safer way amid the pandemic and a faster way to scale up their businesses, which works well in both scenarios: when returning to the office or working remotely. 

Before choosing this or that approach, it’s important to take into account all the benefits companies find in outsourcing, as well as all the trials and tribulations they can struggle with. So today, we’ve done the heavy lifting for you and are ready to share a blow-by-blow account of the main pros and cons of outsourcing:

  • Scalability and flexibility. In case of returning to the office after the pandemic, starting with an outsourcing company will allow you to enlarge your team if you need to accelerate the process. You can quickly scale an outsourcing team without hiring in-house developers to move forward much faster. What is more, it’s easier to cut the number of outsourcing developers when there is a need to wrap up a project.
  • Price. You will get reduced costs due to no expenses for recruitment, retention, taxes and other stuff. All these are the things you would have to pay when hiring in-house developers. Moreover, an outsourcing company allows you to scale costs up and down as needed. If your budget must go to other areas, you have the freedom to let the experts go.
  • Greater competence. It’s no secret that it’s difficult to find the right IT expert in today’s marketplace. But as you are not limited by your geographical position, you don’t have to deal with all the trials and tribulations of finding an expert. You can get immediate access to a well-qualified candidate pool.
  • Time. Outsourcing allows your company to minimize mistakes and start application development faster. Thus, you’ll be able to provide a quality, tested software product to your intended users in less time.  What is more, there is no need to spend time on staff recruitment, education and long immersion in the project.
  • Effective solutions. By collaborating with an external partner who has a proven track record of successful collaboration with well-known corporations, you can implement cutting-edge solutions in up-to-date technologies without having to master them by yourself. 
  • Focus on your core business. You can let your outsourcing team be busy with software development while you have an opportunity to focus on the core value of your business. In the long run, this will help your company grow and expand much more rapidly and efficiently. 
  • Going big. Outsourcing can help small companies go “big”. They get access to similar technology and expertise that big companies enjoy. An outsourcing IT service can provide an economy of scale and a cost structure that can allow your company to outperform its competitors.
  • Supplement to your in-house team. Many large-scale companies can enjoy the benefits of having a team of in-house developers. But very often the team members get distracted with some small irrelevant issues instead of focusing on the important stuff. In this case, an outsourcing team of developers can help save internal IT staff precious time. And they can spend it on launching new projects and addressing larger issues.
  • Maintain Compliance. Today, many industries have to meet some compliance standards. It can be easy to fall out of compliance if you are not provided with professional support. This can cost your business significantly. IT outsourcing allows you to focus on your core business while your service provider is busy maintaining compliance with your industry regulations.

Each coin has two sides, and even though the risks of outsourcing are not very numerous, they do exist. Below there are the top 5 cons I can think of:

  • Hidden costs. When starting a collaboration with an outsourcing company, you will sign a contract with the services they will provide. If you don’t have a detailed reporting system, any services not covered in the contract are the ground for additional expenses. Thus, as a result, you can pay more than you thought you would have to.

How can this risk be mitigated? Make sure that you have set up transparent requirements before starting a collaboration with an outsourcing company. Have a thorough examination of prices offered by your IT provider. 

  • Miscommunication. Bad command of English, cultural differences and irresponsible approach towards work can greatly affect the success of the project. What is more, if you go only for a short-term collaboration, your provider might not have enough time to understand all your specific requirements and adjust to your needs. 

How to avoid this risk? First things first, check the team’s command of English and their understanding of your specific requirements. It can be very useful if your outsourcing team is ready to participate in daily stand-up meetings, communicate via Email, Slack, Teams and many other up-to-date apps to discuss any issues that can arise. If engineers are also ready to use some modern control management tools like Jira or Git, it will also help to optimize the processes. Take into consideration a customer-oriented approach and cultural differences. For example, outsourcing developers from Asian countries value detailed and accurate instructions and processes. These engineers tend to go for Waterfall development. Eastern Europe and Latin America, on the other hand, are not very different from the USA and Western Europe, where they choose flexibility and prefer the initiative of Scrum teamwork.

  • Lack of experience in working with remote teams. If you have never worked with an outsourcing company before and don’t have expertise in this field, it can be difficult to establish a process. That is especially the case if your potential IT provider doesn’t have much experience of working remotely as well. 

How to find a way out? Choose a provider who has a proven track record of working remotely, already knows how to work in your time zone, has well-established processes, understands cultural differences, and has all the necessary skills and experience for successful collaboration. Some IT providers can even provide training for your employees on how to work with remote teams.

  • Security issues. It’s normal to feel anxious when you share confidential information about your data, systems, workers, and business processes. After all, if there is some leakage of private data, it won’t take long for some great problems to come to your business. 

How to deal with this? You should take into account whether your potential IT provider has experience of working with confidential data. You should be informed about their practices of data protection. Another good point is to sign a Non-Disclosure Agreement before starting your collaboration. If you sign a Non-Compete clause, you won’t have to be anxious that an outsourcing company will use your system knowledge to build a competing product.

  • Technology dependency. After working with the same vendor for a long period of time, many companies think they’ll become over-reliant on their IT vendor’s skills, technology and experience. And that this will make it nearly impossible to develop software in-house or choose another IT provider in the future. 

What to do about this? You can insist on documenting the process of development and sign an agreement where it’ll be put that you’re an owner of your data and codebase. It can also be useful to find out in advance how difficult and how pricey it is to find an IT provider who uses the same technologies.

  • Monitoring the work and productivity of a remote team. Before the pandemic, some companies were afraid to work with an outsourcing team due to the impossibility of effective control over their work. Now, due to the pandemic, many companies have to think about the ways of monitoring the work even of their in-house developers. Nevertheless, it is important to consider this risk and be able to establish effective control of developers remotely when you can’t see them in the office and don’t know what exactly they are doing at any given time. How can you be sure that they are doing their job as efficiently as possible and not wasting time? 

How to minimize this risk?

First things first, together with your IT provider, you need to establish a clear and transparent reporting system for the project. Such a system will include the lists of tasks and the time spent on them by each developer during each working day. In addition, it is important to hold regular meetings with the remote team within each development stream to understand at what stage of the project they are at the moment. In this case, you get excellent planning and an effective control system.

Secondly, and this is even more important: you need to initially choose a reliable IT company with a good reputation and excellent customer reviews, which will confirm the high quality and productivity of its employees. And also thoroughly check the IT provider’s employees during technical interviews before starting the collaboration.

Wrapping it all up, it’s always up to you to decide which strategy works best for your company. IT outsourcing can become a win-win strategy in a post-covid environment. But you should make sure that together with using all the advantages IT outsourcing can bring to you, you are wisely estimating all the potential risks we’ve mentioned above. That will make it easier to discuss them with your potential IT provider. And subsequently, work together towards their mitigation.