Now that tech companies are becoming more cost-efficient in their development, I see more and more willingness to launch development projects and even entire startups without in-house developer teams. To some entrepreneurs reading this, the idea may seem outlandish. Many might argue that "The developer team is the heart of the company. How can you rely on developers who aren't employees?"
But today's reality is different from yesterdays. Companies and startups need the ability to respond to changes fast and to bring products and services to market quickly. By expanding and shrinking as needed, an external developer team gives entrepreneurs maximum flexibility without having to invest time and resources in hiring employees all the while not needing to resort to layoffs that might damage the company's name and reputation which could alienate future candidates.
In today's competitive and dynamic reality, when the winds of recession are blowing over world economies and the high-tech industry, and when investors and boards are far more focused on profitability and cost-efficiency and much less patient with long and expensive recruitment campaigns, the ability to rapidly recruit excellent developers is vital, and can often make the difference in a venture's success or failure.
True, nobody's prouder that Israeli developers have made a name for themselves around the world and are considered among the best in their field. But does your project really only need Israeli developers? After all, not all necessary company development involves deep technology and complex computation. Moreover, one should ask whether a mix of developers from Israel and other countries might not produce better results. Many times, when you build a team of developers from diverse fields and ways of thinking, it solves problems differently and more imaginatively than a local team ever would.
When should you turn to outsourced development?
In today's competitive market, when tech companies and startups are battling over talent, the challenge of recruiting high-level developers isn't simple at all. Talented workers often prefer the perks and salaries offered by big tech companies, a situation that makes growth difficult for young startups lacking the same economic resources and capabilities. Recruiting an external team of developers can be the solution, letting such startups compete on equal terms. Another situation that occasionally makes recruiting external workers necessary is when tech companies and startups want to carry out development quickly and not suffer the long and tedious process of recruitment. The advantage of hiring an external team is that recruitment can be completed within a few days, compared to the months needed for in-house developers, when at the end of the project, which sometimes takes up to two years, you don't have to terminate them. Furthermore, the recruitment is conducted by another company, letting you save significantly on expenses and resources.
What are the disadvantages of outsourced development?
Such a process must improve coordination with outsourced workers and encourage identification with the organization's mission and goals while exerting less control over the makeup and composition of the workforce that executes the development.
The myth: External developer teams are less available than in-house ones
As with all myths, this isn't true. In just a few days, it's possible to set up an international development and support team able to carry out a 24/7 development process. Because development companies often employ developers from a variety of countries, they can make a team available to you at all hours of the day and night, which can be a big advantage in terms of productivity.
The myth: External developer teams might steal trade secrets
You'd be surprised, but this is also a myth. I've heard many more cases of employees in startups who used the knowledge and skills they acquired to set up similar or competing activities than of independent developers or development companies who did. Software development companies are businesses in their own right. They earn a greater living the more development work they get. A situation in which ideas or code are stolen in favour of profits is usually cut-and-dry from a legal point of view, with many entrepreneurs being very careful not to do so, for fear of damaging investor and customer recruitment.
The bottom line: The road to developing a venture's technology doesn't always come through developer recruitment
If the challenges surrounding development are preventing you from setting out to launch a venture, consider the costs and benefits of outsourced development. Such a service will let you focus more on the business and its development, seize important opportunities, implement the vision and strategy you've built for yourself, and execute your entry into the market.
Today, hundreds of Israeli companies, including startups, make use of external developer teams from around the world. The approach is less popular among the general public, which commonly assumes development processes are only done internally. Yet, the reality in the market is different. At times, the flexibility and versatility offered by external developer teams, and their assistance in solving various problems and challenges, enable many companies to move forward with their mission, save time and money, and present exceptional growth data.
Written by Idan Malul, Co-Founder and CEO of Productive Software