Outstaffing is a topic from which many colleagues in the market immediately start to burn. It is believed that "renting out personnel" is something unworthy, which is not done because of a good life. Most web developer sites do not tell whether they are working on this model or not. But even if they do work, they either talk about it covertly, or disguise it behind some other names - strengthening, team scaling, time & material, etc.
Judge for yourself: on Habrรฉ, we counted 3k materials about outsourcing, custom development, product development, and so on, and less than 50 publications about outsourcing. How is this even possible?
We are one of those who work according to the outstaffing model and declare this openly. Now he provides us with more than half of the revenue. And we love it - there are a lot of advantages here for our business, for customers and even for employees.
In this article, we will try to answer the questions about outstaffing that you ask yourself (and which have already prepared to write in the comments).
- Outsourcing, outstaffing - what's the difference?
- What clients does it make sense to work with using the outstaff model?
- Why do we like outstaff more than outsourcing?
- Why is outstaff more pleasant to the client than outsourcing or in-house?
- In what case is it better for web studios / production not to try outstaff?
Go!
Outstaffing, outsourcing - what's the difference?
First of all, let's deal with the materiel.
Outstaffing is
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In other words, if a client needs specific people with a certain stack for a project requiring constant development, it is easier for him to take ready-made specialists to outstaff. Our role in all this is to be a greenhouse for personnel. Responsible for the selection, training and motivation of staff - creating conditions in which the employee will grow and reveal himself.
If the client does not have minimum technical competencies, does not have a resource for onboarding, setting tasks and monitoring implementation, does not have his own in-house and the desire to dive into all this, it will be easier for him to outsource a piece of work. Management remains on the side of the contractor, and the customer will only evaluate the result without worrying about what is happening within the task.
Outsourcing is a taxi, outstaffing is a car sharing. And your car is an in-house team
Almost any employee can work according to the outstaff model: analysts, testers, programmers, layout designers, designers. For us, these are mainly react-developers - now there is a very high demand on the market for them, which is far ahead of the supply.
What clients does it make sense to work with using the outstaff model?
Our experience says that the business sector does not play a key role here: our teams work with fintech, retail, IT holdings and integrators. We create public services and internal corporate systems with equal success.
The size of the project is also not a determining factor. Outstaff is suitable both for large projects that require constant development (read - endless), and for those when goals are achieved in 1-2 months and the contract ends.
Inga MorozovaBut there are really important points to pay attention to. If at least two points coincide, you can work here according to the outstaff model. Otherwise, it is worth thinking again, will disappointment happen - for both the client and you?
Head of the Globus Affiliate Program
As a rule, the client already comes with an understanding of what model to work with. Large customers from the field of fintech, FMCG, IT in the past few years prefer to keep their expertise inside and choose outstaff work. But this does not mean that some projects are not outsourced - often, according to this model, new projects come to us, new products, within which a huge amount of code has not yet been written. In short, it all depends on the project and the client.
There are IT competencies within the client's company
IT product development is a complex process, and the client must understand how it works. Otherwise, effective work will not work. Even though they have the necessary competencies, few companies can (or want to) put together a cool, combat-ready IT department. There are jobs / areas that, for various reasons, the client does not want to give to the internal development team.
Here is an example from our work: the client basically does not have his own back office and developers, there is only key technical expertise and a product manager who leads the team from an external supplier (that is, us).
What are we primarily interested in? So that the developer is evenly loaded and there is no downtime. This means that the client must have the necessary competencies that will allow him to correctly set and accept tasks. The words "refactoring", "bugfix", "testing" should be clear to both sides so that there are no objections in the spirit of: "Why didn't you write the code correctly right away? I will not pay you to correct your own mistakes. " It's great if there are tech leads on the client side in the same tech stack you are working on.
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Let's say a client has a very large-scale project that requires hiring 30-40 people at one time. This is a real challenge for the HR department. Digital competition will only grow. While some are wasting valuable time looking for the developer of their dreams, others are already rolling out new releases. Or such a situation: the performance of the team is not balanced, there is a lack of certain expertise, because of this, technical debt is constantly growing.
Typical HR who needs to bring 40 employees to a project in 2 weeks.
The need to grow up becomes very obvious when the business processes in the company slow down or additional resources are required, because it is impossible to solve all the problems in time. It is necessary to speed up the workflow, since the launch of the project on time directly affects the development of the business and a quick return on investment.
CEO MediaSoft
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Let's not be the captain - you already know that there is a shortage of personnel in the IT sphere. The formation of an IT department from scratch or its scaling can cost a company a serious amount, so many use the opportunity to use outsourcing services in order to save money. And this is a great reason to start negotiations.
Nikita Shabashkevich
Executive Director of AWG
More and more top companies are building IT cores inside their business, which allows them to keep their competence inside. They have the knowledge of how to manage such projects, they only need additional resources.
A number of Russian and most European companies, on the contrary, most often lack IT competencies, so consulting contractors and outsourcing appear. In such cases, the future is more likely in outsourcing models.
The client is ready to play with more than one goal
At the time of the selection of an outstaff team, the client usually turns on to the maximum: he conducts interviews, checks test tasks, up and down evaluates the quality of the code and the level of horizons of each employee.
But not everyone realizes that after the start of work, interaction with the team should not be interrupted. If the client has a built-in architecture, requirements for the code, then connecting the developer (read - give access to accounting and layouts) and leaving him to deal with this wealth alone will not work.
Some games are hard to play alone
The client must be willing to extend their onboarding system to outside professionals as well as to the inhouse team. Discussing your vision, requirements for approaches, expectations for results, and giving regular feedback is the minimum without which a high-quality result will not work.
Maxim Kravets
CEO Holyweb
Here is an example from our life. Before the release of the rebranding, one large bank set the task of imposing and developing a front-end for an updated corporate website design in a short time. On the third day of work, the customer's team lead completely rewrote the pull request of our specialist for a whole working day. This is a bad practice - this way the developer's work is devalued, which certainly does not lead to mutual understanding.
Why do we like outstaff more than outsourcing?
Dear market colleagues! We have bad news for you (yes, for many it will still be news). If you think you are more competent than your customer, you are a couple of years late. Customer-side product teams and back-office teams are evolving and rapidly increasing their expertise. They are fully able to create, create and achieve results on their own.
The client is no longer interested in your leisurely turnkey development and bloated estimates with inherent risks. Digital products are rapidly changing, and the main thing that is now required is to quickly assemble the required composition of competent specialists for tasks and achieve the set KPIs. There is no time for buildup.
That is why we are actively developing outstaff as a separate line of our business. These are the benefits of this model for the company.
Less chance of getting into trouble with incorrectly evaluating a project by fix price
We all know that evaluating projects by fixing is like walking a tightrope in the dark with a blindfold over an abyss with chiseled peaks at the bottom.
Well, you get the idea.
Underestimate - say goodbye to margin. If you reload, the client won't buy. Outstaff completely removes this headache from us. We earn as much as we work. Our main task is to "match" the expectations of the client with the productivity of the specialist he hires.
Projected utilization and revenue
Outstaff projects are often large and long, and tasks are serious. For us, this means a clear production load plan and a fairly accurate revenue forecast. And not only in the context of the project, but also for each employee.
Saving resources. Getting rid of chaos and entropy
When project management remains on the customer's side, that very part of the body burns for him, not for us. The developer does not need to jump from project to project several times a day, because somewhere โeverything urgently broke down and needs to be repairedโ - he calmly and immersedly works on one thread, does not spend a drop of resources on switching. The main task of management from our side is general supervision of the project and maintaining a good atmosphere in the team.
- Oleg, everything is broken with us!
We gain experience in various fields
Let's be honest: it's much easier to get into cool projects with top clients through outstaff than as a contractor. Our developers have the opportunity to work in companies of any level and gain invaluable experience. It's cool when you can spy on technologies, processes, techniques (both good and bad) and ultimately upgrade your employees.
Why is an outstaff client more pleasant than outsourcing or in-house
Okay, we figured out why outstaff brings profit to our business. Let's now see why the client is interested in him no less?
What does the client want from their contractor or in-house team? The answer is well known: to get more (result, quality, shipped tasks, launched projects) and spend less (time, money, resources).
How will outstaff help him?
Strengthen your team quickly
Less time - more results!
So far, no better way has been invented to scale as quickly and efficiently as possible. The client chooses a ready-made specialist or a whole team that is immediately ready to connect to his project. And disconnect at the moment when the project is completed.
Another case from our life. For two months the company tried to close the position, while the tasks did not budge, and the technical debt on the project grew. They did not believe in outstaffing, and for a long time we knocked over the doorstep to make a deal. In the end, the client agreed to try and gave us a test two weeks. The cooperation has dragged on and has been going on for 7 months already.
Our example showed the client that in principle it is possible to work according to such a model, and he attracted another contractor. True, they did not last long - but that's a completely different story.
We have passed a lot of someone else's legacy code through our millstones. Here is an example of what the customer's team leads sometimes write. And we had time and the code was finalized!
Save money
The same result, but money was saved. It is
difficult to evaluate a complex project from scratch using a fix. The budget will be directly proportional to the number of black boxes on the project - the more there are, the more the contractor re-mortgages, trying to close all possible risks. As a result, even a detailed estimate will relate to the time actually spent on the project about the same as your passport photo for a selfie on Instagram. And most of the time, neither the client nor the contractor likes it.
Outstaff allows you not to burn the budget for the project, but to spend it rationally. Moreover, the client can use the available resources as flexibly as possible, and not waste energy on disputes with the contractor in the spirit of "in the TOR, which we signed six months ago, this was not, and we will not do this."
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Less own resources - but more involvement and initiative.
An outstaffer is immersed in the processes and atmosphere of the client almost as much as his own employee - with the acceptance of all requirements for work methods, corporate culture and work schedule.
At the same time, his motivation - with proper organization of processes and high-quality onboarding - is comparable to the motivation of a full-time employee. As a result, the client has a proactive employee or team that is fully integrated into their processes.
For example, we once assigned a team of six front-end developers to a banking project from Dubai. Two of them became team leaders in their own areas, and subsequently played a key role in the organization of work and onboarding of other specialists. The client highly appreciated our work - so much so that he invited the team to work in his office for a month.
Customer's "office" at the time of development
Of course, it would be unfair to talk only about how everything is going well, and not to mention the risks.
Inga Morozova
Head of the Globus Affiliate Program
If your company has outstaffed team leaders or developers who cover most of the expertise that is important for your company, then there is a great chance that after some time you will lose these developers. And this is a very big pain for the company.
Yes, they are - for us and for the client. But this is a big topic for a separate conversation, and we are already preparing a separate article about them.
When is it better for web productions not to try to go outstaff
And now, finally, when you have already mentally launched a new business process, it is time to honestly answer yourself: are you ready for the fact that along with the new model of work you will have new difficulties?
Here are the obvious stop factors that should make you think a few times if you need it all.
You are not ready to swing the HR direction and support your employees
The main function of management should be recruiting and working with them within the company. Your task is to retain, nurture and cherish your employees, because with a large turnover of personnel within the company, the whole scheme ceases to be working and bring profit.
In addition, there is an opinion among experienced contractors - you should not engage in outstaff if you are not fully responsible for your resources. In other words, if you yourself work with subcontractors.
CEO MediaSoft
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This year's crisis set a new trend - smaller teams and even tighter selection. If your employee does not pass an interview with a client, he is of no value in the outstaff market. Your client is not looking for juniors, but for middles and seniors. Several dozen developers can pass through their interviewers - and against the backdrop of strong middles at the conditional rate of 1800 rubles per hour, you and your jun for 2000 rubles will look like clowns. In the worst case, you will spoil your karma and your developers will simply stop hiring for interviews.
Outsourcing development allows you to balance the team and smoothly grow your developers, while in outstaff it is impossible to cover up incompetence. Are you ready for this? What about your team?
CEO MediaSoft
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We initially started building our team as remote and distributed - and now it is bearing fruit. For more than two years we have improved in interviews on Zoom, and in setting goals, and in control. We learned to maintain the atmosphere - although we have never seen some of the guys from the team live. This approach allows us to collect real diamonds, not limited to one region (and even one country). If this does not suit you, if you do not know how to work with the inevitable risks, and office cookies and a coffee maker are the loveliest things in the world, then think again.
You are not ready to work under an NDA
Yes, this is our harsh reality - a considerable part of the projects are held for us under the heading "top secret". We cannot always place the client's logo on the website or mention it in the case. The portfolio is not quickly replenished with projects, because many of them are not public. Therefore, you have to look for other ways to prove your competence.
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In this article, we have summarized what we currently know about the market and customer needs. They opened the door to their inner kitchen and showed how you can work.
To summarize very briefly, here are the advantages of outstaffing for web production:
- Long and well-predictable developer workload. It can be calculated, it is easy to manage.
- Our team gains versatile experience and pumps at x3 speed.
- We cannot get into trouble with an incorrect fix price estimate - because we do not work on such a model.
And here are the pros for the client:
- The ability to quickly build up IT expertise. Concentration on product goals, not HR routine.
- Deep integration of a specialist into his team.
- Rapid scaling of the team in both directions: if necessary, strengthen, at the end of the project, interrupt cooperation - and no one will be fired.
At the intersection of these advantages, we are building a long-term partnership, raising staff and increasing turnover. And we are not planning to stop!
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We want to continue to share our experience and talk about more practical things. For example, about such:
- How do our guys feel about outstaff? How do we keep our team and why has only one employee left us in two years?
- What are the risks for the client and us? Analysis based on their own rake.
- About interviewing clients. How to prepare, what to pay attention to?
Write in the comments what is interesting to read about, and we will definitely tell you about it. It will also be cool if you share your experience in outstaffing and cases - successful or not at all. Let's discuss it!