Are you starting a new business? Do you plan on creating your software application to reach a wider audience?
Well, in that case, you have two options: either you choose an in-house development team or outsource it to a third-party company for remote development.
Irrespective of what you plan on attaining, whether a small social media application or an eCommerce application, the thought of how you will bring the idea into reality will help you start the process.
You need a development team for the purpose; that’s obvious! But are you willing to invest in hiring your in-house team, or does outsourcing work for you? You have to think about it.
Don’t worry; this article on in-house vs. remote/outsourcing development will help you clarify your decision-making process. Read along till the end.
In-House vs. Remote Development: What Are They?
Before we understand the differences, pros, and cons of these two development considerations, let’s understand what they mean. If you are starting as a budding entrepreneur, then this understanding is paramount.
In-house development, also known as insourcing, is when you seek software development with the help of experts at your company. It is the approach when you don’t intend to take any external assistance in the development process.
All of the developers you engage in your next big project are hired by you, and they will perform the tasks as assigned by the management. All of the resources used in the development process are offered by your company itself.
The working process of an in-house development team is quite simple because the success or failure of the entire process depends on the experts you have hired. Every member of your team will be destined to play a specific role and obtain the asked results. Developers, testers, project managers, and every other team member will work towards delivering the business’s vision of achieving a set goal.
When you seek remote development or outsource the project, you commission a task to a team outside your company. It is the simple process of employing a third-party team from a different company that offers core development services. Not necessarily a company, but with this approach, you can also hire a freelance development contractor to do the job for you. It saves you both time as well as money.
Due to the widened reach of the internet, it is now very easy for any budding entrepreneur or an established business to find a team of developers to outsource the development project.
When you take this road to develop your products, you are not hiring someone to sit in your office and do the job. Instead, they will do it remotely at their workspace, and their team to deliver you the results alongside other service offerings.
In-House vs. Remote/Outsourcing Development: Advantages & Disadvantages
Now that you know what each development approach means, it’s time to make you aware of the hard reality. Both of these approaches have their positives and negatives. So, to help you decide on what would be best for your development project, as per your perspective and understanding, here are the advantages and disadvantages of both in-house and remote development:
Advantages of Seeking In-House Development
- You Get the Full Control
You have the liberty to train your team of developers with the company’s values and goals. Throughout their time with your company, they will be destined to focus on fulfilling the organizational goals and focus only on the key attributes essential to achieving them.
You can guide them in using your company’s resources towards meeting the company’s philosophy on the development project. Unlike outsourcing, they won’t have deadlines for the development projects of different companies or clients.
- Enables Easy Communication
The best thing about hiring employees for your in-house development team to handle your dedicated company-specific projects is they will be working in your office or headquarters. You will have the flexibility to communicate your needs and expectations face-to-face. It is easier to convey the specifications you expect in the software to your in-house team than to the outsourcing team over the phone or via video calls.
Easy communication with the development team allows you to implement the necessary changes to your project faster. There will be fewer chances of any mistakes due to miscommunication.
- You Get the Flexibility to Pick Your Team
You will spend a lot of time finding the right guys or girls for your development team. This is because hiring an in-house team member is a bigger commitment than hiring any outsourcing firm. The recruitment process will be more filtered, and you will hire only the best candidates from the list of CVs. As development has a good career scope, you are bound to get some good candidates with ideal experience in your workforce.
Disadvantages of Seeking In-House Development
- Too Expensive
Even with all of the perks associated with in-house development, one of the major downsides to this approach is its expense. Suppose you are starting a business and planning on getting software live to initiate a business flow. In that case, it becomes difficult to spare such a big expense on hiring a development team.
Keeping the entire team of developers, testers, and project managers in your team is heavy on the company’s budget. Besides salaries, benefits, taxes, and allowances are also to be paid. The overall cost also includes the expenses of office rent, hardware costs, and software licenses.
- Time Constraints
Irrespective of how strongly you deny it, hiring good employees to work locally for you is a very strenuous job. You will have to post a specific job offer, wait for the candidates to apply, and then take several interviews to finally decide. In the process, you will spend a lot of your active resources on meetings, goal setting, training, etc.
If you don’t have access to a talent base, you will be draining a lot of your time and resources in the recruitment process alone. Following that, you have many more things to do to get the team started with the development work.
- Staff Turnover Issues
One flaw with the in-house development team is the high staff turnover. It will lead to consistent disruptions in the entire development journey. For instance, if the employees decide to leave the organization for better opportunities, the work will be halted until another experienced candidate joins the team.
If not, then the company might need to lay off some of the employees due to budget constraints, which will again delay the overall development process. Thus, completing the development work within the specified deadline will be difficult.
Advantages of Seeking Remote/Outsourcing Development
- Reduced Cost Expenses
When you are hiring a remote development team or outsourcing your project, you will be saving a lot of money that you spend on the salaries of employees, resources, hardware, and others. Moreover, you don’t have to restrict yourself to hiring a remote development team from your region, as you can search for one from a region that charges less on development projects. Thus, you can save a lot throughout the entire software development lifecycle.
- Easy to Acquire Talented Members
When you don’t have to hire any professional for your in-house team, you must review the brand reputation, team expertise, and work portfolio of an outsourcing company to decide if they are talented enough to take on your development project. It just takes a few weeks to find an experienced remote development team compared to months of hiring an in-house team.
- Better Cashflow
One of the major benefits of hiring a remote team revolves mostly around cash flow. With hiring employees for your in-house team, you are bound to pay them a monthly salary. But with a remote team, you can negotiate the payment terms. You can pay half the decided amount before the work starts, while the rest is upon the software being successfully delivered satisfactorily. Thus, this will improve your overall cash flow.
Disadvantages of Seeking Remote/Outsourcing Development
- Unreliable Communication
A fair disadvantage of hiring a remote development team is that you won’t have face-to-face communication. Most communication will be through Slack, email, or other such means. And this adds a scope of misunderstanding. So, there is a possibility that you might request multiple corrections in your final output.
- Lack of Control
With your in-house team, your employees understand your company’s end goal and follow the process as specified. But, with the remote or outsourcing team, you don’t know much about their process or approach toward the development project. Thus, it might lead to some possible hiccups in the long run.
So, this is a clear depiction of in-house vs. remote development. Irrespective of whether you are a new business or an established enterprise, you might need to go online with your different products or services. In that quest, you will need development teams for your software solutions. With these differences and parameters in hand, you can better choose what suits your needs the best.