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The IT market is now growing rapidly, even faster than before the pandemic. According to Statista, in 2021, the global IT industry has been valued at approximately $5 trillion. In the future, growth in this market is expected to continue through 2024 at a five percent compound annual growth rate (CAGR).
Therefore, IT companies should look for ways in which they can compete. To do this, software vendors consider expanding their staff as one of the most rational options for increasing their business. This choice is further facilitated by increasing the supply of specialists in the market.
The global developer population is expected to reach 28.7 million people by 2024, increasing 3.2 million from the number seen in 2020. The trend of increasing the number of IT specialists will continue in the coming years. Therefore, you have a wide selection of professionals in different specializations.
According to Statista
We will look at the key reasons and ways to increase the IT staff. This overview will help you choose the best option that meets your current needs and goals.
6 reasons to extend a software development team
Every company sooner or later faces the need to increase their software engineering team. Many factors can cause this demand.
So, first, you need to identify them and then move on to options for expansion. Keep in mind that several options can approach each cause at once. It all depends on your approach to work and how you see the development of your firm.
Some ways to increase a team can have an immediate effect, but they will only be really useful in the short term. Other ways will not bring results immediately, but they will provide you with successful financial results for many years, and you will have full control over the situation.
Let's look at the common reasons why companies seek to expand their team of software development experts.
Delegation of small projects to focus on larger ones
This situation can happen when the firm has a small team that has long been able to work on projects of various sizes. However, there are more and more customers, and you have started to notice that you can divide these projects into large, medium, and small.
Perhaps, your team is physically barely able to cope with all the work tasks. It affects the mood and motivation of your professionals. At the same time, you are satisfied with the quality and speed of their work, but you want everyone to be comfortable working and not burn out.
That's why you decide to leave big projects to your current software engineers. And you pass all medium and small to new specialists. This approach can positively affect the working atmosphere in the team.
Fast time to market
You may have a situation where your potential or existing customer wants to develop and launch a product on the market in a fairly short time.
You want to take on this project, but you understand that you will not have enough professionals in the team to complete the project on time. Therefore, you choose one of the options for rapid team expansion and start working.
High-quality specialists with lower costs
You want to increase the number of projects for your company through rapid staff expansion. However, you do not currently have the opportunity to hire new employees with the same high salary, but you want them to be high-quality professionals.
What to do in this case? You need to explore the global market for IT developers, as there are regions with first-class professionals who charge many times less for their work than in your job market.
Things can be as good as possible for your firm. Your specialists are satisfied with working conditions and are highly motivated. However, you begin to notice that it would be nice for you to increase your team, gain an additional competitive advantage in the market, and attract new customers.
For starters, you can create a base of potential new employees who are ready to join the work at the first need. At the same time, they work on a project basis, not on an hourly basis. It can help if you realize that you will need to increase the team shortly and you are not ready to spend time recruiting.
And when you find a new customer, you recruit new professionals. For starters, these can be small projects. However, if you immediately want to undertake additional large-scale development, you may need a direct additional dedicated team, which can be hired from another IT company.
If you want to gain a competitive advantage for the long term, then in-house hiring will suit you to set up your extended software development team.
Professionals with new knowledge
The structure of your team consists of specialists who successfully implement projects of various scales. However, the IT market is evolving and changing rapidly. Every year, new technologies appear that need to be mastered and implemented.
Perhaps, your firm won't take on some new projects since it requires expertise that your employees do not have. But you would like to get these projects. Therefore, you need to quickly find a professional with specific knowledge who also has the appropriate portfolio.
You can find a developer with the right skills as a freelancer or among particular companies. However, you would like to have such professionals in your internal team. Therefore, you can simultaneously look for a new employee in the market with your recruiters. And on the next project, you can have a full team that meets the requirements of the IT market.
Research and improvement
You want your company to be one step ahead of the competition. So you understand that you need to spend more time researching the market, following its trends and new technologies. Moreover, you feel that you could improve your services.
So, you are expanding your staff with new specialists who will deal with the above tasks. In essence, this step can be seen as an investment in your long-term success in the IT market.
Your company may face other reasons. We have considered here the typical ones that occur in most cases. So if you have any seventh reason to expand the team, then do not worry. All is well, and it also has its solution.
Four ways to extend a software development team
Now let's move directly to the proven ways to solve your team expansion issues. Based on our experience and knowledge, we identify the following trend options for staff increase:
- Outstaffing agencies
- In-house hiring
- Hiring freelance developers
- Outsourcing agencies
Each of these methods has its characteristics, and accordingly, the pros and cons. They are all viable, but you need to be able to use them properly.
Let's dive into the typical ways to expand the software engineering team. Treat it as a small guide that you can always look at to choose the perfect solution with the maximum benefit for your company.
Extending the software development team by outstaffing is the first and perhaps the most popular option.
It's quite convenient for your firm if you urgently need an additional high-quality developer. At the same time, you do not worry about payments to the new employee as the outstaffing company is engaged in all of it. You are only responsible for the timely payment of services to this firm.
You also need to carefully check the information about the outstaffing company
and understand whether its representatives perform their duties to their
employees. It will help you avoid possible reputational risks. Now let's
analyze in more detail the advantages and disadvantages of this method of team
Pros of outstaffing
- Minimal time to find and attract a new high-quality developer to your projects
- Opportunity to work with a new employee both hourly and on a project basis
- The developer officially works in an outstaffing company. You do not worry about its registration, social package, and payment
- You do not need to allocate a workplace and equipment for a new specialist.
- The employee integrates into your team like all members of your team. You can add it to all your project chats and monitor its operation
- Opportunity to attract an experienced developer from another region of the world with a lower level of payment
You can easily stop working with a new developer
Cons of outstaffing
- A new professional is less motivated to work with your projects because they are not officially an employee of your company. He is an athlete on loan but without the opportunity to become a full member of the team
- A developer may not share your company's values because he will not build his career with you
- The employee may be in a different time zone and not know your local language.
- A new specialist always works remotely, and you will never be able to see them live
- There is a risk of confidentiality breach because an outstaffed developer may work on their equipment
- You need to carefully check the information about the outstaffing company to avoid it
Typical reasons to choose are #1- #6.
This one is a classic way to expand your software development team. It is useful if you work only with employees you can fully control and motivate. You like that you can grow your professionals from scratch by snatching young talent from the IT market.
Such people are committed to their work and your company. And you can clearly understand where your firm is heading, and you have no illusions about the number of your specialists. If you plan to extend the in-house development team, you need to consider the features of this approach.
Pros of in-house hiring
- control the number of projects that a new employee is involved in
- No language or time zone issues
- Your specialist shares the values of your company and sees his career development here
- Saving firm data through the use of corporate equipment and systems by team members
- High motivation in current and new colleagues who have the best interaction compared to all other expansion options
- Each of your employees is a promoter of your company and is interested in its prosperity
Cons of in-house hiring
- Costs of recruiting and training developers
- The long process of finding the perfect new professional. Many different interviews and tests
- Difficulties with dismissal
- High expectations regarding salary and social package
Typical reasons to choose are # 4- # 6.
Hiring freelance developers
Here's a fairly popular option for staff increase, from which many IT professionals can start their careers. And some even consider only this format of cooperation with other firms because such a model allows them to choose projects independently.
This format of cooperation may be useful for IT companies if they need flexibility in choosing specialists for narrow-profile projects. And it's easier to quickly hire a freelancer with the right set of knowledge than to look for a specialist in the team.
When choosing a specialist, study their portfolio, technology stack, and feedback from his clients. It will save you a lot of time and help you pick the best candidate.
Here are three popular services where you can find IT freelancers:
- Upwork. Here you can see the profiles of freelancers: experience, skills, portfolio, job histories. You can post a project with requirements on your page, to which freelancers can respond with their proposals. On this platform you can find specialists for projects of various scales: from small to large.
- LinkedIn. It’s a Facebook-like social network for finding professionals. Here you can also see CVs and portfolios of people who can either look for a job now or just have a profile. People can indicate on their pages what they are looking for. However, there are both freelancers and full-time employees on this platform.
- Toptal. It’s an exclusive network of the top freelance software developers, designers, finance experts, product managers, and project managers in the world. Toptal has rather specific process of freelancers’ selection which helps to find only the most skilled professionals in their field.
Pros of hiring freelancers
- Payment hourly or per project
- Access to high-quality developers from around the world, which may or may not be in your country
- Savings on payment and infrastructure
- No need for training
Cons of hiring freelancers
- High threat of leak of data
- Low control. A freelancer can work with your project and several others at the same time.
- Lack of motivation and risk of abandoning the project
- Possible language problems and differences in working hours
Typical reasons to choose are #4 - #6.
Your company may receive a project that your team may not have time to complete due to other tasks or the lack of the necessary narrow-profile expertise. Therefore, one of the options may be to involve an extended software development team as a service from an outsourcing agency. This firm can be located in a region with first-class developers and lower remuneration. In this case, the outsourcing agency can independently develop the product you need, and you only need to provide it with the requirements.
When choosing an outsourcing company, you should check whether it carries out its projects. Also, find out about its experience in the areas you need. And it is worth inquiring about customer feedback and portfolio. You can have several extended software development teams within one or more outsourcing agencies.
We have gathered for you useful resources for choosing an outsourcing agency:
- Clutch is a reliable platform where you can find an outsourcing agency. Projects and reviews are visible here
- Trustpilot and Glassdoor are for checking reviews
- Goodfirms is for viewing the rating of firms.
Pros of outsourcing agencies
- The outsourcing agency manages its offshore team and worries about the result
- Getting quality projects on time
- Reduce development costs
- No need for infrastructure and dedicated team training
High-quality specialists work on your projects
Cons of outsourcing agencies
- Low level of communication with developers due to the difference in time zones and team management models
- Outsourcing agencies show you only the intermediate results of your project
Typical reasons to choose are # 1- # 6.
Bonus tips on software development team extension
We have also prepared for you some more useful tips on how to augment your software development team. They can also be useful to you.
Offshore dedicated center
You can run a successful IT firm in North America or Western Europe. However, you may want to increase your market share and at the same time save on wages. And you may want new employees to be officially part of your highly motivated company. Therefore, you can set up a dedicated offshore center (ODC), an office branch in a country with high-quality IT professionals, for a reasonable price.
Moreover, a reliable level of data security in ODC can be achieved using VPNs on your employees' computers. At the same time, such specialists have the same knowledge and experience as developers in advanced countries.
You need to realize that you are forming your team in another region. And you need to take into account cultural and temporal differences, legal nuances, and tracking performance.
Optimizing in-house structure
We recommend that you periodically perform a detailed analysis of your firm and development team to optimize workflows. What is it for? For example, you notice that your company's resources are not being used in the best way, and the team's number of tasks and people have not changed. However, there is a need for additional staff.
This approach will help you understand the reasons for the slowdown of the team, and you will quickly find a solution. Moreover, there may be no need for urgent staff expansion.
As you can see, this model does not have any of the previously mentioned typical reasons.
Extend a software development team with Softermii
Extending a software development team in today's reality is an important step for most IT companies. It can improve financial results quickly, increase the number of clients, take projects in new directions and gain more market share.
Despite these benefits of a software development team extension, you should carefully consider which method is better to increase the number of professionals. Your decision should be based on the specific reasons we have considered, your goals, and your vision for business development.
If you want to save money and get a turnkey project without your intervention, we can help you. Softermii has solid experience in various fields as an outsourcing company.
We have such high-quality specialists as Full-Stack Engineers, UI/UX Designers, Project Managers, Business Analysts, QA Engineers, etc. We make sure that our professionals use the latest technologies.
Contact our team, and we will help you implement your projects on time and at a good price.
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