How to Transition to a Dedicated Development Team
According to Deloitte’s Global Outsourcing Survey, 70% of companies outsource or use team augmentation to reduce costs. Almost half of them do so to improve flexibility.
However, many businesses are still hesitant because of concerns about quality, communication, and control over the development process.
Let’s dive into the challenges (and some solutions) associated with team augmentation and explore how you can make your transition smoother and more cost-efficient.
Why Hire a Dedicated Development Team?
Many businesses find that hiring a dedicated development team allows them to focus on core competencies while leveraging global talent. Whether you're looking to free up your in-house team for new projects, control costs, or expand capacity, team augmentation provides a scalable solution.
By partnering with a dedicated team, businesses can reduce operational costs and increase productivity through agile processes, which enable faster adaptations and high efficiency across projects.
Key Steps to Transitioning Your IT to a Dedicated Development Team
1. Choosing the Right IT Staffing Partner
Selecting an IT staffing agency is akin to selecting a business partner, not just a vendor. The right partner will have a proven track record, industry expertise, and a network of highly qualified developers. Here are some steps to help ensure a successful partnership:
Define Your Requirements: Outline your project’s requirements through a Software Requirement Specification (SRS). If you lack technical expertise, many agencies can help shape your requirements based on your product vision.
Shortlist Agencies: Compare agencies based on expertise, reputation, and their client feedback on websites like Clutch. Look for partners who have experience in your industry and/or similar projects.
Interview the Team: directly Speak with the potential team members to assess their tech and communication skills.
Heads up: if you’re looking to know more about the differences between developing your product in-house versus working with a freelancer – check out our material on the matter.
2. When You Don’t Know Your Software Requirements
For businesses without internal technical expertise, outlining software requirements can be daunting.
Start with these two fundamentals:
Define Your Product Vision: This gives the agency a broad understanding of your goals and target users.
Identify Target Platforms: Decide which platforms (e.g., iOS, Android, Web) are necessary based on your audience’s needs. You might also want to check out the technological stack of a potential vendor.
If the project is complex, the agency can appoint a project manager to help detail technical specifications, ensuring that the requirements align with your vision.
3. Understanding the Structure of a Software Development Team
A typical Agile software team can consists of those key roles:
- Project Manager/Software Engineering Manager
- Frontend and Backend Developers
- Quality Assurance Engineers
- DevOps Engineer (especially for larger, more complex projects)
- Product Designer
A well-structured team is essential to streamline communication and keep development on track. Small, agile teams of around 7-8 members are ideal, but teams can scale based on project needs.
Addressing Common Scenarios with Team Augmentation For Startups
Hiring a dedicated team from the outset aligns with lean startup principles, enabling you to focus on business strategy while experts handle development.
Instead of managing the entire recruitment process repeatedly for each new hire, partnering with an IT staffing agency provides ongoing access to a pool of global top-notch talent across multiple domains.
Notably, tech startups often face turnover rates of up to 25%, making dedicated teams a cost-effective solution to ensure consistency.
With end-to-end project oversight and management, a dedicated team can ensure that issues are identified and managed before they become real painful business problems, further enhancing operational efficiency, and reducing disruptions.
For Small and Medium Businesses (SMBs)
1. Supporting New Projects
For companies needing to reallocate their in-house team to new projects while maintaining legacy software, a dedicated team can handle routine maintenance and updates, ensuring security and competitiveness.
Transition Tips:
Assign an in-house project owner to oversee operations with the augmented team.
Establish a handover period (1-2 months) where in-house team members assist with onboarding.
Ensure your project owner clarifies coding standards, documentation practices, and team expectations.
2. Streamlining Costs:
The shift to remote work has shown that team augmentation can deliver high-quality work at a fraction of the cost. Companies can save up to 65% by hiring a dedicated team, depending on the location and skill set. When transitioning, offer current team members the chance to become independent contractors, which provides flexibility while keeping experienced talent.
3. Expanding Business Capacity:
Rather than replacing your in-house team, reinvest cost savings from outsourcing into additional development teams. With our clients, we’ve seen this approach support significant growth.
For Small Medium Enterprises (SMEs)
1. Identify Key Roles for In-House Retention: Retaining key technical leadership roles, like a CTO or senior software engineer, is essential for continuity. Even so, there are plenty of vendors very successfully offering fractional CTO, fractional CMO and other fractional roles (sometimes called CTO-as-a-service).
2. Optimize Handover Processes: SMEs often rely on unique, legacy processes, so it’s crucial to document existing workflows, coding standards, and system architectures. Having comprehensive documentation aids the augmented team in aligning with your standards and practices from the start.
3. Create a Phased Transition Plan: Don’t shift all projects at once – we’ve learnt this the hard way with some of our clients. Start by augmenting smaller, non-critical projects, then gradually transition more complex tasks. This minimizes disruptions and allows both your internal team and the new dedicated development team to adapt to new workflows incrementally.
4. Implement Collaborative Tools and Regular Check-ins: Schedule regular check-ins, weekly updates, and quarterly reviews with both in-house and dedicated teams. Use collaborative platforms like Slack, Jira, or Asana for better alignment at all times.
5. Leverage Cost Savings for Strategic Growth:
Team augmentation can free up budget to reinvest in areas like marketing, R&D, or customer service. For SMEs, this approach can be a strategic growth driver, allowing you to expand capabilities without significantly increasing operational overhead.
In conclusion
Every business has unique requirements, but the dedicated team or team augmentation process generally involves selecting the right partner, defining project needs, and planning a smooth transition.
Companies that implement this effectively often report significant cost savings, enhanced project flexibility, and access to specialized skills.
According to a report by Statista the IT Outsourcing market worldwide is projected to grow by 8.48% (2024-2029) resulting in a market volume of US$812.70bn in 2029. Be a part of that growth.