Pros and Cons of Contracting Software Projects over Hiring a Team

Do you want to create a cost-effective, swiftly installed, high-quality mobile or online software application?

Are you debating hiring an external development team or building your own?

Learn about the benefits and drawbacks of both strategies by reading this article.

Find out what is most effective for you.

Before we start, I think it is important to iron out some things. I’m sure you know what hiring a software development team means.

You would have to hire a project manager, business analysts, UX/UI designers, team leads and others who would work together to create the software you need.

Options When Outsourcing Software Projects

When it comes to outsourcing your software projects, you have two options.

You can give them to a freelancer or a contractor. I know these terms are usually used interchangeably.

But allow me to explain the difference between the two.

Freelancer

A freelancer is a non-permanent, self-employed individual who provides goods and services to various businesses.

These specialists can work for as many clients and projects as their schedule allows.

As a freelancer, you have complete control over your rates, tax payments, and where you work.

Journalists, copywriters, graphic designers, and web programmers are examples of freelance workers.

Contractor

A contractor, on the other hand, is an outside employee who is either self-employed or not.

In the classical sense, a contractor works for a company or an agency.

They report to these agencies’ management and are paid regularly by them.

However, the term may refer to a freelancer in a more modern context.

These are highly competent experts who own their businesses and operate for themselves rather than for an agency and provide specialist services like customer service assistance or IT infrastructure support.

A freelancer can actually become a contract worker.

If, for example, a company delegates a project to a freelancer and the person does such an impressive job, the company can ‘retain’ the freelancer’s services in the sense that any time they have similar projects to delegate, that particular freelancer is who they call to take on the project.

Now that all that has been made clear, we can move on.

Let’s discuss the advantages and disadvantages of outsourcing software projects over hiring a software development team.

Read: How to Manage Software Development Projects Successfully

Advantages of Contracting Software Projects

Lower overall cost

This is a major selling point for hiring contractors or freelancers.

Simply said, it is less expensive.

Sure, most contractors (and the companies they operate) charge significantly higher prices than direct hiring.

You will, however, be exempt from many of the fees associated with directly recruiting the contractor.

Contractors will not expect the benefits you provide to direct hires, such as medical insurance, paid time off, and other programs.

There will be no workers’ compensation insurance, and they will not expect the benefits you provide to direct hires, such as medical insurance, paid time off, and other programs.

Companies also save a lot of money by recruiting low-paid workers from other nations rather than hiring high-paid local software experts thanks to outsourcing.

For example, delegating a project to a Nigerian from the U.S. for $200.

Hiring a software development team in the U.S. will cost way more than that, but that amount to someone in Nigeria is just fine.

Read: How Bespoke Software Elevates High-End Client Management

The Best Option for One-off or Short-term Projects

Hiring contractors may be the best option if you have a massive project requiring additional assistance but a set deadline or objective or if you need help with a short-term project.

If you employ a contractor for a specific project within your company, there will be no shocks or upset feelings at the end of the contract.

Is the project still in progress, and is the relationship still going strong?

It is simple to renew a contract.

Increased productivity

When you employ contractors, you may also benefit from increased efficiency.

Because most contractors bring specialized knowledge to the position, they may start working immediately, saving time and money on training.

Whether hiring a data analyst, software engineer, or business consultant, you can be sure they have a solid set of specified talents you may look for when making recruiting decisions.

Availability

As opposed to hiring a full team, freelancers are overly available.

To hire a full team, you have to put out applications, vet resumes and hold interviews before picking your candidates of best fit.

You also have to hire for multiple positions.

So, if you have found your project manager and frontend developer but have not found a UI/UX designer, the show can’t go on.

However, freelancers make it much easier to find the talent you are looking for.

With large freelance platforms like Fiverr, UpWork, and Freelancer, delegating projects to readily available talent has never been easier.

Read: How to Create a Budget for Your New Business

Disadvantages of Contracting Software Projects

Communication issues

The causes of this issue are several and their effect on the project can be rather severe.

One of these issues is timezone differences.

For example, when a U.S. worker begins work, the rest of the outsourced company’s workforce has already gone to bed, which is a severe issue.

If you can’t handle it, your productivity will suffer greatly.

Another example of a communication issue is when there is misinformation or misunderstanding between the company and the contractor.

In this instance, a company should limit email or text-based communication.

Video calls will allow you to go over all of the key and complex points quickly.

Inconsistent quality

Many employers only use contractors on a project-by-project basis for relatively short-term tasks.

Workers will come and go at a steady rate, which can be inconvenient and annoying.

Furthermore, the quality of work you receive from various contractors may be inconsistent.

Employers who need consistent labour daily should hire employees rather than contractors.

Also, some contractors work with the deadline as the first priority, not quality.

This could lead to the delivery of low-quality software, which the company would have to pay a lot more to fix.

If the poor quality product has already been launched, the company’s reputation would be affected.

Unreliability

This is a big issue. As you know, freelancers work for themselves.

They frequently work on multiple tasks at once.

It is common practice for some of them to take on more projects than they can handle or to disappear without completing a project.

Freelance software developers can produce excellent outcomes, but those planning to work with them should have a backup plan.

Security Risks

In this day and age of data protection, you must use client data with caution.

If you plan to outsource processes that need personal data, you may be jeopardizing the privacy of individuals or jeopardizing the security of your company by disclosing such information to others.

Read: Business Custom Software Solutions to Transform Your Enterprise

So What Should You Do?

Should you consider employing contractors for your upcoming opening?

That depends entirely on your organization’s aims, the nature of your projects, and your company’s culture.

You are the only one who can make this decision; both direct hiring and contractors have advantages and disadvantages.

Conclusion

In conclusion, the choice between contracting software projects and hiring an in-house team hinges on your specific needs, project scope, and organizational goals.

Contracting offers cost savings, flexibility, and access to specialized skills, making it ideal for short-term projects.

However, challenges like communication issues, inconsistent quality, and potential security risks should not be overlooked.

On the other hand, building an internal team ensures consistent quality and reliability but at a higher cost and longer onboarding time.

Ultimately, weigh the pros and cons to determine the best fit for your project’s success.

Before You Go…

Hey, thank you for reading this blog post to the end. I hope it was helpful. Let me tell you a little bit about Nicholas Idoko Technologies.

We help businesses and companies build an online presence by developing web, mobile, desktop, and blockchain applications.

We also help aspiring software developers and programmers learn the skills they need to have a successful career.

Take your first step to becoming a programming expert by joining our Learn To Code academy today!

Be sure to contact us if you need more information or have any questions! We are readily available.