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A dedicated development team is a partnership model widely used in software development for remote collaboration with a client. Hiring dedicated development team is the best choice for both well-established companies and growing startups.
In this article, I’ll explain what a dedicated team model is, its pros and cons, and how it differs from other team formats. I’ll also share some tips on when to hire dedicated development team, and when it’s etter to look for other options.
What is a Dedicated Team Model?
A dedicated development team is a collaboration model with an outsourced team of developers, where a client and a developers’ team collaborate on a long-term basis. This is one of the most popular collaboration modes, which stands on par with the fixed price (FP) and time & material (T&M) models.
When you hire dedicated teams, you get a team of professionals selected specifically for your business goals. This team resembles an in-house team, who are technically your employees.
However, unlike employees, you don't bother about administrative, HR, tax, and social benefits’ issues with a dedicated team. On the contrary, you can focus on more high-level business issues while your development partners do the rest.
To sum up, a dedicated team model provides you with a hand-selected professional team that is focused on realizing one specific project. Plus, all the administrative expenses are on their side.
How much does hiring dedicated development team cost?
According to the 2020 Global Outsourcing Survey report by Deloitte the top reason (70%) to outsource is cutting costs. Hiring a dedicated development team also gives the cost reduction benefit and here’s how.
The pricing model in a dedicated team is quite simple. Since hiring a team, each employee has a specific hourly rate, and you pay for the number of hours worked. This is basically the one thing you pay for. No extra expenses on renting an office for a team, getting equipment, taxes, paying electricity bills, etc.
In addition, it’s much cheaper and faster to hire a Dedicated software development team than to search for each professional independently with HR team.
Who is in a Dedicated team?
The specific composition of your team depends on your business requirements. Thus, your development team may consist of:
- Front-end and back-end, full-stack engineers, mobile developers;
- UX/UI designers;
- DevOps engineers;
- Quality assurance specialists;
- Business analysts;
- Product managers;
- Project managers.
Dedicated Development Team vs Fixed Price Model
It is often the case that a dedicated team model is confused with the fixed price format. Yet, these two forms match way different business needs.
The fixed price collaboration model is a framework where a client pays an agreed amount of money regardless of the hours worked or job done. This mode best suits the short-term projects with strictly determined requirements and scope of work.
The main pitfall of the fixed price model is the risk of overpayment. Sometimes you cannot precisely forecast the time and scope of work. At any rate, you will have to pay the amount as agreed in the fixed price contract, even though the job may not have been delivered.
The fixed price model will work for:
- Projects with clear deadlines;
- Determined specification;
- Short - term projects;
- When there are no changes planned;
- MVP development.
Unlike fixed-price models, the dedicated team format allows for as much freedom and space for development as you need without overpayment.
Dedicated Development Team vs Time&Material Model
Another format that usually competes with the dedicated team is the Time&Material.
In the Time&Material model a client pays for the actual time and efforts of the team spent while developing a specific feature.
This collaboration model is thus suitable for:
- Projects where requirements can change;
- The market is not thoroughly explored;
- Product market fit is yet to be determined.
While the Time&Material model also gives you the space needed for in-depth research and development, it doesn’t guarantee that you'll work with the same team throughout the project. If some specialists don’t have enough tasks on your project, they can be appointed to some other project.
Meanwhile, the advantage of a dedicated team model is in its dedication. When you hire dedicated development team, you get an exclusively dedicated team for your project that is not obligated to take up other assignments. Well, this is what makes such a team “dedicated”.
3 Signs That You Should Hire Dedicated Development Team
The dedicated team model is suitable for complex long-term projects, which can expand in the future. When your idea doesn't have the product-market fit and needs a discovery stage, the dedicated development team is the way to go.
If you’re an early-stage startup and you’re expected to grow, think of the idea to hire dedicated development team. It’ll let you build a team quickly, save money on the hiring processes and develop the product faster. While your in-house team is left to work on business-oriented tasks, the augmented team does the additional work.
Projects with vague requirements
When your idea doesn’t have the product-market fit and needs a discovery stage, the dedicated team is the way to go. As the discovery stage lays the backbone for the whole development mechanism of the project, it may take months of tests and interviews to finally settle down. The dedicated team model provides time and resources for you to focus on the discovery stage with no fear of overspending.
The dedicated team model is suitable for complex long-term projects, which have potential to expand. To unveil your project’s potential, you need a strong team of developers to support you along the way. Within a dedicated team, you can rest assured that the people you start working with will follow through to the end of the project.
On top of that, let’s take a quick look at such tech giants as WhatsApp. They hired a dedicated team of developers to help them with iOS app. Among other companies using the dedicated team approach are Apple, Oracle, American Express, IBM, Verizon, Amazon, Doist, Automatic, Buffer and 10up.
3 Signs That You Should NOT Use Dedicated Team Model?
Despite the obvious perks, the dedicated team model is not a one-size-fits-all approach. Here is a list of situations when out of two choices to hire or not to hire dedicated dvelopment team, I advice to pick the latter.
Short and Middle-Term Projects
You don't need a dedicated and involved team for small projects with clear and defined requirements. When the work scope is strictly outlined, you need a group of people to execute the tasks set. In such a case, a fixed price model is perfect for short-term projects, while the Time&Material approach is right for middle-term enterprises.
Limited Time and Budget
When your budget for a project is strictly fixed, opting for a dedicated team model is not the best idea. Sometimes you just don't need a full-time designer or a project manager. In this case, a fixed-price model is more than sufficient to deliver the necessary result.
The project scope is fully defined
When you have a strict plan of execution for your project, all features are figured out, and there is no place for compromise, you will want to avoid hiring a dedicated development team. Depending on the scale of the project, you should settle on either fixed-price or Time&Material models.
Why Uptech is a Good Choice While Hiring Dedicated Development Team?
Uptech team has a broad experience of collaboration with a client within a dedicated development team contract. About 25% of the projects we start every year are based on the dedicated team model. Moreover, 25% of projects started with other business models eventually switched to the dedicated team.
Dedicated Development Collaboration: Uptech Expereince
Here's what happens when a client hires us as a dedicated development team:
- Scope estimation. At this phase, we figure out how much work is expected to be done and how many people need to be involved.
For that, a business analysts communicates with a client to figure out his/her needs and wants. Based on that information, business analysts define the project's requirements and determine the project's scope.
There are two possible scenarios in the scope determination:
- The client has a predefined scope. We'll discuss the budget with the client by considering the priorities and estimated or given timelines.
- The client doesn't know the exact scope. We can carry out a discovery stage where we make hypotheses and test them with prototypes' help.
Based on the test results, we analyze whether the existing scope reflects our objectives. If not, we proceed with further discovery and research until we find the needed scope.
- Talent selection. At this stage, we put together a team of skilled and motivated professionals to work on your project. Here are the criteria that we use for selection:
- Profitability - estimated ROI for this project;
- Quality & Service - that Uptech team has the skills and experience to deliver high-quality product and Service;
- Skills Development - the opportunity for the team member to develop skills in the project;
- Morale & Motivation - the psychological conditions to work in this project.
- Scope call. At this call, we discuss the purposes, milestones, and priorities for the client's first sprint.
- Proposition call, where we present a suggested solution, expected team composition, timelines, budget, plan additional research activities, if necessary.
- Kick-off call. This is the point where the team gets a green light and the collaboration starts.The call's purpose is to meet the team (client team and Uptech), discuss who will do what, receive access to the development tools, align the project and business priorities, and set up check-ins.
To sum up, a dedicated team is the best option for projects with many vague requirements: aspiring startups and evolving tech businesses. For such enterprises, who seek long-term collaboration, the dedicated partnership comes as the best fit in terms of optimal cost and selected professionals on the team. With that in mind, you can decide for yourself whether you need a dedicated team.
But if you still have doubts about what kind of collaboration model will suit you best, feel free to get in touch with us. We will choose the approach which matches your requirements.
What is Dedicated Development Team?
Dedicated team is a model for a long-term collaboration between a client and the development team. Within this format a team of developers is focused on a client’s project with the guarantee that no team member will be switched to another project. This is what the “dedicated” part implies.
What Does a Development Team Do?
Depending on the type of the team, the development team finds the product-market fit, builds the UX and UI design, writes the code, provides the quality assurance and maintenance of the product.
How Do You Structure a Development Team?
A typical software development team is structured by specialists with broad skill sets and expertise:
- Project manager;
- Business Analyst;