Startups face unprecedented pressure to get their products to the market in a shorter time frame. To complicate matters, founders grapple with digital skill gaps and scarce technological resources. Such a trend is prominent, particularly in the past few years, leading to a surge in IT staffing interest. According to a McKinsey’s survey, 87% of companies face IT talent shortage now or within the next 5 years.
Founders seek to reduce costs while sustaining the rapid delivery of products or digital solutions to consumers. Notably, cost issues contribute to 18% of startups that failed. The competition is stiffer in an increasingly crowded marketplace, and there is no time to lose. However, the IT talent crunch has dampened their efforts, particularly in developed western countries.
Is IT staffing a relevant solution? If so, how can you find the talents you need and onboard them to your team?
In this article, we explore IT staffing services in detail, including the pros and cons of the approach and how to find a suitable IT staffing service provider.
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What is IT Staffing?
IT staffing is an approach to recruiting the right IT talent on short-term or long-term basis to address a company’s goals. Often, the HR department or founders themselves are involved in seeking talented IT professionals for their respective companies.
Demands for IT staffing have grown steadily, with global revenue from IT services projected to hit $1,570 billion by 2027. In 2023, web development leads the chart for top in-demand IT skills, with DevOps and database software professionals as runners-ups. Also, AI/ML specialists and mobile app developers are top talents that companies seek.
That said, IT staffing is not merely about recruiting a couple of software developers to your team. Launching a successful digital product often takes a team of cross-disciplinary experts. Hence, IT staffing might include securing the services of a team of project managers, developers, QA testers, product designers, UX, UI designers, business analysts, and support engineers.
Key IT Staffing Models
With IT staffing defined, I’ll explain how to collaborate with IT talents and ensure they align with your business goals.
For a start, consider the objective of engaging staffing service providers. Most companies do so for these reasons.
- Filling up short-term IT positions in their needs to meet immediate milestones.
- Addressing long-term software development needs, such as onboarding a team of developers.
- Anticipating digital transformation by bringing in talents with skills to meet changing trends and realities.
Then, decide on the IT staffing model that fits your business. I share several popular options.
Mark up model
This approach involves hiring IT talents and paying them above their standard remuneration rate. Companies use this model to incentivize talents for better performance.
Hire-train-deploy model
In this model, the IT staffing company hires and trains software professionals for a specific project. Then, they assign the employees to work on the client’s project while providing continuous mentorship.
Managed services or Product outsourcing
This is where the company delegates recruitment, training, project management, and implementation to an external IT service provider.
At Uptech, when we work with a client on this model. We gather the requirements from the client or create these requirements together with them and assign the team which builds the project from scratch. All the management is done on Uptech's end. Here’s a detailed guide to IT outsourcing if you want to find more details.
Staff augmentation
Here, companies hire external IT professionals to fill up missing skill gaps or expand the capacity of an existing team.
When clients come to us with a request for extra hands, we offer – IT staff augmentation. It means that we allocate people with the required skills to the client's project. The project management and overall process organization are usually done on the client's end in such a case.
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What Are The Available IT Staffing Services?
Once you decide on a staffing model, you must access the appropriate talents. IT staffing companies provide different services that help you in that regard.
Project-based staffing
The company and IT talent agree on the rate, tenure, and job scope for a specific project. Once the project ends, the IT expert relinquishes their responsibility.
Permanent staffing
In this arrangement, the staffing agency recruits IT professionals as full-time employees for the client. As a full-time staff, they enjoy remunerations and perks like other regular employees.
Temporary staffing
Temporary staffing allows companies to onboard IT experts on a time-limited basis. For example, you can hire skilled developers to work on a healthcare app without a long-term commitment.
Contract to hire
If you need more time to consider a permanent hire, this method provides some leeway. It allows you to work with the IT expert on a contractual basis with the option of turning it into a full-time position.
Executive search
Executive search matches companies with senior IT experts to lead teams and projects.
Offshoring
Offshoring, or outsourcing means that you delegate software development and other IT processes to an external agency.
Uptech is an outsourcing & outstaffing company. It means we suggest our clients offshoring services only. We have an experienced team of product managers, developers, designers, and QA engineers who are ready to support your product and help you grow on a long-term or short-term basis, depending on what your business goals are.
Here’s a step-by-step guide to hire an offshore software development team. Check it out!
IT Staffing: Pros & Cons
IT staffing services let you navigate complex software development challenges in a more resourceful manner. However, there are pros and cons to this approach.
IT Staffing Pros
Provides flexibility
When working with an IT staffing company, you retain control over the collaboration arrangements. As the client, you can decide the task, terms, fee, and tenure when hiring skilled latent. Likewise, it’s possible to scale the team size upward or download to meet changing demands.
Access to a wider talent pool
IT staffing services provide access to talents in different regions. This allows you to hire developers with rare skills or experiences you can’t find locally. Besides skill-based hiring, top IT staffing agencies vet their talents carefully, ensuring you’ll get a team of highly dedicated professionals.
Simplify hiring & firing process
Recruitment is expensive as it involves posting job ads, interviewing, shortlisting, and onboarding candidates. Then, the employer must commit to long-term training, benefits, and HR management, which some startups might not be prepared to commit to. Fortunately, certain IT staffing approaches, such as outsourcing or temporary staffing, provide a cost-friendly alternative to getting professional IT services.
Shorten time to market
Startups face tight deadlines to get their products to the market. Often, IT staffing is the answer to their predicaments. Instead of assembling a team from scratch, they hire a dedicated team or outsource the entire development workflow to an external IT staffing company.
Free up resources
Not all startups are heavily invested in IT and app development. In such cases, founders outsource IT processes to an independent contractor, allowing them to focus on core business areas. For example, eCommerce companies outsource their app development needs to us so that they can focus on marketing, logistics, and customer service.
IT Staffing Cons
Cultural & communication differences
Some founders face communication and cultural barriers when working with IT talents in certain regions. This will diminish any benefits they enjoy when resorting to outstaffing. Also, such obstacles may impair efforts to align contracted developers with in-house teams.
Lack of control in hiring
The flip side of IT outstaffing is that you have little control over the recruitment process. Often, the outstaffing agency decides which candidates are shortlisted based on your project requirements.
Potentially expensive
IT outstaffing can exceed your budget if you miscalculate the cost of engaging third-party contractors. For example, hiring a freelance app developer in the US will likely cost more than similar recruitment from Eastern European agencies.
Possible time-zone differences
It’s common when a company decided to hire IT staff outside of their country. What’s more, the IT staffing agency can be in a different time zone. For example, a startup from U.S. hire app developers from Poland with the time-difference in 5 hours. It can be challanging to set up the collaboration but possible.
Here we described 10 most common problems of outsourcing and ways to solve them. Time-zone difference problem is in the list, so check the article out to find how to solve this challenge.
How to Choose an IT Staffing Company: 6 Steps?
You can reduce the downside of outstaffing by working with the right agency. Here’s how.
Step 1 - Identify your needs
Before browsing for potential outstaffing firms, clearly outline your business needs. Are you searching for short-term programmers with specific skill sets? Or to onboard machine learning engineers as part of your in-house team? Depending on your needs, some IT staffing companies might be more suitable than others.
Step 2 - Evaluate their expertise
Not all outstaffing companies offer similar capabilities. For example, some software companies focus on eCommerce development while others are stronger in building fintech apps. Depending on their focus, these IT companies operate with different mixes of talents. Besides skills, it’s equally important to consider the company’s experience working in specific industries.
Step 3 - Perform due diligence
Instead of trusting the marketing pitches completely, conduct background checks on the respective IT staffing firms. Whether you’re working with freelancers or a company offering comprehensive solutions, learn what customers say about them. Visit independent review sites like Clutch to get a fairer evaluation.
Step 5 - Consider the collaboration model
Figure out the best collaboration that matches your business needs. Is it better to augment your team with several IT experts? Or let the staffing agency train and manage talents through the entire project?
Step 6 - Compare cost and value
Ideally, you’ll want to compare several agencies to ensure they provide optimal value at the right cost. Remember, cheaper staffing services are not necessarily the best option. Consider cultural differences, expertise, past works, and other factors that help accomplish your projects.
Step 7 - Determine communication methods
Lastly, ensure you and the IT staffing company share a common understanding of communication best practices. This is essential, particularly if you work with agencies in a different time zone.
IT Staffing Challenges and Ways To Solve Them
Despite your best efforts, you might face challenges before, during, and after onboarding outstaffed IT experts.
Competition for talents
IT outstaffing has become a mainstream solution for solving tech talent shortages. Whether it’s a permanent hire or a contractual developer, various startups are competing for top talents.
Solution: Offer competitive remuneration and perks to attract skilled professionals. Also, cultivate a growth-driven and supportive culture to retain them.
Budget constraint
Some startups operate in bootstrap mode and do not have the luxury of massive funding. This puts them at a disadvantage when outsourcing their development projects.
Solution: Consider working with IT staffing companies that practice a cost-conscious approach. For example, Uptech involves users in the discovery stage to reduce project risks and ensure product-market fit.
Evolving technologies
IT technologies are changing at a rapid pace. Without proper upskilling, IT experts might face challenges keeping up with the latest technologies. This affects your company’s ability to compete in a fast-changing environment.
Solution: Stay up-to-date with emerging technologies and incorporate them into the talent’s workflow. Provide opportunities for your staff to learn, adapt and apply new technologies when developing solutions.
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Why You Should Consider Uptech as IT Staffing Option
Uptech is a design and development company. It’s important to mention, that we’re not an IT staffing agency. We don’t hire people on request for some projects, we don’t train people for some projects in order to fill the staffing needs.
But why should I consider Uptech as an IT staffing partner? You may ask.
As an outsourcing and outstaffing company, we provide such services as product outsourcing and staff augmentation. So basically, there are 2 cases when you can geth the maximum benefit of working with us:
- When you lack in-house resources and need extra hands to develop a product. Opt for IT outstaffing.
- When you lack product expertise and need a product development team (product managers, designers, developers, QAs) to build your product. Opt for IT outsourcing.
Over the years, we’ve helped 150+ companies in various fields turn their ideas into marketable products. Our team consists of multidisciplinary experts, and we practice the Agile development approach to remain flexible and efficient when designing, testing, and improving apps.
As an international IT firm, we address staffing challenges that concern startup founders. We share a similar working culture with the US, Europe, and other English-speaking nations. Our presence span across Asia, Eastern, and Western Europe, providing suitable timezones for our clients. More importantly, we connect startups with skilled talents at a reasonable fee.
Over the years, we were named as a Top Service Provider by Clutch and our team has bagged other awards by GoodFirms and Awwwards, underscoring our attention to clients’ needs and commitment to delivering exceptional work. We’re also adept in different niches, including:
- Fintech software development services;
- Real-estate software development services;
- Healthcare software development services;
- eCommerce software development services.
We designed Aspiration, a socially-conscious financial app from the US. We helped to develop Dollar Shave Club app, GOAT, Nomad, and Eatable – a food-tech company in the field of ghost kitchens from Sweden.
Check more of our cases!
Our user-centric approach, a sound understanding of business goals, and app development best practices allow us to produce engaging apps that solve real problems.
Conclusion
IT staffing has taken center stage as startups compete for talent. I’ve defined IT staffing and provided steps for securing such services. Also, I’ve highlighted several advantages and drawbacks to businesses with such an approach. Still, it’s a viable option for founders to overcome the talent crunch and reach the market quickly.
Talk to our team to learn more about IT staffing.