Tag Archives: dedicated team model

30 One-line Reasons To Hire Dedicated Development Teams

1. Offers you on-demand transparency, security and flexibility

2. 100% Controlled Execution

3. Enhanced Operational Expertise

4.Competitive price compared to in-house team

5. Access to a global talent pool

6. Faster turnaround time to client’s needs

7. Saves time and money to set up office space and procure equipment for your team

8. In comparison to inhouse teams, it can scale easily

9. Save on the resource cost if you hire an offshore dedicated team from tier 2 and tier 3 countries.

10. You can train your dedicated team to follow your work processes and agency-wide standards.

11. No overhead costs of the dedicated developers as they are on the payroll of the outsourcing agency.

12. Authority to manage the team structure

13. Ability to fit your limited budget

14. Get quicker responses to emergency situations

15. Elevation in performance efficiency level

16. Focused approach with core competencies

17. Great results & organizational transformation

18. A faster-paced development cycle

19. A dedicated team promotes collaboration

20. Highly efficient workflow with a single point of contact- project coordinator

Also Read: How to Set Up Distributed Teams for your Digital Marketing Agency

21.Eliminates the challenge of finding the right talent

22. It provides you with the flexibility to grow or shrink your project when necessary.

23. You pay only for the actual hours required to complete a task

24. Refining domain knowledge

25. Easy replacement if an employee takes sick leave or quits.

26. Eliminating artificial dependencies between projects

27. Variety of communication channels for smooth coordination

28. Use of project management tools to keep track of progress and tasks

29. Decreases administrative overhead

30. Minimized risk with competent project management

Wrapping up

Dedicated development teams are best for any company, startup or established, no matter how large or small. The pre-arranged team of experts is readily accessible for assistance when solving complex business issues.in-house capacity gaps can be readily addressed. Looking for a dedicated remote team? Build your team with Uplers.

5 Dedicated Team Outsourcing Case Studies Every Business Can Learn From

5 Successful Remote Team Case Studies

The trend of remote working or outsourcing has taken the world by storm. As of March 2020, an estimated 16 million U.S. workers started working remotely.

1. JXT- How a Dedicated Team Developed 500+ Websites Within Just 5 Years

JXT is a leading digital marketing service provider for recruiters in Australia. The company leads the market with its custom CMS (Content Management System) for developing websites for their clients.

As JXT moved ahead with its expansion plans, its first approach was to expand its in-house team of developers. However, there were a series of challenges the company encountered along the way.

Major Challenges

Shortage of right talent
Right talent came with heavy investment
Increased overhead cost with inhouse hiring
Freelancing lacked reliability
Retention of employees

Solution

A diligent and dedicated remote team at Uplers was able to help JXT deliver more than 500 websites in just 5 years. JXT is now the #1 digital marketing solutions provider for recruiters across Australia. The dedicated model has helped JXT scale its business and they are currently expanding their business in the USA, UK, and Canada. Read the entire case study- JXT Case Study.

2. Racenet’s Organic Journey to Top 3 Rankings on Google

Racenet is Australia’s premier horse racing destination, providing the latest in-news, form guides, tips, statistics and tools to help punters back more winners. Owned and operated by industry veterans Craig “Clocker” Tompson and Glenn Robbins, Racenet has been the leading online portal for Australian horse racing since its inception in 1998.

Racenet came to Uplers intending to improve their PA (page authority), DA (domain authority) and DR (domain rating). To increase keyword ranking for targeted keywords was the prime focus. Racenet also wanted to obtain as many authority links as possible in order to be ranked well for relevant keywords.

Solution

After reviewing Racenet’s website performance on different parameters, Uplers worked on a strategy to target specific keywords as an anchor text for the relevant landing pages. Once the keywords were ranking for respective landing pages, Uplers started working in the direction of improving the rankings of the targeted keywords.

Result

1. A whopping month-on-month increase of more than 400% in their website traffic.

2. Secured more than 192 authority links in just 12 months.

3. This led Racenet to be visible on the top search queries and secure the first 3 positions.

4. A substantial increase in the PA (Page authority) and DR (Domain Rating).

Check out the full case study- Racenet SEO Case Study

Also Read: Explained! The 10 Most Common FAQs About Dedicated Team Model

3. Weight Watchers – How Uplers Helps Build 60+ Email Templates for WW every Month

Founded in 1963, Weight Watchers (WW International) is a globally-acclaimed wellness technology company. Helping customers overcome lifestyle disorders for over 6 decades, they have inspired millions of individuals around the world with their people-focused & science-backed approach to promoting weight loss and healthy living.

Objective

In 2017, Weight Watcher’s increasing demand for a quality email development partner brought them to Uplers, whose dedicated remote team of experts helped them with Seamless ESP Migration, Email Templates Production and provided Operation Support to CRM team.

Solution:

The dedicated remote team deployed by Uplers consisted of a Campaign manager, Salesforce expert, QA professional and email developers who were available across time zones to assist the team 24/5. The 2-way partnership between WW and Uplers has now grown multi-folds and Uplers is now a dedicated partner for all of their email production requirements.

Check out how Uplers managed to develop pixel-perfect email templates for WW within just 8 hours- Weight Watchers Full Case Study

4. How a Dedicated Team Model Helped Elite Mobile in Expanding their Business

Elite Mobile is the longest-serving and largest UK distributor of telecommunication products and services. Established in 1994, Elite Mobile is considered an expert in the ever-evolving telecommunication industry and distribution field. It works directly with local and large retailers to supply them with SIM cards and unrivaled service. Elite Mobile also has the operational capabilities to deliver end-to-end mobile services to its retailers.

Objective

Elite Mobile wanted to expand its distribution of telecommunication products and services in the UK and around the world. They needed a holistic ERP (Enterprise Resource Planning) Solution which contained all modules like purchases, sales, warehouse, inventory and accounting.

Solution

The team set local development solutions with multiple developer logins and QA server for testing. In addition to this, the dedicated team also took care of maintaining the live server for the site. Everything from maintaining space for the application’s documents to configuring IIS for .Net applications, signatures, PDFs, barcodes, etc. Moreover using task management services the team was able to do some everyday scheduling tasks for Elite Mobile.

Result

Elite Mobile now has over 45,000 partnering retailers, with over 200 field representatives with 3 UK Hubs.
The ERP system was built in a way to manage the sales, warehouse, inventory and accounting, online purchase of the sim cards, transferring of commission, viewing activations and redeeming the points.
Uplers has been serving Elite Mobile for the last 7 years
Elite Mobile achieved the global authentic presence they were aiming for

5. Repeat Booking- Turning a Business Idea into Reality in Just 80 Days

Repeat Booking is an Australian company providing sole traders the ability to add their customers and take automated follow-ups via SMS, reminding them that their service is due. These reminders sent on a yearly or half-yearly basis, provide customers with ease to re-book services.

Challenge

Repeat Booking needed a fully functional user-friendly website with a secure dashboard, wherein the traders could import the list of users to whom the reminders were needed to be sent. They wanted us to create a framework where the customers were able to select between 3 different plans with different price specifications. Additionally, they expected the system to be completely secure and extendable, wherein the admin can view/delete/edit customer’s data safely.

Solution

Dedicated technology experts
Data security
Time-Zone Flexibility
Reliability
Use Case Testing
On-Time Delivery

Result

A dedicated team of experts helped fulfill Repeat Booking’s vision by helping to turn their idea into reality and worked from scratch to provide them with the desired results. The company was able to achieve a significant user base within a short period of time with the help of a dedicated team that worked in their time-zone and providing them with complete flexibility.

Check out the entire development timeline of how Uplers helped Repeat Booking build a system from scratch in just 180 days- here.

Get The Uplers Advantage!

Uplers will help you make your offshoring experience seamless and without any hiccups. After 9+ years in the field, we have helped more than 7000+ clients with their digital, web development, marketing automation and design needs. At Uplers,we provide smart, focused and passionate teams dedicated to your business.

Our process is simple

Tell us your requirements, we’ll help you pick the right talent and create an ideal dedicated remote team.

Connect now.

Explained! The 10 Most Common FAQs About Dedicated Team Model

Outsourcing has now evolved as an independent service sector by itself. Global Business Services (GBS) is the new terminology for the entire sector. An indication of the popularity and growth of outsourcing.

We have adopted this new terminology to refer to all organizations that offer outsourced services to a wide range of businesses.

Background

Cutting costs and access to talent – these are the two primary reasons that prompt businesses to outsource their needs. That is also making one of the various outsourcing models to emerge as more popular than the others.

Clear Preference For DTM

Younger managers are veering increasingly towards a strategic partnership model with GBS (Global Business Services) organizations. This movement towards a more strategic and integrated partnership indicates a rising preference for the dedicated team model (DTM).

The popularity of the one project at a time kind of outsourcing is on the decline.

What exactly is DTM? How does one optimize the business gains from this model? That’s what we discuss in this article. Pretty much everything you need to know about the DTM approach to outsourcing.

5 Best Practices for Managing Offshore Teams Effectively

The proliferation of the digital outsourcing industry in the last ten years itself intensifies the urge to use the outsourcing model as a business development strategy. On average, 300,000 jobs are outsourced by U.S. businesses each year and the global outsourcing industry amounted to $86.6 billion in 2018. Making a headway, businesses, and agencies, today, establish their offshore teams in preferred outsourcing locations like India, Philippines, and China.

In fact, 43% of US IT businesses, today outsource through offshore teams. But, managing offshore teams isn’t an easy sail. Instead, it requires experience and profound project management skills. Furthermore, unorganized management is most likely to result in reduced work productivity and project failure.

The Challenges in Managing Offshore Teams

Scattered Communication Strings
Distributed Business Culture
Lower Project Control
Lack of Well Grounded Trust
Possible Breach in Security

Though offshore outsourcing offers capacious benefits, you need to have the right expertise to tap into this world of opportunities. Here is how to manage teams when outsourcing offshore –

5 Best Practices for Managing Your Offshore Team

1. Know Your Team & Their Capabilities

Lack of face-to-face communication in teams remains a colossal challenge when working with offshore teams. That is where research comes into the picture.

Practice due diligence: Stop being reluctant and do your due diligence. You need to find the best offshore outsourcing location for your business and drill-down to the pros and cons of each location. Drill-down to devise a coherent project scope and screen through quotes to establish a realistic project budget.
Research the right vendor: Connect strings with your preferred target location to scrutinize through recommendations and possible offshore team providers. Assess the technical competency through previous client feedbacks, portfolios and case studies.
Know the staff assigned for your project: Akin to hiring resources in-house you can look at the profiles of the offshore resources assigned for your project. The dedicated team model can be a good idea to establish a better look at your team structure.
Use outsourcing capabilities smartly: Develop a better skill understanding of the individual members when working with offshore teams and utilize it judiciously to gain in work productivity. Defined project scope can further help you plan the availability of your team prudently.

2. Build Partnership and Make it Two-way

Comparable to any partnership, the efforts in the outsourcing world can only be multiplied when they are made from both ends. And to make efforts reciprocate, bonds need to be made two-way.

Focus on communication in teams: Communication is the key when it comes to making bonds two-way. Frequent communications in teams build understanding among your inhouse and offshore resources and help align everyone’s efforts. Don’t limit communications to chats or email channels, instead use voice calls and video calls to bring better clarity over tasks and share ideas.
Share your vision and goals effectively: Share goals, challenges, and vision with your offshore team. Develop trust and brainstorm together to bring your remote team on the same page with your in-house team. Building a sense of ownership among your offshore team will motivate them to work hard for you.
Drop the idea of a one-time deal, instead build partnerships: Unlike the project-based outsourcing, a dedicated offshore team acts as an extension of your in-house team. As you utilize the offshore team for your tasks, you pass over your processes and culture to them and this builds partnership. Working with a team over long-term projects helps build a trust value and understanding which can be utilized to bring recurring projects to success.

3. Sprint Approvals on Your Side

When you outsource a project to your offshore team you are still liable to manage the project and that involves a sense of commitment to the project. The project needs inputs from stakeholders in the form of feedbacks, paths, and approvals.

Faster client-side approvals: A fact seldom spoken is that delays on the client-side are one of the major reasons for poor progress in the project cycle. You can assign dedicated project managers for managing offshore teams, so as to make the project cycle more efficient.
Align stakeholders with project scope: The project scope needs to be comprehensive and detailed. Every query or misunderstanding related to the project scope should be resolved in advance to align all the stakeholders. Moreover, clients need to streamline the decision-making so to eliminate any possible delays on the client-side.
Bring realistic timelines in the picture: On account of drawing a larger margin between project deadlines, businesses push unrealistic timelines for their offshore teams. This hampers the structured project cycle and the quality of solutions. Clients need to do their due diligence to create realistic timelines for managing teams effectively.

4. Make the Right Choice of Engagement Model

The outsourcing model works on three types of engagement models – Fixed Price, Time & Material and the Dedicated Team model. Each model has its own perks and limitations, which suit different businesses differently.

Fixed Price Model: This model suits the best for short-term projects. The service provider quotes a fixed price for the project and the client gets the project delivered according to the clearly defined project scope. This engagement model is less flexible and no major changes in the project scope are entertained. In the case of any additions in the project scope, the extra cost is added and the overall project budget is likely to exceed.
Time & Material Model: The fixed time & material model involves hiring a shared or part-time resource team from an outsourcing provider on cost per hour basis. The client can add new features to the project scope and pay for added hours on an hourly basis. This model is more flexible but has partial control over resource availability.
Dedicated Team Model: For long-term projects requiring the utmost level of commitment and reliability, the dedicated team model is the right choice. The client can build his dedicated offshore team of developers or marketers through the outsourcing partner. Resources are bound by a contract and are liable to serve the client dedicatedly. Be it changing project scope or anytime resource availability this model fits the best.

Source

5. Make Security A Priority

One of the crucial aspects of managing offshore teams is protecting the IP and the project against any security breach. A PWC survey reported that 31% of the total businesses surveyed witnessed some kind of breach attempt while they utilized offshore teams.

Some important security precautions while working with remote teams include:

Sign a strict NDA that is notified by an attorney
Check the networking monitoring settings
Authorized access to systems and project data
No off-site access to critical client data
Sign and seal standard data protection policies

Conclusion

The perks offshore development offers in terms of cost, scalability, global talent, and reliability are without peer, but only if a business pays efforts in managing teams effectively.

The top ways for managing offshore teams include:

Define the detailed project scope and prepare realistic timelines
Research the right outsourcing partner and build a capable offshore team
Know your offshore team and their capabilities
Share your vision and motivate your offshore team to fight for you
Streamline decision-making and sprint approvals on your side
Choose the right engagement model from fixed price, time & material model, and dedicated model
Protect your IP, sign NDAs and establish proper data protection policies

7 Disadvantages of Outsourcing for Project-based or Fixed-price Model

Ever since the phenomenon evolved in 1989, outsourcing has only grown. Today, it is an integral part of business strategy. That is not to suggest that outsourcing has gained universal approval. Opinions about outsourcing travel the entire spectrum from the condemningly negative to the enthusiastically supportive. Though there are some disadvantages of outsourcing, it has some unparalleled benefits for businesses.

Outsourcing Is Here To Stay

Whichever position across the spectrum you hold, one thing is for certain. Outsourcing is definitely not on its way out.

Statista informs that the global market value of outsourced services increased from US$ 45.6 billion in 2000 to US$ 92.5 billion in 2019.

Source

All the surveys by known market research experts inform us that two primary reasons drive outsourcing: cost-cutting and access to talent.

There are several models of outsourcing to help businesses achieve these two objectives simultaneously. Let us examine two of them: the project-based and the dedicated team models.

Examining the Project-based Model

In the simplest terms, the project-based model implies:

You hire a third party for an entire project at a fixed cost contract
You first explain the full project requirements to a third party and double-check that they have got it right the best you can.
Then, you draw up a contract with as many details put in as you can think of, with strict deadlines, and failure punishment clauses.
The hired team is then supposed to finish the entire project exactly the way you want it and deliver it on time.

Seems easy and relaxing, does it? At one level, the project-based model of outsourcing does take a lot of responsibilities off one’s shoulders. However, you may have to pay a rather heavy price for that if you ignore the disadvantages of outsourcing, especially the project-based model.

A Relevant Anecdote: Outsourcing Failure

Hertz, a car rental giant sued the IT mammoth Accenture over a website redesign task that never met its completion. They actually ended up paying Accenture $32 million for a website that never wet live. Hertz is a U.S. organization that operates popular car rental brands including Hertz, Dollar, and Thrifty having approx. 10,200 corporate locations across the globe.

The company faced tough competition against the rising on-demand car hiring apps like Uber and Lift, which resulted in a drop of its stock prices by 85% within 5 years. To this, Hertz outsourced its website revamp task to Accenture in August 2016 and the site was due to go live by December 2017. But there was some delay in the development cycle from Accenture’s end and the due date was delayed to January 2018. But, a second go-live date was requested (April 2018) which was also missed.

By that time, Hertz had noticed that the website revamp task has not even travelled half-way and it isn’t in line with what was planned in the project scope, this caused them to terminate Accenture and the new website never saw daylight.

If you dig this episode carefully, the 7 problems that you may typically face with the project-based model of outsourcing become clear.

7 Disadvantages of Outsourcing for the Project-based Model

1. It’s Never Easy to Capture the Project Details in Totality

It is extremely difficult to think through all the details down to the nuts and bolts of a project before it actually starts. No matter how thoroughly you think, articulate, and communicate – there’s always a chance of missing out on some aspects that do not seem important enough. And most fixed-price agreements relate to this limitation of outsourcing.

2. Possible Gaps in the Understanding of Project Requirements

Communication issues hassle us at an everyday level. How can they simply vanish when trying to communicate complex project needs? And by this, we don’t mean there are no benefits of outsourcing, but communication and management have a significant role to play.

Accenture, too, had accepted their lack of understanding ultimately.

Source

3. No Control Over the Everyday Functioning of the Project Team.

In case there are delays in between, it may be too late before you know. Sudden and unforeseen changes in team members will also remain beyond your control. Lack of control is one of the major disadvantages of outsourcing through a project-based model. And the impact may hurt the project delivery. The onus of putting up a strong reporting process often, unjustifiably, falls on the client’s shoulders.

Hertz couldn’t transparently look into the progress of the project development cycle.

4. Change in Project Requirements will Require Cost Renegotiation

One of the most evident disadvantages of project-based outsourcing model is that you may be in a position where you have to pay what the vendor asks for, or risk not getting it done at all. The contract becomes the sole driver of relationship in many client-offshore team engagements. The solution is, of course, to either keep a favourable clause in the contract or work with agencies that are culturally attuned to the idea of rapidly changing engagement models so as to benefit the client.

5. Project Delay or Crash from the Vendor’s Side pushes you in a Royal Soup

You may penalise them financially. However, your projects will still remain incomplete or imperfect. No way can you estimate just what kind of losses you may have to suffer. The truth is, agencies would rather have their work done in time, rather than impose penalties on their vendors.

Hertz paid Accenture $32 Billion for a website project that was never completed.

6. There May Always be Hidden Costs

To leverage the benefits of outsourcing you need to bear some hidden costs. Such as the time and energy you need to monitor. Whether the project is moving as per the agreed timeline. Is the vendor maintaining the quality standards specified?

7. The Biggest Risk, of course, is Security.

With limited control over the project team, the security of all the company information you have to share with them will always remain at risk. Especially as you will have no direct control on how the vendors maintain their security. This disadvantage of outsourcing persists across various models of outsourcing. However, working on white label contracts with defined NDA and detailed documentation can assure you complete security of your crucial company information.

The Solution: Dedicated Team Model

Quite clearly. Dedicated team model eliminates all the risks that the project-based model presents. You choose the team and retain full control over it.

Source

However, this model also retains the benefits of outsourcing. You get access to global talent and you pay only when the team works..No monthly paychecks to issue when the contract is over and there’s no work.

Also, long-term relationships foster dependability and trust.

Top Factors to Select the Right IT Outsourcing Company

Hiring an overseas workforce to outsource IT services? Expect benefits like:

Lower overheads
Focus on core business activities
Better service quality
Faster growth
Rapid releases
Ongoing innovation

Source

All in all, it’s a win-win for your business’ bottom line!

The thing is, not all IT outsourcing companies are the right fit for your projects. For example, an outsourcing service provider specializing in staff augmentation cannot handle digital marketing engagement. Always select the right outsourcing partner and the right model of outsourcing. This will bring long-term business success.

The right choice can drive competitive advantage. But in an industry with global market size of $92.5 billion, that’s easier said than done. That’s why due diligence is necessary. Find outsourcing service providers that cater to your segment and have the necessary expertise and resources.

Top Factors to Consider When Selecting an IT Outsourcing Company

1. Meeting Your Scalability Goals

Scaling up your business’ internal team is expensive and time-consuming. You must hire new people, create new offshore remote teams, and develop new policies and procedures. Your IT infrastructure must grow too.

Outsourcing IT services provides an on-demand team at a fraction of the cost. Here’s how remote teams help your business:

Build new infrastructure as required
Track and manage infrastructure
Free up other teams to focus on growth, sales, customer engagement

Outsourcing, thus, offers unmatched scalability along with flexibility.

No wonder 43 percent of US companies outsource IT jobs. The right outsourcing IT company allows business managers to schedule staff effectively. This reduces cost-per-project and helps agents work efficiently.

Therefore, the right outsourced service providers have the staff and size to ramp up quickly. This is handy when project volumes spike during major marketing campaigns or seasonal activity.

2. The Model of Outsourcing You Wish to Go With

Outsourcing engagement models vary depending on two primary factors:

Distance
Client-provider relationship

These are not mutually exclusive. Rather they are two perspectives framing various types of outsourcing engagements. Find out which of these suits your requirements the best:

Location-based Types of Outsourcing

Distance defines location-based outsourcing models.

Onsite Outsourcing- The provider sends qualified professionals to work in your office. Think of it as outsourcing implemented onsite!

Onshore Outsourcing- Businesses outsource IT services to providers in the same country but outside the company.

Nearshore Outsourcing- Outsource digital services to providers in nearby or neighbouring countries. Providers share the same time zone with clients.

Multisource Outsourcing- Simultaneous location-based outsourcing engagements from various service providers. Enterprises and corporations use this model to ensure every need is sourced to the best provider.

Relationship-based Types of Outsourcing

These models describe the balance of responsibility and ownership between outsourcing service providers and clients.

Staff Augmentation Model- Businesses handle the bulk of the responsibility. They lease workers from outsourcing IT companies for internal development projects.

Dedicated Team Model- Clients share responsibility for and ownership of outsourced projects with the provider. Both parties decide upon the responsibilities beforehand.

Project-based Model- The outsourcing service provider bears the majority of the responsibility. They handle projects as per your requirements.

3. The Best Outsourcing Location

Know the location of your preferred IT outsourcing company. Consider the following factors:

The practicality of regular meetings for deployment support and knowledge transfer
Immigration rules
Ease of communication via video conferencing
Time zone difference
Round-the-clock service capability

Depending on your business needs, choose the best outsourcing location from:

Eastern Europe

There are more than 1 million developers in Eastern Europe. 42 percent are based in Ukraine and Poland. These countries provide highly-skilled digital professionals. This can be attributed to high-quality education and good English. The cultural affinity with European governments supports business development.

Ukraine- This European country has one of the fastest-growing IT sectors. There are more than 105,000 developers. The capital Kyiv is an industrial hub.

Poland- Poland offers more than 118,000 tech specialists and has decades of outsourcing experience. Most professionals work in Krakow and Warsaw. Expect great service at a high cost.

Asia and Middle East

These regions offer many IT outsourcing service providers at low hourly rates. The time difference is significant. Also, communication issues are common. This is due to minimal cultural affinity and low English skill.

India- India is the biggest country for offshore outsourcing with more than 25 years of experience. There is a huge pool of marketing and tech specialists. Experience ease of the business process and cultural compatibility.

China- China has stepped up its game, both in political and business environments. The region offers decent services and skilled developers.

Latin America

It is an attractive IT outsourcing destination for US businesses due to geographical proximity and low fees. Latin American providers also encourage collaborative teaming.

Mexico- Reasonable service costs and a well-educated growing workforce make Mexico a good choice.

Argentina- The European-influenced culture of the region makes Argentinian professionals easy to work with.

Also Read: 5 Best Outsourcing Countries to Outsource Web Development Services

4. Intellectual Property Rights and Patents

Privacy and data security are important for your business. And you need to share sensitive information with the outsourcing partner when you outsource IT services. But, without proper management, your data may be mishandled.

Sign a nondisclosure agreement with your preferred IT outsourcing company before sharing sensitive details. Also, hire a vendor who regularly conducts security and network audits in the workspace. Ensure they use the proper tools to safeguard your intellectual property and prevent data leaks.

Never sign contracts prematurely. Check whether they benefit only one party. Also, pay attention to the jurisdiction and governing law applicable. Hire a local lawyer if necessary to protect your business interests.

Consider one of the four approaches for intellectual property in outsourcing:

Client has all IP rights, agency has license
Agency has all IP rights, client has license
Apportion of different rights to both parties
Joint ownership

Keep in mind joint ownership is considered the least safe option. Be ready to negotiate.

Make sure the agreement defines exit strategies and repercussions for breach or infringement. Dispute resolution clauses like disaster recovery plans and insurance coverage. The agreement must also take into account all improvements and modifications during the relationship.

5. Company Processes and Communication Standards

IT outsourcing companies must have a benchmark of quality service. They should support your business’ mission and values. If necessary, ask for their KPIs and quality assurance measures. Assess whether they are sufficient to meet your requirements.

Ensure they understand the scope of your business. Ask questions like:

What is my business need?
What can be the best solution?

These will identify the problem you are solving. Decide your business goals and convey the same to your agency. They will decide the best possible solution to achieve your desired goals.

Do not share vague requirements. Always be specific in terms of what you wish to do. After all, communication is the soul of business. Communicate your ideas clearly with the agency and management. Make sure you receive constant updates on projects. Also, ask to be kept in the loop about the tools used for communication.

Main Reasons Why Outsourcing Fails

The right outsourcing company will promote clear communication. They will filter your messages and emails to the right people in the agency. They should also communicate seamlessly without language or cultural barriers.

6. Costs and Expenses

59 percent of business leaders do not consider cost the main driver for outsourcing. Their main priority is to focus on core business aspects and solve issues with capacity.

But saving money is still a priority. Nearly 45 percent of businesses outsource IT services to save money. Also, 46 percent claim outsourcing helps them access skill sets not available in-house.

Tech and marketing firms normally benefit from outsourcing due to reduced costs. Most digital work that is outsourced ends up in third-world countries with an educated population. Outsourcing professionals here charge less than first-world counterparts. Rates are paid hourly or by the task, based on the conditions agreed upon by both parties.

7. Resources and Technology

Many businesses outsource IT services to improve their business model while minimizing capital risk exposure. Outsourcing providers design systems composed of different frameworks and processes.

But ensure your preferred agency has the right tools and equipment to cater to your needs. Avoid hampering your project due to lack of resources.

Technology plays a key role in the success of tech and marketing outsourcing models. Pay attention to the technology used by the company. Ensure it ticks the right boxes:

Meets the latest industry standards
Easily accessible
Mobile-ready

It is also a good idea to enquire about the agency’s future technology and resource policy. This will be crucial for your growing business.

In a Nutshell

An experienced IT outsourcing company helps your business make better decisions. They tweak strategies to improve areas where your business practices are ineffective and outdated.

Aside from the points mentioned above, there are various other factors that help you select the right outsourcing service provider. Pay attention to industry knowledge, quality assurance practices, and project planning and management. Remember parameters may vary based on the location of the outsourcing service provider.

So, never make spontaneous decisions. Give yourself sufficient time to consider every possible factor before choosing the right outsourcing company.

5 Real Struggles and Disadvantages of Offshore Outsourcing

Quick Summary: This blog discusses why offshore outsourcing is failing for some businesses and what are the major struggles and disadvantages of offshore outsourcing. First, there are some statistics that show a drop in total IT outsourcing revenue from 2019 to 2020 and then there are some real struggles businesses have witnessed with offshore outsourcing. But we do not conclude here and we give the most perfect solution to make offshore outsourcing productive and so away with the listed struggles through dedicated teams.

It’s frustrating, we know.

Outsourcing promised the world to global companies, only to reveal that there were pitfalls hiding under what seemed to be a smooth road surface.

Here are some routinely cited challenges CxO’s face with offshore outsourcing key departmental functions.

Before that, Some Numbers:

The total contract value of ITO across the globe decreased from US$76.6 billion in 2019 to US$66.5 billion in 2020, informs Statista.
A 2019 article mentions that many large multinational companies (MNCs) are moving away from outsourcing to global in-house centers (GICs).
The British outsourcing market crashed by 25% in 2018, indicating the burgeoning distrust of the model across geographies.

Why’s that a Bad News?

Because companies that have had their hands burnt while trying outsourcing models are finding it hard to nail down the true cause of failure:

Is it the offshore outsourcing model that’s failed?
Or, is it the lack of control inherent in the traditional offshoring model, that caused the failure?

Source

By saying NO to offshore outsourcing, they’re failing to pinpoint the cause of failure, and as a consequence, foregoing the tremendous benefits of offshore outsourcing.

We could fill out pages if we were to go into the reasons that make offshoring lucrative for companies.

There are some inevitable benefits that make the disadvantages of offshoring fade away:

Increased competition in a globalized market has big businesses searching for offshoring their IT needs to keep costs low.
For many industries, offshoring is an avenue of competitive edge.
The talent shortage is also a factor fueling the ITO market.

These advantages of offshore outsourcing are too good to ignore, which means global leaders need to address the challenges posed by the traditional offshoring model and overcome them.

Here, we present the real challenges a majority of companies face with managing offshore teams and their offshore company partners. We also provide a solution, of course!

Top 5 Disadvantages of Offshore Outsourcing and their Solutions

1. Limited Control over Shared Resources

Sharing resources, including proprietary business knowledge, is necessary for any outsourced project.

Offshore IT outsourcing is not beyond that. But the headache level is different when dealing with the advantages and disadvantages of offshoring.

How do CxOs deal with this, traditionally?

You will try to develop a watertight contract, of course, believing that to be an adequate guarantee against the unauthorized use of shared resources.

However, with your offshore team working at the other end of the world, your control of the shared offshore resources will remain constrained.

The 2013 Trust-wave Global Security Report (2013) studied 450 data breach investigations and found that 63% were linked to a third-party component of IT administration.

It will be difficult, if not impossible, to detect data leakage. There may be sufficient damage by the time you detect it. In the case of shared resources involving data protected by privacy regulations in your country, the challenge increases manifold.

By design or by mistake, your offshore team causes a data breach. Can you even begin to think about how drastic the impact could be for your company?

Solution

You need to sign a White Label contract with strict NDA terms and have your documentation complete. With this, the best solution for managing security while offshoring is by hiring a dedicated offshore team, so you know your exact team structure and can identify the resources working on your project. This gives you the same level of transparency as your inhouse team.

2. Frustrations with Managing Offshore Teams

One of the major offshore company benefits is supposed to be the reduction in overhead costs. But what about the exasperation overhead?

Here are some examples:

Chances are that your offshore company follows business and management processes very different from your own.
Time zone differences and linguistic and cultural barriers make matters worse.
Expect friction around documentation standards, nomenclature, level of detail, etc.

Here’s an example.

Think of something as simple as an invoice.
Your company needs the invoice from your offshore team in a particular format.
Your offshore team insists that they do their invoices in a different format and they see no reason to change that.
They may also say that any change in their invoicing format will land them in legal trouble.

For all you know, you may need several email exchanges with one or two Skype calls thrown in to sort out just this simple thing. Can’t you imagine how exasperating that can be?

You thought one of the best advantages of offshore outsourcing would be to offload most of your responsibilities, did you?

Solution

Yes outsourcing your project requirements to offshore teams help you cut down the operational expenses and sometimes if you outsource to a country like India you can get good IT expertise at a lower cost as compared to your in-house team. But, management can be a hassle and it is a good idea to hire dedicated experts offshore or a team of dedicated experts, who would be managed according to your project priorities and can work according to your time zone.

You would be amazed to know that 80% of the Fortune 500 companies have their dedicated offshore development teams for cutting down on their operational costs.

3. Limited Control over Offshore Team Structure and Functions

With an offshore company partner, you have no control over the offshore team structure, or over how different functions are allocated to different team members. Staff retention is also an issue. The remote team manager will have the full right to shift around team members.

How’s this a problem?

You may suddenly discover that one team member you could best communicate with has been allocated to a different project.
Worse still, you may receive an email informing you that your offshore team leader is no longer working for that company.
With no idea about the capabilities of this new person, you’ll naturally worry about what impact this change might imply for your project.
Combine with that the need for you to establish a rapport with a new person just when you thought you and your offshore team leader have started to speak in the same language.

Doesn’t seem to be a very inviting situation, does it?

Solution

Decide your team structure and team members yourself by choosing the dedicated team model. You can choose the number of members, the expertise level and can transparently build your own team offshore. As you choose the dedicated team model, the outsourcing vendor cannot change your team size or structure and the resources allocated will dedicated work on your project. You can manage them as easily as your in-house team and get great expertise at almost half the cost of your in-house resource.

Does this sound a fair deal now?

4. Lack of Transparency in Pricing, Resulting in Overcharging

Management processes of your offshore partners could be rigid enough to disallow any such mid-project scalability.

In fact, this is a major value-leakage for traditional outsourcing contracts, with key issues such as:

Keeping teams top-heavy to inflate billables by compromising agility
Low potential for upskilling people to enable internal promotions

Your offshore team leader may argue that the hike that seems unreasonable to you is something they cannot do without if they have to get extra human resources for your project.

With little control over the team structure and functions, little knowledge of the employment rules in that country, you will be in a difficult position to negotiate too much. And this can be a hidden disadvantage of offshoring.

Solution

The fixed-price model or the traditional project-based model fades the scope for flexibility or scalability in project requirements once the project cycle begins. And therefore brands have started utilizing the ‘dedicated team model’ where they have the power to change the project priorities, alter its scope and manage the offshore team and resources according to their business priorities.

5. Lack of Control over Day-to-Day Work

When working with an offshore company, you will have no access to the daily activities of the remote team. You may feel that your project progress is slower than you had expected. You may certainly share your concern and ask for an explanation.

But you’ll be compelled to accept whatever explanation your offshore company provides. With no visibility of day-to-day work, you will be in no position to figure out what exactly is wrong.

And that’s like being in a room with a spider; you know it’s there, you just can’t see it.

Combine with these the other typical disadvantages of offshore outsourcing like an urgent communication being delayed because of time zone differences. Or the cultural difference that makes you feel your offshore team leader beats about the bush far too much while they may think you are downright rude.

There are certain apparent disadvantages of offshoring. However, developing a GIC is not feasible for every company. What, then, is the solution?

Solution

Sometimes the nature of your project requires you to take a look at the day-to-day work progress or there may be issues like delayed timelines or a deflection from the actual project scope. And therefore a better choice would be to hire a dedicated team where you could not only transparently look but manage the day to day activities of your offshore team. This could help you earn the expected productivity from your offshore teams and keep you informed about the progress in your projects.

We Recommend The Dedicated Team Model

No, we are not blind to the advantages of offshoring ITO. We are not asking you to give up on offshore ITO altogether. We are not proposing that you do everything in house, which will undoubtedly increase your overhead costs considerably, among other things.

We are proposing a dedicated team model, which combines the top benefits of offshore outsourcing with the top advantages of having an in-house team. And, it eliminates the disadvantages of both! The dedicated team model offers the ideal cost-effective solution for your ITO needs.

Employee Retention Issue in the USA, AU and UK

According to the Stanford Center on Longevity Study, employee retention issue wasn’t a big concern 30 years back. Most people used to maintain the same job for years long and were more engaged with their job. However, the business landscape has changed drastically over the years. According to the U.S. Bureau of Labor Statistics, the average tenure of U.S. workers today is just 4.4 years. Moreover, the younger the employee, the more likely he is to switch between organizations.

The Center for American Progress reports that the average cost of hiring a new employee to fill the void created by an old employee is over 20 percent of the person’s annual salary. This could be millions of dollars for some companies.
Moreover, a survey from the IML Staff Retention Report says that the average cost of rehiring resources in Australia costs around $23,753. Poor staff retention is one of the main reasons why Australian businesses are facing substantial financial losses.
The proliferation of employee turnover rates isn’t just a concern in the USA and Australia, but the scarcity of the right talent and the poor retention rate costs UK economy almost £63 billion a year in the total lost GDP. This fades the growth of various startups and small businesses in the UK.

The Rising Employee Retention Issue in the USA

About 3 million people in the U.S. switch their jobs each month.
A study on 1,000 U.S. workers reported that about 31% of them opted to quit their job within the first six months.
About 40 million Americans opted to quit their job in 2018, this represents 26.9% of the total U.S. workforce.

The Rising Employee Retention Issue in Australia

Approximately 15% or 1.8 million Australian workers chose to quit their job in 2018.
67% of Australian employers reported an increase in the staff turnover rate within the last three years.

The Rising Employee Retention Issue in the UK

41% of recruiters in the UK are facing challenged due to the high employee turnover rates.
33% of UK employers reported difficulties due to poor employee retention rate.

The statistics certainly hint the rising concern for employee retention problems in the US, UK, and Australia. But what are its causes and ways to curb the issue?

Reasons for the Increasing Rate of Staff Turnover in the US, UK, and Australia

The cost of earning a comfortable livelihood in the USA is growing higher each month and this leads the older US workforce to delay their retirement. This fades the growth opportunities for junior-level employees. 11.7% of employees quit their job due to a lack of growth in an organization.
The rising U.S. economy is another factor resulting in poor employee retention rate. According to the US Department of Labor, in 2017 the number of job openings exceeded the rate of hires. This gave a boost to the job quit rate as employees were able to find better opportunities more easily. It displays the shift of the crown from the heads of the employers to the heads of the workforce.
The number of remote jobs is rising in the US and 1/3 US workers would prefer to quit their job for good remote working opportunities.

The majority of the workforce today is Millenials, and according to the Multiple Generations @ Work survey, 91% of Millennials are likely to switch their jobs within 3 years.

Possible Solutions to Resolve Employee Retention Challenges

1. Provide Employees with a Path to Hone Their Skills

Kevin Griffin, the former CIO of GE Capital said, “Learning cannot just be an afterthought — it must be a core focus of any strong organization.”

Research from the Consumer Technology Association (CTA) reported that high-skills training along with voluntary communication training is among the top factors for retaining employees.

2. Keep Employees Actively-engaged with your Vision

According to a survey, 54% of employees who felt actively-disengaged with their company said they would opt for a new job if they got a salary increase of about 20% or more. On the other hand, the employees who felt more engaged with their job and the organization, the number came down to 37%.

3. Find a Promising Alternative Solution

A majority of businesses switch to outsourcing to escape the hassle of in-house recruitment. Outsourcing projects to a white label service provider can be one solution, but this isn’t the right choice in case businesses want more control over their projects. Instead, a business can opt to build dedicated remote teams or hire dedicated resources.

How Dedicated Team Model Can Curb the Growing Rate of Employee Turnover

More than 50% of businesses globally are facing challenges in retaining their prime employee groups. The dedicated team model can help businesses build dependable resource teams outside their offices, maybe offshore.

How It Benefits Businesses and Agencies?

No Employee Retention Challenges

When you hire a dedicated team of experts from an outsourcing provider, the team works on the payroll of the provider and he is liable to retain his employees.

Leveraging the Right Control

Akin to the in-house resources, the dedicated experts follow your work processes and task flow. It makes the dedicated team model a promising alternative for the in-house model.

Access to Committed Talent

Hiring offshore dedicated resources from developing countries like India, which has a comparatively lower staff turnover rate can help you retain the best talent longer.

Lower Cost of Hiring New Resources

The increasing issue of employee retention along with the rising average cost of digital experts in the US, UK, and Australia can affect the financial health of businesses. While businesses can hire dedicated experts from countries with lower economy rates at as less as 50% lower than the in-house hiring costs.

To Conclude

Today, 87% of HR leaders consider employee retention as a critical issue for the next five years. With this, 25% of the total US workforce is considered under the high-retention-risk category. Keeping your employees engaged with your company’s goals and vision is one solution to curb the fading rate of employee retention. But businesses need to utilize promising solutions like remote teams and the dedicated team model to keep pace with the ever-growing business competition.

Top 3 Outsourcing Business Models for Digital Agencies

The Deloitte Global Outsourcing Survey 2018 claims that traditional outsourcing has already yielded to disruptive outsourcing. Cloud computing, robotic process automation, and cognitive automation are driving the disruptive IT outsourcing market. An increasing number of companies across industries are adopting different outsourcing business models as a strategy for competitive advantages.

No data is readily available about the total volume of outsourced digital marketing services. However, the global trends in information technology outsourcing (ITO) offer some insights. Digital services outsourcing falls within this larger market.

What’s in this for you?

Well, we begin by providing market facts about the ITO and the risks associated with the various types of outsourcing business models. We’ll also present an overview of different outsourcing business models to outsource digital marketing services, complete with their comparative advantages and disadvantages.

The Global ITO Market

ITO constitutes the largest component of the wider outsourcing market. In 2017, 727 ITO deals were signed globally for the total value of US$ 137.2 billion, according to a KPMG report. Another 220 deals worth US$ 94.2 million combined ITO and BPO (business process outsourcing).

ITO Market: Australia

Australia tops the country ranking in the Asia-Pacific region in terms of the total contract value of ITO deals. It signed 39 ITO deals in 2017, with an additional 3 deals that combined ITO and BPO.

The total value of the ITO deals was US$ 3,562 million, and that of the combined deals was US$ 57 million.

ITO Market: UK

The UK was second in 2017 in terms of total ITO and BPO deals generated, contributing 5.2% to the global value of deals, informs the KPMG report. The country signed 90 ITO deals in 2017 for the total value of US$ 8,359 million.

The country also signed an additional 30 deals that combine BPO and ITO for the total value of US$ 338 million.

ITO Market: USA

The KPMG report informs that the USA generated 84.2% of the ITO-BPO contracts in 2017. The country signed 320 ITO deals that year, the total contract value of which was US$ 102,817. The country also signed 178 ITO-BPO combined deals for the total value of US$ 94,343.

IT talent shortage is the major factor driving the high ITO rate in the USA. The prediction is that US universities will be able to cater to only 30% of the specialist IT jobs that will be available in the country in 2020.

Risks Involved in ITO

Even while the ITO market is growing, it is not free of risks. The following diagram presents the risk perceptions by firms practicing ITO, as captured by the Deloitte report. The diagram also depicts how companies that outsource their digital services are addressing the risks associated with the practice.

It becomes clear from the diagram that data security breach is the highest concern of major firms practicing ITO. While some companies emerge as not yet focused on addressing this risk, most players have adopted different measures to minimize their concern in this area.

The 3 Most Popular IT Outsourcing Business Models

1. Project-Based Outsourcing

The project-based outsourcing model of digital services implies that there is a predetermined goal that the outsourced partner must achieve within a mutually agreed time frame. This model works best when the project requirements are clearly defined and the development time is short.

Advantages:

This model makes the service provider responsible for the major part of the goals to be achieved.
This approach is also suitable for smaller companies since no long-term investments are necessary.

Disadvantages:

The hiring company has little control over the team formation and the management of the entire project.
Project-based outsourcing business model usually costs higher than other models.

2. Outsourcing to Freelancers

It is possible to use individual freelancers to outsource white label digital marketing services instead of partnering with a company. The decision to hire a company or a freelancer usually depends on the project size. For low-scale projects, hiring freelancers may prove to be more cost-effective.

Advantages:

Freelancers are less expensive if the project is small, for a limited time, and does not need a wide skills-set.
It is easier to terminate a freelancing contract than a contract with a company in case the freelancer cannot match up to the needs of the project.
It is possible to hire different freelancers for several small projects with a short time limit.
Experienced freelancers with a good project completion record need little time for understanding project needs.

Disadvantages:

References for freelancers are more difficult to secure than for established companies.
A freelancer’s goals may not align with the goals of the hiring company.
If a freelancer asks for a rate revision mid-project, it may cause serious problems for the hiring company.
A freelancer is the only contact point, which may become a challenge in the case of differing time zones between the hiring company and the freelancer.
There could be a language barrier problem.

3. Dedicated Team Model

This model means hiring remote service providers who remain dedicated to the provider company but report directly to the hiring company. The remote digital marketing service providers may constitute the full digital marketing team of the hiring company.

Also known as the IT team augmentation model, the remote digital marketing service providers may also work in collaboration with an in-house team of the hiring company. The dedicated team approach works best for long-term needs with changing needs.

Advantages:

Full control over team members and project management.
There is scope for changing the project priorities whenever necessary.
Ensures dedicated service without the need for micromanaging employees.
A point person is always available for any kind of urgent communication.

Disadvantages:

The providing company can decide on shifting remote team members without informing the hiring company first. The solution is to make the process the superstar, so that there’s no ‘indispensable superstar’ that everyone has to rely on.
In the case of any failure, the responsibilities have to be shared by the hiring company and the company providing the digital marketing service.
Time zone differences and language barriers could be challenging. The solution is to design work shifts such that the client gets 24 x 7 support.

In a Nutshell

Each of the three outsourcing business models is applicable to both onshore and offshore outsourcing. Onshore outsourcing means hiring the services of a white label agency situated in the same country as the hiring company. Offshore outsourcing means hiring a company beyond the national borders of the hiring company.

Increasingly, however, more companies in the global North are moving towards offshore outsourcing business model, for their digital marketing needs. Cost-saving and access to talent are the factors driving this trend. The dedicated team model works best for the medium and long term, because it allows everyone the time and motivation to build robust and quality-focused processes.

The Best 5 Alternatives to Freelancers

Quick Summary: This article begins with discussing the popularity of freelancing model and why businesses prefer to hire freelancers. As you read more it unveils the reasons to find better alternatives to freelancers and lists the Top 5 Alternatives. The article helps you make an informed choice by offering you the pros & cons of each suggested alternative and concludes with a recommended solution.

Almost 30% of Fortune 500 companies are hiring freelancers through Upwork. Moreover, the number of freelancers grew by 7%, from 53 million to 56.7 million in just 5 years. Freelancing is one of the most popular business models and meets a major part of outsourced requirements. But, one of the biggest drawbacks of freelancing for businesses is lack of reliability.

Do you think, lack of reliability is the only drawback of working with Freelancers? Let’s read more!

Why do businesses work with freelancers?

Lower Cost: Cost of hiring in-house resources in tier 1 countries is way high and therefore, businesses opt for hiring freelancers in tier 2 and tier 3 countries. This helps them save a huge amount of investment in resources.
Wide and Diverse Pool of Resources: Freelancing helps businesses explore resource options across the globe. This helps them meet diverse potential and find the right resource at a cost-effective price.
Ability to Scale Quickly: Unlike, in-house resources where businesses have to plan long-term payroll budgets and overhead cost budgets, freelancing gives businesses the opportunity to hire part-time resources. Businesses can scale quickly and meet urgent requirements easily.

What is the need to find alternatives to freelancers?

Lack of Reliability: Freelancers are self-employed individuals specializing in various technical skills. These individuals work on remote jobs from clients and are not bound to the payroll of any service provider. This makes their reliability and commitment a concern for businesses.
Juggling Among Multiple Projects: 76% of freelancers work as part-time freelancers to be able to earn extra money. This creates a question on their accountability towards a project or client. And as a fact, 70% of freelancers juggle between two to four projects simultaneously.
Security Concerns: There are no standard security parameters and contracts when working with a freelancer. Outsourcing through well-trusted sources is less likely to breach a company’s intellectual property.
No Long-term Commitment: Businesses and agencies generally hire freelancers to leverage the cost-cutting benefits of outsourcing for temporary short-term projects. There is always a need for a more reliable alternative to freelancers.

Top 5 Alternatives to Freelancers

1. Build an In-house Team

The most popular hiring model is the in-house team model. This model offers maximum trust and can be adapted by almost all business types. However, it lacks the benefits of outsourcing.

Pros of In-house Team Model

Maximum Trust and Security: Each business has its set of custom processes, intellectual property and private client data, which is prone to leaks if outsourced to freelancers. Therefore, the in-house team offers maximum data security and privacy.
Long-term Solution: In-house team model offers long-term solutions as the resources are less likely to switch jobs frequently. Furthermore, having an in-house team allows businesses to create standard skills and practices which are easily transferable across the company.
One-to-one Management: Any other communication channel like chat messenger, calls, or video conferences can replace the efficiency of face-to-face communication. In-house team model helps businesses employ one-to-one management and skill training.
Focus on Quality and Culture: PayPal depends on its in-house team for delivering the best quality solutions to businesses worldwide. The in-house team model help managers focus on the quality of the solutions as the team is well-aligned towards the company’s goals and values.

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Cons of In-house Team Model

Scarcity of Talent: The in-house team model doesn’t allow recruiters to look for talents offshore and therefore they need to look for the right talent within a limited radius.
High Resource Hiring Cost: Cost of hiring the right talent in tier 1 countries like the US, UK, and Europe is far higher than in tier 2 and tier 3 countries. This impacts the growth of businesses with lower investment potential, especially startups.
Higher CAPEX Cost: Hiring a team in-house means added infrastructure cost, electricity cost, and office-level internet costs. Additionally, the employer is liable for overhead cost benefits like employees’ health insurance and meal expenses, etc.
Recruitment Takes More Time and Effort: Hiring resources in-house means long-term budget planning and therefore it takes efforts in finalizing the right resource for your business. 83% recruiters believe hiring resources in-house is tough.

2. Outsource to A White Label Agency

White-label service is a model of outsourcing in which a service is sold under the name of the client’s brand but are executed by the white-label service provider. Like other types of outsourcing, this is a popular model for agencies who wish to reduce their operational cost (increase their profit margins) while steadily increasing their client base. The model is counted among the best alternatives to freelancers for B2B clients.

Pros of White Label Service Model

Reduction In Operational Cost: 59% of businesses utilize outsourcing as a cost-cutting tool. Agencies look for white label partners in tier 2 and tier 3 countries, to cut down on the operational costs.
High Scalability: Outsourcing services to a white label partner can be the right bet when aiming at urgent scalability goals. Outsourcing to countries like India and Philippines gives access to a wide and skilled resource pool, which makes scaling easy.
Focus on Business Development: Following the footsteps of outsourcing, white label services give you a wide room to focus on your core business activities. When you outsource projects to a white label partner, it is accountable to meet your project requirements. Meanwhile, you can focus on your business development goals.
Secure and Reliable: White label agencies follow strict NDA norms and make sure the shared data is secure. Unlike the disadvantages of freelancing, the client here deals with a trusted business entity and therefore there is a very low risk of a security breach, abrupt project abandonment, or project failure.

Cons of White Label Services

Scope of Misunderstanding: As you pass your project vision to a white label agency, this vision travels a long loop of individuals including the sales executive, the project manager, and finally to the execution team. And the project information is likely to distort at some point in this loop. This creates a room for misunderstanding and repeated feedback.
Low-level Control: Antonymous to in-house team model, a white label agency works with its own standard processes and team structure. You as a client have low-level control over the processes followed and can only take a look at the reports and deliverable. Based on these you can give your feedback for a desirable outcome. You need to overcome some disadvantages of outsourcing to crack the white label outsourcing model.

3. Hire A Dedicated Team

The ‘dedicated team model’ is a type of outsourcing structured such to help businesses build their offshore dedicated teams at a white label agency. Businesses having well-defined goals or long-term projects can hire a dedicated team from their outsourcing provider. This team is on the payroll of their parent company (outsourcing provider) but works dedicatedly on the projects of the client company. This model basically combines the values of in-house team model with the top benefits of outsourcing. Read its pros & cons to understand better:

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Pros of Dedicated Team

High-level Project Control: The client can manage the team-structure, the process followed and even the time-zone for the dedicated team. A project manager can be hired to better manage the execution process.
Long-term Commitment: A dedicated team is generally signed under long-term contracts and the same team can work for you on all your ongoing projects. This saves the efforts on skill training and avoids issues related to resource transition. The reliability makes it one of the best alternatives to freelancers.
Decrease In Overhead Costs: You build a team without investing in the infrastructure cost, electricity and office-level internet cost. Further, you as a client are not liable to pay overhead costs for your dedicated team.
Lower Operational Costs: The most common reason why businesses adopt the offshore team approach is to reduce operational costs. Building dedicated teams in tier 2 and tier 3 countries earn businesses a huge profit in the resource cost.
On-demand Scalability: A client gets total control over the offshore team structure and can add members to its dedicated team on-demand. Choosing an outsourcing provider with a large resource strength will be a smart move here.

Cons of Dedicated Team

Not Beneficial for Short-term Projects: Unlike freelancers, a dedicated team is hired under long-term contracts. The model offers access to resources with long-term commitment and the resources are not allowed to juggle between multiple projects but are committed to working for a dedicated client.
Scope of Coordination Gap: Offshore development comes with an attribute of cross-culture gap and it may take some time to completely set the seal on this gap. However, some outsourcing service providers allow dedicated clients to visit and provide on-site training to their dedicated teams.

4. Hire A Shared Team

The shared team model is similar to the dedicated team model but with less control. In this model, clients have part-time access to shared resources. Here the shared team works on two to four projects from different clients simultaneously.

Pros of Shared Team Model

Lower Resource Cost: Hiring offshore resources gives businesses access to a wide talent pool at a cost-effective price, especially if the shared team is hired from tier 2 or tier 3 countries.
Managed Project Flow: The client can manage his shared team and the project flow authoritatively. He has control over the team structure and team productivity.
No Overhead Cost: When hiring a shared team, the client is not liable to pay for the health insurance, travel expense or meal benefits for the members as they remain on the payroll of their parent company.
Main Team Members Can’t Be Replaced: The shared team model comes as a combination of a dedicated team and shared team. Therefore, the dedicated or the main members of the team are under a long-term contract and cannot be replaced.

Cons of Shared Team Model

Limited Resource Availability: Resources under a shared team offer part-time services to a client and juggle between 2 to 4 clients at the same time. This model doesn’t offer clients the same flexibility as the dedicated team model.
Loss In Productivity: Having a part-time resource team under your management has some challenges with the management and there is a scope for loss in productivity.

5. Build A Remote Team

As another popular subset of the outsourcing model, a remote team model is where businesses hire remote resources to set up their dedicated remote team. The remote resources specialize at their work and offer great productivity at affordable costs. It offers all the benefits of outsourcing and can be ranked just below the white label and dedicated team model.

Pros of Remote Team Model

Access to a Large Talent Pool: The Gartner survey states 22% of CIOs find trouble in finding the right talent in-house. The remote team model helps businesses connect and hire the right talent from across the globe.
Lower Resource and Overhead Costs: Remote team model is advisable when looking for offshore experts at lower costs. One can hire remote developers and marketers for as low as $15 – $20 per hour in India. The overhead cost per remote employee is almost negligible as compared to an in-house employee.
Superior Control Over Project and Team-structure: The remote team works on your payroll and you can manage the remote team structure and project-flow authoritatively.

Cons of Remote Team Model

Credibility Issues: Some remote workers can be self-employed individuals who are not answerable to a resource provider. However, the remote model is far more credible than the freelancing model.
Communication & Cross-culture Gap: A remote team with resources from different diversities and culture may display a cross-culture gap. Communication gap is evident in this model.

Conclusion

No denying that outsourcing to freelancers helps save cost, meet urgent requirements and meet the right expertise, but the model still lacks credibility. A majority of freelancers juggle between multiple projects and aren’t committed to a single client. This establishes a crucial need for more credible alternatives.

The dedicated team model and white label services top the list as the most efficient and credible options. On the other end, no hiring model matches the credibility of the in-house team model. Cost-saving, credibility, management, communication and security are the top factors to consider while a business explores the possible alternatives to freelancers.

Top Factors that Hint Your Agency Needs a Dedicated Team Offshore

Right now, your digital agency might be losing 20-30% revenue every year, just by missing out on the benefits of offshore development.

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The business outlook has changed and it welcomes outsourcing as a possible alternative to the in-house team model. But, does outsourcing promises the same quality as your in-house team? Survey says, 50% of employers still doubt the quality of the services outsourcing offers.

Here, the solution is ‘dedicated team model’, it represents a perfect harmony between the benefits of in-house team model and outsourcing.

What is a Dedicated Team Model?

It is a kind of outsourcing where you hire a team of experts from a specialized IT outsourcing agency and the team is dedicated to working on your project. This model fits ideal for long-term projects and business goals. You as a client can train your team and manage them to follow your work processes, while the resource provider confirms the reliability of their resources.

A dedicated offshore team can help businesses save their overhead costs, meet their scalability goals and grant offshore development benefits. But, does your digital agency need a dedicated team?

Top Factors that Hint Your Agency Needs a Dedicated Team

1. In-house Resource Hiring Cost Exceeds Your Budget

59% of businesses use outsourcing to reduce the cost of their operations. In tier 1 countries like US, UK and Europe, the cost of hiring resources in-house is way high. A better bet is to build a dedicated development team in tier 2 or tier 3 countries.

An average cost of hiring a developer in the US is $70 – $80 per hour, while you can find a resource with commendable expertise at the cost of $20- $30 per hour in India. If you plan to scale your digital agency in terms of resources, the dedicated team model can help you with faster scalability along with saving on the CAPEX and overhead cost per employee.

2. You Need a Backup for “Oh Shit” Situations

A dedicated development team can be a faster backup to your ‘oh shit’ situations. In case, you wish to expand and meet the bulking project requirements, a dedicated development team can act as an extension to your in-house team. 80% of Fortune 500 companies utilize offshore teams as a backup to their in-house teams.

Also Read: In-house Team Vs Remote Team Vs Dedicated Team: Which Is The Best Choice?

3. Freelancing and Remote Team Lacks Reliability

Hiring freelancers can be the most uncertain bet when it comes to outsourcing. The model lacks reliability and can cost you a project failure.

Hiring a dedicated offshore team from a trusted IT outsourcing agency gives you a sense of reliability and stability.

4. Long-term Projects with Constant Workload

The dedicated team model can be the right choice when you have long-term projects and business goals. Unlike outsourcing, you can manage and train the dedicated development team to work according to your business processes. Having an offshore team for long-term helps business owners avoid issues related to resource transition.

5. You Need a Team As Efficient As Your In-house Team

As said earlier, the dedicated model makes up as an extension to your in-house team. You can roll-out your agency-wide standards to be followed by your dedicated team. Moreover, the model gives you the freedom to manage your team as per your work processes and maintain the quality standards as your in-house team.

The graph shows the advantages of the dedicated team model over a remote team and in-house team.

Factors to Consider as You Add a Dedicated Team to Your Arsenal

So, as you realize the need to hire a dedicated offshore team, what should be the next step. Below are the factors that guide your decisions while you hire a dedicated development team for your distal agency:

1. Define Your Goals and Project Scope:

A dedicated team befits for long-term projects and you need to have a clear vision about how you are going to utilize your team. A defined project-scope helps you analyze the experience and expertise you need. Team strength is another factor to be added to your list of considerations.

2. Sort Your Priorities:

Think upon whether you need a PM to coordinate and manage your dedicated development team or you need to manage the team yourself. Further, you might need a professional consultation to get into the nitty-gritty of the dedicated team model.

3. Search the Right Vendor:

Check which country would be the right place to set up a dedicated development team. According to a survey, India is the top offshoring destination across the globe.

In the A T Kearney Preferred Location list of 2019 also, India ranks first with a total index score of 7.06.

Shortlist the potential vendors and check who could offer you access to the right talent pool. You need to negotiate between the shortlisted vendors based on their experience, specialization, and strength.

4. Choose Your Team:

Many vendors give you access to the resumes of the dedicated resources and you could simply build your team through a series of checks. Or the IT outsourcing agency could help you build your team based on the level of expertise of each resource.

Summing Up

The dedicated team model renders businesses a backup to their in-house team at an affordable price. Moreover, businesses can easily manage their team structure, create on-demand additions in the team and count on its team as a reliable asset. However, the cross-cultural gap between the in-house team and the offshore team can be evident for some time. Further, if you require any assistance in building your dedicated remote team for web development or digital marketing services, connect with us.

In-house Team Vs Remote Team Vs Dedicated Team Model: Which Is The Best Choice?

The changing landscape of IT outsourcing has revolutionized the way businesses operate. The vital need to find a quintessential alternative to the in-house resources has given rise to offshore teams. In 2019, the global market size of IT services offshoring amounted approximately $92.5 billion. Furthermore, there is a momentous growth recorded in the digital offshoring value every year. But, does it mean a step back for the in-house team?

Source

The business arena hints transition from the regular in-house vs outsourcing game. The Remote Team model and the Dedicated Team model are other promising contenders to keep an eye on.

The fleeting growth of IT services offshoring market from $45.6 billion in 2000 to $92.5 billion in 2019 is evidence of the fact that businesses are ready to leverage the alternatives to the in-house team model. But, does that mean that remote and dedicated teams are better options than the in-house team model? Let’s open the book of facts & reasons.

The main sections of the article include:

1. In-house Team Model

What it best fits for
Pros & Cons

2. Remote Team Model

What it best fits for
Pros & Cons

3. Dedicated Team Model

What it best fits for
Pros & Cons

4. In-house Team Vs Remote Team Vs Dedicated Team: Comparison Table (Exclusive)

In-house Team Vs Remote Team Vs Dedicated Team Model: What to Choose?

In-house Team

What is In-house Team Model?

This model simply means utilising your in-house team for your projects. This is the most common model as it offers the CEOs maximum trust. A team that shares your vision and business goals. There is no better challenger in this game if your in-house team has the right skill-set.

Best Fits For?

‘All business types’ – Simple as it may sound, be it start-ups or large enterprises, every business type can have their best bet on their in-house team unless the team fails to deliver the right expertise and meet the company’s desired efficiency. In that case, in-house vs outsourcing comes into light.

Successful IT leaders, PayPal, Salesforce and Amazon depend on their in-house team for their development solutions. But, we have a list of pros & cons below to analyze which is better outsourcing or inhouse.

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Pros of In-house Team Model

Intellectual Property is Sheltered

Every business has its individual business processes, client data and intellectual property that if leaked is likely to cause the business a loss in its reputation, revenue, or client base. That is where a business can confidently depend on its in-house team. Amazon leverages its in-house team for most of the development tasks to protect its development secrets.

Building Skills and Constructing Transferable Standards

Every business invests time, efforts and a certain amount of revenue in training its in-house staff for the right skillset. These skills are transferable in-house and can be utilized to build functional standards across the company. These standards can be followed by a new set of employees and the company saves on the training cost of new employees.

Seamless Coordination and Efficient Management

The efficiency of face-to-face communication and seamlessly assisted operations cannot be compared with any other digital communication standards. The in-house team gives managers the right platform to polish their management skills, draw great productivity and offer quality solutions. Conversely, remote team management has been a challenge for businesses. And PayPal extensively depends on its in-house team to offer the most superior quality solutions and products across the globe.

Encouraging Personal Participation and Profound Team Ethics

Other than the sense of accountability, there is always a sense of pride when working on your company’s project yourself. This develops a sense of loyalty, as employees feel more involved and influential with the project. The feeling gives rise to superior work ethics and team spirit.

Better Accountability and Planned Budgeting

‘Accountability’, certainly the first concern that shoots up the brain of every business owner when he considers drawing a line between in-house vs outsourcing. It goes without saying that the in-house team model offers better reliability than the remote or dedicated model. Furthermore, the business owner has a say in the salary of his/her in-house resources and can efficiently plan long-term budgeting.

Cons of In-house Team Model

Long-term Overhead Costs

Every business is liable to prepare payroll for its in-house employees. The in-house team model generally offers long-term employment and the business is responsible to pay for its employees’ health insurance, extra-time benefits, meal and travel expenses, etc. Moreover, the added infrastructure cost and employee retention cost, add up to the investment.

Lacking the Right Expertise

Certain geographies face a scarcity of the right talent when it comes to certain skilled business operations. Furthermore, most businesses excel in a single niche, which fades the versatility. This leaves businesses with the obvious option of offshoring. 83 Percent of recruiters have to invest an extensive deal of efforts in sourcing the right talent in-house.

Scalability Requires Much More Time & Effort

Hiring the right talent in-house for a long-term basis requires extensive efforts and time from the recruitment team. The process can extend from weeks to months and doesn’t meet your urgent scalability goals.

Paying Way Too Much

In tier 1 countries including the US, UK, and Australia, the cost of hiring skilled digital resources is way much higher than tier 2 and tier 3 countries. This may be due to the scarcity of the right talent or the high economy of tier 1 countries.

Remote Team Model

What is the Remote Team Model?

A remote team model is defined as a type of outsourcing in which businesses hire several remote resources to build a distributed or remote team. So here, these are skilled resources with great expertise, and available at affordable costs. They work remotely and are dedicated to a client or business on a long-term contract basis.

Also Read: Exclusive Research on Why Remote Working is the Future of IT Industry

Best Fits For?

The model is preferred by clients who have a well-analysed project scope and progress with a clear vision of investment. Other than the cost benefits, the remote work model renders a well-proportioned list of benefits for a business.

Source

Pros of Remote Team Model

Increased Productivity

A remote team can increase work productivity by as much as 13% as compared to the in-house team. 2/3 of employers, report some increase in the productivity from their remote team as compared to the in-house team.

Negligible to No Upfront Cost for CAPEX

“Office space is not cheap and start-ups need to find ways to save money, especially in the early days,” says Savage of GoShare. Costs like office furniture, electricity, business-level internet and other infrastructure facilities can be saved when opting for a remote team.

Access to a Large Pool of Resources

Employers who invest in building remote teams are open to hiring talent from around the world. Owing to the scarcity of the right talent in a specific location, businesses prefer to opt for the remote work model. As the Gartner survey reports, 22% of the CIOs are unable to find the right skillset in-house.

Finding the Right Expertise at the Best Price

When seeking for talent to join the remote team, employers look for candidates independent of their location. This allows employers to hire resources from tier 2 and tier 3 countries, allowing them to leverage the lower resource cost benefits as compared to tier 1 countries like the US, UK and Europe.

Reduced Overhead Expenses Per Employee

A survey of 2018 reports, an estimated $5 billion in the upfront cost for U.S. companies who hired remote teams (part-time and full-time). With the remote team model, an employer is not bound to bear the cost of health insurance, extra-time benefits, meal and travel expenses, etc. for its employees. Cost remains an important parameter in in-house vs outsourcing decisions.

Source

Cons of Remote Team:

On-on-one Communication and Remote Team Management Becomes Tangled

The digital communication channels including phone, email, chat or video calls, cannot replace the efficiency of face-to-face communication. As a manager, it is hard for business owners to analyze the capabilities and managing remote workers. They need to push greater efforts in skill development and creating the right coordination among the member in the remote team.

Scaling Isn’t as Easy as It Seems

Though remote team model, grants access to a large talent pool, finding the right workers to be added to your remote team remains a crucial challenge. The associated concerns include data security, time-zone management and reliability.

A Cross-culture Gap Is Evident

Remote workers from different geographies, different time-zones and with no direct connection with the in-house team display a cross-culture gap. This can make remote team management a tough peak. However, start-up culture is more about shared values and goals.

Risks Associated to Project Failure

Remote workers are generally self-employed experts who aren’t answerable to a parent agency and work on a contract basis with clients as full-time or part-time resources. Though these experts have a significant level of expertise and a reliable work portfolio, the risks associated to delay in timelines and project failure are higher.

Dedicated Team Model

What is the Dedicated Team Model?

As the name resembles, the ‘dedicated team model’ is about building a team of dedicated resources with the help of a specialised resource agency. This model of outsourcing is leveraged by large & long-term business projects. A perfectly-structured dedicated team is a good harmony of great skills, accountability, authoritative management and affordable costs. The model is constructive for clients having defined project-scope and business goals.

There is a list of pros and cons related to the dedicated team model, which are discussed below in the article.

Best Fits For?

Dedicated team model is the right choice for constant workload projects where the dedicated team is liable to serve a client in the same sense as his in-house team. It can help startups to cut down on the upfront costs of building a skilled team and help large businesses with their team expansion goals.

Pro’s of Dedicated Team Model

Team Dedicated to Your Goals & Processes

Unlike a shared resource team, a dedicated team functions as a team of experts working full-time on your projects. You as a business owner can manage your team independently and align them according to your project and business goals. Some resource agencies grant businesses access to train their dedicated team at their premises and align them according to their processes and time-zones.

Manage Team Structure and Scale On-demand

Large enterprises often prefer to choose the dedicated team model to meet their staff augmentation goals. Hiring a dedicated team from a specialized resource agency avails a business the capability to manage their team structure. The business owners can make quick calls about new additions to the team. Unlike managing remote workers, a dedicated team is more synchronized and the outsourcing vendor is liable to help you manage the team seamlessly.

Build Team for Long-term Goals

A dedicated team serves the best for long-term projects and the same team working on a prolonged project avoids the hassle related to resource transition. Skills and standards developed across your dedicated team are transferrable and helps you in the long term.

No CAPEX and Overhead Costs

Equivalent to the remote team model, the dedicated model helps save business owners from the CAPEX cost, including infrastructure setup, furniture cost, electricity and business level-internet. 44% of US businesses choose offshore development to reduce costs. Clients also save on overhead costs like healthcare insurance, free-time benefits, and meal expenses.

Increase in Productivity

The Harvard Business Review claims that businesses experience a 10% increase in the average productivity from the dedicated development team model, without surpassing the budget. Moreover, businesses have access to a larger resource pool across the globe.

Also Read: Myths Associated with Hiring a Dedicated Web Development Team

Cons of Dedicated Team Model

Cross-culture Gap

Though a dedicated team works in close coordination with the hiring manager at the client-side, it gets a narrow perspective about the company’s values and goals. This creates a cross-culture gap, which is likely to fade over time.

Not Fit for Short-term Projects

Dedicated team model doesn’t fit right for short-term projects. Hiring a dedicated team for a short-term project (less than 2 months) may result in investing more time and finances as compared to the fixed time mode of outsourcing.

A Comparison Graph between Dedicated Team, Remote Team and In-house Team Model

Summing Up

The Upwork projection states that by 2028, 73% of all teams worldwide will utilise the remote team model. Another parameter that puts the dedicated team model above the other models of outsourcing is that it combines the benefits of an in-house team model with the remote team model. However, there couldn’t be a better bet than the in-house team model, if your resources have the right skill-set and deliver the desired returns on investment. A business needs to scrutinize its goals and capabilities well before making a choice!

30 One-line Reasons To Hire Dedicated Development Teams

Wrapping up

5 Successful Remote Team Case Studies

1. JXT- How a Dedicated Team Developed 500+ Websites Within Just 5 Years

2. Racenet’s Organic Journey to Top 3 Rankings on Google

3. Weight Watchers – How Uplers Helps Build 60+ Email Templates for WW every Month

4. How a Dedicated Team Model Helped Elite Mobile in Expanding their Business

5. Repeat Booking- Turning a Business Idea into Reality in Just 80 Days

Get The Uplers Advantage!

Top 10 Questions Answered on the Dedicated Team Model (DTM)

1. What Is The Dedicated Team Model?

2. Who Needs A Dedicated Team?

3. Who Benefits From A Dedicated Team?

4. How Does The Dedicated Team Model Work?

5. What Are The Benefits Of Working With A Dedicated Team?

6. Why Is The Dedicated Team Model Better Than Project-based Outsourcing?

7. What Is The Difference Between In-house, Remote, And Dedicated Teams?

8. How To Manage Your Offshore Dedicated Team?

9. How To Deal With The Time Zone Difference When Hiring An Offshore Dedicated Team?

10. Why Hire Dedicated Offshore Teams From India?

How Uplers Can Help You Build Your Dedicated Team

5 Best Practices for Managing Your Offshore Team

1. Know Your Team & Their Capabilities

2. Build Partnership and Make it Two-way

3. Sprint Approvals on Your Side

Guide to Bridging Cultural Differences for Indian Remote Employee

4. Make the Right Choice of Engagement Model

5. Make Security A Priority

Conclusion

A Relevant Anecdote: Outsourcing Failure

7 Disadvantages of Outsourcing for the Project-based Model

1. It’s Never Easy to Capture the Project Details in Totality

2. Possible Gaps in the Understanding of Project Requirements

3. No Control Over the Everyday Functioning of the Project Team.

4. Change in Project Requirements will Require Cost Renegotiation

5. Project Delay or Crash from the Vendor’s Side pushes you in a Royal Soup

6. There May Always be Hidden Costs

7. The Biggest Risk, of course, is Security.

The Solution: Dedicated Team Model

Top Factors to Consider When Selecting an IT Outsourcing Company

1. Meeting Your Scalability Goals

2. The Model of Outsourcing You Wish to Go With

Location-based Types of Outsourcing

Relationship-based Types of Outsourcing

3. The Best Outsourcing Location

Eastern Europe

Asia and Middle East

Latin America

4. Intellectual Property Rights and Patents

5. Company Processes and Communication Standards

6. Costs and Expenses

7. Resources and Technology

In a Nutshell

Top 5 Disadvantages of Offshore Outsourcing and their Solutions

1. Limited Control over Shared Resources

2. Frustrations with Managing Offshore Teams

3. Limited Control over Offshore Team Structure and Functions

4. Lack of Transparency in Pricing, Resulting in Overcharging

5. Lack of Control over Day-to-Day Work

We Recommend The Dedicated Team Model

Possible Solutions to Resolve Employee Retention Challenges

How Dedicated Team Model Can Curb the Growing Rate of Employee Turnover

To Conclude

The 3 Most Popular IT Outsourcing Business Models

1. Project-Based Outsourcing

2. Outsourcing to Freelancers

3. Dedicated Team Model

In a Nutshell

Top 5 Alternatives to Freelancers

1. Build an In-house Team

2. Outsource to A White Label Agency

3. Hire A Dedicated Team

4. Hire A Shared Team

5. Build A Remote Team

Conclusion

Top Factors that Hint Your Agency Needs a Dedicated Team

1. In-house Resource Hiring Cost Exceeds Your Budget

2. You Need a Backup for “Oh Shit” Situations

3. Freelancing and Remote Team Lacks Reliability

4. Long-term Projects with Constant Workload

Guide to Hiring Top
Indian Remote Talent