The IT employee outsourcing industry is continuously expanding and this trend will probably become even stronger in the coming years. How dynamic this growth will be depends mainly on how efficiently service providers manage to address the needs of their potential customers. The possible benefits, however, are significant: access to unique competences or cost flexibility are just some of them. Does the current market see these opportunities and, more importantly, does it want to take advantage of them?
The future of IT projects outsourcing
According to a GSA report, 70% of the surveyed companies intend to outsource more projects in the coming years. In 2018, according to Statista, the outsourcing industry generated $85.6 billion in revenues worldwide. The total value of the contracts in the market amounted to $64.3 billion. In the face of constant challenges and dynamically changing business conditions, flexibility and ability to react quickly determine the company’s success. Of course, simple services, such as hiring-out employees or commissioning a specific project, are still available on the Polish market. Yet managed services, consulting or digital transformation are dynamically developing. IT outsourcing shows an upward trend. By 2022, this market is projected to see an annual growth rate of 6%.
How do companies chose an IT provider?
When creating an external team to be entrusted with the implementation of a specific IT project, it is crucial to define the rules of cooperation with the team leasing service provider. A properly constructed contract for the purchase of an Agile team should include an hourly and a sprint rate, as well as the entire team’s monthly costs of work, a clearly defined scope of tasks and KPI’s to account for the assigned tasks.
Many successful global companies have followed this path. Skype, GitHub, and Slack are just a few of them. All a company has to do is define its goals and KPIs, find the best possible supplier, present the idea, read the proposal, focus on its core business and let the experts do the rest.
Outsourcing services for entire project teams are steadily gaining importance, often replacing body leasing services, which have been common in some industries.
What is body leasing?
Body leasing is a form of outsourcing that allows the employment of a selected specialist, practically overnight, both for longer (several months) and shorter periods of cooperation that can be counted in days. Such form appeals to many companies due to its economic and organizational advantages as they get the sought-after specialist without the need to hire him permanently.
The power of Agile teams
Scrum is the most popular Agile methodology. Agile method of working itself is becoming the topic of discussion when it comes to responding to the changing market demand, where each client expects personalized, individually tailored solutions. Despite the fact that initially Agile management addressed several challenges in the software industry, the number of organizations that decide to transfer Agile philosophy and techniques to other branches of business is growing.
Agile teams are elite units in the IT world with exemplary efficiency – usually composed of 5-10 specialists with overlapping and complementary skills.
Advantages of the team leasing model
Business development and resource release
Management board’s main task is to focus on strategic areas of the company’s activity. It helps to increase the company’s quality of services and products, which directly translates into the organization’s development, increased competitiveness and profits. The HR department can be relieved of the endless and frustrating search for programmers and focus on acquiring key experts or talents in the area that is most important for the company’s operations.
A mature Agile team is more than a randomly selected group of people with complementary skills. The real value lies in teamwork, the ability to work in synergy, combined experience and something that practitioners call a collective mind. Companies specializing in IT outsourcing, thanks to cooperation with many clients, have the opportunity to face a wide variety of challenges every day, thus they gain experience and formulate their unique know-how to be shared with other clients.
Freedom from organizational constraints
A multi-functional and cross-functional Agile team on a project guarantees constant access to key competences. It also means reduced employee turnover, in-depth knowledge of guidelines and documentation and focus on product development.
Risk and cost reduction
The team outsourcing model, similar to body leasing, allows to reduce the business risk of a company that decides to hire a team of specialists. Induction, providing work tools, training, conferences, benefits, human resources, supplying office space, paid holidays, sick leave, severance pay on top of it and then a few months of downtime are just some of the costs that virtually every employer faces regularly with full-time employees. In this model, they are not a concern of a company that needs to scale its IT team.
Agile team leasing – a long-term recipe for success in IT
Team leasing and its potential are, unfortunately, still underestimated on the market. It is certain that organizations first to notice and use it for their own development will gain a unique opportunity to build a competitive advantage regardless of the industry. We often come across companies that, instead of focusing on their core activities, try to build their IT competences ineffectively. Current employee market proves this is not the case. It is therefore worth considering a partner with many years of experience, adequate resources, one that is flexible and has a good financial situation. This promises a long-term cooperation and a definite return on investment.