Outsourcing agencies vs Remote developers – How to choose

Following the adding of management layers in the 1950s and 1960s to support expansion for the sake of economy of scale, corporations found that agility and added profits could be obtained by focusing on core strengths; the 1970s and 1980s were the beginnings of what later was named outsourcing. Kodak’s 1989 “outsourcing most of its information technology systems” was followed by others during the 1990s.

In 2013, the International Association of Outsourcing Professionals gave recognition to Electronic Data Systems Corporation’s Morton H. Meyerson, who, in 1967, proposed the business model that eventually became known as outsourcing.

Key Summary

This article from InApps Technology, authored by Phu Nguyen, compares outsourcing agencies and remote developers to help businesses decide which hiring model best suits their needs. It outlines the advantages and disadvantages of each approach, emphasizing work environment, project management, and quality considerations. Key points include:

• Context of Outsourcing:
  • History: Outsourcing began in the 1970s-1980s to focus on core strengths, with Kodak’s 1989 IT outsourcing as a landmark, followed by widespread adoption in the 1990s.
  • Recognition: In 2013, the International Association of Outsourcing Professionals credited Morton H. Meyerson of Electronic Data Systems for proposing the outsourcing model in 1967.
• Why Choose Remote Developers?:
  • Work Environment:
    1. Remote developers integrate better into company culture, fostering collaboration and alignment, unlike outsourcing agencies, which operate as separate entities.
    2. Quote: “An outsourcing company can never adapt to your business because they are their entity. They will never be ‘in the loop’.”
  • Project Management:
    1. Remote developers allow businesses to retain supervisory control, unlike outsourcing agencies where a manager juggles multiple clients, diluting focus.
  • Quality of Work:
    1. Remote developers undergo rigorous vetting (e.g., Codersera’s five screening rounds, with <1% passing), ensuring high-quality, tailored hires.
    2. Agencies may compromise quality due to less control over staff selection.
  • Long-Term Vision:
    1. Remote developers align with company goals, working toward shared objectives, unlike agency staff focused on short-term contracts.
  • Continuity:
    1. Remote developers maintain project momentum, while agencies risk inconsistency due to multiple contributors.
• Disadvantages of Outsourcing Agencies:
  • Loss of Control: Limited oversight as contractors, not employees, handle tasks, complicating on-site supervision.
  • Communication Challenges: Low employee engagement in the U.S. (per Cameron Herold) hinders effective collaboration.
  • Quality Risks: Potential for subpar work if the agency’s standards don’t meet expectations.
• What is Remote Development?:
  • Definition: Employees work from home, coworking spaces, or abroad without commuting, leveraging digital tools for collaboration.
  • Quote: “Remote work simply means any work you do that doesn’t require commuting into an office.”
  • Enabled by technology, allowing flexibility and productivity from anywhere with reliable internet.
• Benefits of Remote Developers:
  • Global Talent Pool: Access to top developers worldwide, unrestricted by geographic proximity.
    1. Quote: “Which would you rather have, the best developer in the world, or the best developer within driving distance from your office?”
  • Time Savings:
    1. Eliminates commuting (average 50 minutes/day, or 305 hours/year), saving time and costs (e.g., thousands in transportation expenses).
  • Reduced Delays:
    1. Remote developers can log off during idle periods, avoiding unproductive wait times common in office settings.
  • Productivity:
    1. Studies show remote workers are often more productive than office staff, with fewer distractions (e.g., 61% cite loud colleagues, 40% cite impromptu meetings as office productivity barriers).
    2. American Express study: Remote workers had 43% more business opportunities.
  • Employee Preference:
    1. 86% of workers prefer working alone for maximum productivity (survey of 2,000 participants).
  • Cost Savings:
    1. Reduced overhead for companies, though most don’t reimburse remote workers for internet or coworking costs (per Buffer research).
• Benefits of Outsourcing Agencies:
  • Contractor Model: No employee benefits or training costs, reducing expenses.
  • Global Talent Access: Expands talent pool beyond local hires (e.g., U.S. outsources 300,000 jobs annually).
  • Cost-Quality Balance: Offers access to skilled professionals at lower rates without sacrificing quality.
• Hiring Remote Developers with Codersera:
  • Platform Overview: Codersera connects startups with top developers, mentors, PMs, and CTOs for full product development (UI/UX, wireframes, enterprise apps).
  • Rigorous Selection: Only <1% of developers pass five screening rounds, ensuring high quality.
  • Process:
    1. Post project requirements or ideas.
    2. Select from a pool of expert coders.
    3. Receive regular updates on progress.
  • Client Feedback: High satisfaction due to developer dedication and productivity, though rates are higher due to quality assurance.
• InApps Insight:
  • Aligns with Microsoft’s Power Platform and Azure, leveraging Power Fx for low-code development and Azure Durable Functions for scalable remote workflows.
  • InApps integrates Node.js, Vue.js, GraphQL APIs (e.g., Apollo), and Azure to support remote developer solutions, targeting startups and SMEs with Millennial-driven expectations for flexible, high-quality development.

Why choose remote developers over outsourcing agencies?

Work environment

You and your outsourcing company aren’t on the same page and a lack of integration is on the blame. Geographic proximity isn’t the culprit. An outsourcing company can never adapt to your business because they are their entity. They will never be “in the loop”.

The company culture defines the success of your company. Whether it’s the fluid flow of communication between the colleagues, or the company banter that takes place in between tasks.

This interaction between peers forms the foundation for a successful working environment. And only your team can provide this.

Project management

The same principles that made your company successful can be threatened by placing your business in the hands of others. From productivity to staff supervision, you lose the ability to regulate project management.

At best, your go-between is an outsourcing manager stretched thin with other clients and forced to divide their attention among several ongoing projects. Hiring remote employees let you maintain your supervisory role and oversee all aspects of deliverables.

Quality of work

Don’t run the risk of diving headfirst into the shallow end of the talent pool. If your outsourcing company is the one hiring staff, can you trust the quality of work?

Remote teams are your employees.

They go through a rigorous vetting process, as well as your interview and hiring process. You hand-select remote team members from a pool of highly qualified candidates that meet the standards and criteria your company has put forth for all the employees.

The bigger picture

Since they aren’t contracted project to the next project, they can look into the bigger picture and work towards a shared goal with the rest of your company. Remote employees to value their position and have a strong desire to grow with your business.

Loss of continuity

Outsourcing agencies seldom work on a single project. Depending on the availability of staff, your project could potentially be facilitated by many people on a given day. With multiple editors and contributors, and an inconsistent workflow, the loss of continuity and momentum can negatively affect the outcome of a project.

Disadvantages of outsourcing

• Although you can provide direction concerning what you need to accomplish, you give up some control when you outsource. There are many reasons for this, including the fact that you are hiring a contractor, not an employee. And since the person is no working on-site, it can be difficult to maintain the level of control you desire.
• According to Cameron Herold, the founder of a COO training program, communication is essential to success in the business world. Since reports tell that engagement is very low in US-based employees, communication remains a major problem.
• Despite all the benefits of outsourcing, it is only a good thing if you’re receiving the quality you expect. Anything less than this will be a disappointment.

What is remote development?

So far you have read about outsourcing, now you should also learn something about remote work.

Remote work is the growing trend of employees who don’t walk into a traditional office each weekday morning, instead opting to work remotely part- or full-time from home, abroad, or a well-designed coworking space in the name of flexibility, technological process, and productivity.

You might have heard it called “telecommuting” or even work from home, but the term “remote work” simply means any work you do that doesn’t require commuting into an office.

The premise is this: thanks to the digital age, you can complete projects and communicate with your team – even manage a team – without being in the same room or even the same city. That means that, rather than going into an office every day, you can work remotely from anywhere as long as you’ve got a laptop and internet. Good internet is key.

Benefits of remote developers

Bigger talent pool across the globe

Simply put, becoming remote means access to a bigger talent pool, whether it’s across the world, a single continent, or one country. Even if you have the best talent within your country, not all employees will be willing to relocate for a job.

Hiring from the vicinity of your office, you’re decreasing the size of your talent pool significantly. Which would you rather have, the best developer in the world, or the best developer within driving distance from your office?

Commute time

One of the most awesome benefits of being a remote developer is that you will save a lot of commute time. It is so because remote developers work from home. Their work is all in either coworking spaces or their bedrooms. A full-time office employee spends an average of 50 minutes a day on commuting to the office. It doesn’t sound much for a day, but it totals down to more than 305 hours in a year, or two weeks.

You don’t want to waste that much time. Rather, it will be pleasant if you spend this time for leisure, or be with your family.

Above all, commuting to the office costs you a lot of money. Whether you fill your gas or you have your bus/metro passes, it adds up to thousands of dollars spent on transportation every year.

Delay time

Also, remote developers save a lot of delay time. If you are an office employee, you hate that feeling. Let us assume you are assigned a project. You have completed a quarter of your project, suddenly your project manager hands it over to the next team member. Then you have to wait for the developer to complete his/her portion and hand over to you. You handed over the project at 11 am, now you have to wait for 3 hours, till 2 pm.

During this unwanted delay, you scroll your Facebook newsfeed, absolutely achieving nothing. This will take a huge toll on your productivity if this happens frequently.

But that’s not the case with remote developers. They can simply log out if they are not needed, and come back when it’s their turn.

Productivity

There are two main reasons why managers and CEOs are against remote work. First, they don’t like the lack of control. Second, they think productivity will suffer. In their minds, employees will spend their day playing video games, knitting, breaking the Guinness world record in the highest number of beers consumed in one minute. According to them, remote workers do anything but work.

This fear is unfounded, as studies have shown that remote workers are not only as productive as their office counterparts, but in many cases even more productive. Although there can be quite a few distractors when working remotely, for the most part, all of the elements that slow down your work in the office are gone.

Some employees love working alone

In a survey of 2000 participants, the researchers found the most common office obstacles to productivity. For example, the respondents listed loud colleagues (61%) and impromptu meetings (40%) as one of the biggest issues when working within the office. Moreover, 86% of them prefer working alone to reach their maximum productivity.

Cutting costs

It’s no secret that many companies go the remote route primarily because of how much money they can save on overhead and other costs annually. First of all, remote workers are more productive in general, which accounts for a large part of the savings.

In one study, it was found that American Express employees who worked from home had 43% more business opportunities than their colleagues working in an office. Happier employees simply perform better.

On the other hand, that does not mean that remote companies should pass down all the costs to their employees. As Buffer’s research has shown, the vast majority of remote companies do not reimburse their employees for costs such as internet bills and rent for coworking spaces.

Some benefits of outsourcing

Let us have a look at the benefits of outsourcing.

• When you outsource, you can pay your help as a contractor. This allows you to avoid bringing an employee into the company, which saves you money on everything from benefits to training.
• When hiring an employee, you may only have access to a small, local talent pool. This often means you have to compromise. Many companies have found that outsourcing gives them access to talent in other parts of the world. If you need specialized help, it often makes sense to expand your search.
• Do you know that the United States outsources 300,000 jobs every year? Every company has its reason for doing this, with many chasing lower labor costs. You don’t want to trade quality for the price, but outsourcing often allows you to get the best of both worlds. By searching a global talent pool, it’s easier to find the right talent at the right price.

Hire a remote developer

Do you need to complete a project within a prescribed budget and time?

Codersera is a global community of top developers, coders, mentors, PMs and CTOs. Generally, we undertake the development of a fully-fledged product. Starting from UI/UX designs to building wireframes, and scaling it up to enterprise-level apps. This is the best platform for startups that are not capable of hiring a full-time developer but want quality work.

Even more, a developer’s selection process for the platform is quite rigorous. Developers have five screening rounds. Only less than 1% make it to the end (imagine the difficulty). Afterward, Codersera inspects the developers for their expertise.

Consequently, any clients who have successfully got their projects done admire Codersera. Also, the clients are happy with their workers’ dedication and productivity. Applying online is quite easy to do. However, the developer rates are high due to the assured quality of work. If you are looking for a developer, click here.

Finally, keep these things in mind when you hire a coder.

Codersera follows three steps. The first step is to post your requirement or even an idea. The second step is to select the top coders from a pool of expert coders. Finally, the third step is to wait and be updated with the work. Have any query regarding any subject, click here.

Do you want to view the profiles of some of the top coders? Visit this page to know more.