Startup Fundraising Process

The Complete Guide on Startup Fundraising Process

Raising a healthy funding round is a huge milestone for entrepreneurs, which is why a robust startup fundraising process is critical. Without money, even the smartest startup founders have trouble making prototypes of their products, testing their assumptions about the market, and getting enough investors interested in their business to get future funding.

It is no easy task to persuade a knowledgeable investor that your team has the guts and perseverance to produce a next-generation product or service. Therefore, the most well-funded businesses are aware that fundraising requires thorough research and strategy. A business must show its value proposition, traction, and how it will deliver a favorable return on investment to attract investors. So, do your research before you get into the game. Here’s a timeline of the startup fundraising process to help you keep track.

Obtaining Funds for a Startup
Investors Happily Invest Their Money in Productive Concepts 

Startup fundraising process: step-by-step instructions 

The following are the steps in a typical startup fundraising process:

1. Assumptions Validation and Prototyping 

Assumption validation is the assertion of the facts that we assume about the business environment through a well defined process. You may do this by putting your theories to the test using actual data and the comments of the people you are trying to sell to. This is critical information since no one wants to put their money into a firm or product that no one wants.

After validating assumptions, we have to do the steps of requirement analysis and system design with prototyping, where the system is evaluated iteratively. You develop a minimum viable product (MVP) to evaluate your hypotheses and get feedback from actual consumers. Then, you utilize their use statistics and many key performance indicators (KPIs), such as churn rate, client lifetime value, and acquisition costs, to determine whether your product has viability. 

Minimim Viable Product (MVP)
Minimim Viable Product (MVP) Defined

However, this process applies only when the project is being undertaken and not beforehand. Therefore, evaluating whether the suggested solution meets user requirements has to be done using different techniques such as storyboarding, videos, etc. Then, once we validate that the proposed system satisfies user requirements, we can continue on to funding, depending on at what phase the funding is required to be done.

2. Pitch Deck Development

Your startup’s pitch deck serves as the company’s initial point of contact with prospective investors. You will utilize the pitch deck to showcase your company to prospective investors during the startup fundraising process. The slides used in this pitch deck provide an overview of your company, staff, target market, product, and go-to-market plan.

It also contains slides about your business model, income generation strategy, and financial predictions. The purpose of this pitch deck is to pique the enthusiasm of possible investors so that you may continue discussing the possibilities with them.

That’s why you should emphasize producing a successful pitch deck. To succeed, your business must make a compelling, well-articulated, and well-researched case for its potential. Rather than a pitch for a product, it would help if you approached this as an investment opportunity for the investor. It describes the problems, how you intend to address them, and why you will succeed where others have failed. All of this is supported by evidence showing how an investor might benefit from investing in this problem.

3. Investor Selection & Research

Not all angel investors and venture capitalists are interested in the same business. This stage entails research to identify the most suitable investors for your startup. You can also use services like AngelList, Crunchbase, and Gust to find potential investors. These are excellent tools for identifying and investigating investors.

Additionally, you may use LinkedIn to find and contact potential investors. You may think of “potential investors” as anybody willing and able to invest in your starting business. The ideal investor for your business would be:

  • With problem domain expertise,
  • Those who had invested in businesses of comparable size to yours?
  • Ideally, in the same geographic region as you,
  • Lastly, who is enthusiastic about the problems you’re trying to resolve?

4. Introducing Yourself to the investor

A typical investor gets about 500 pitches a year, while a well-known investor like Sequoia Capital gets about 10,000.

A cold pitch rarely works in this situation because your email will likely get lost in the flood of emails. Being able to connect with someone personally is a huge asset in this situation as well. It would be best to find someone the potential investor knows and trusts to introduce you to them. 

Be cautious about doing thorough research before requesting an intro. If it is a friend, you may immediately ask them. But if it is a colleague or someone more significant or senior, you must be ready with pertinent facts about your organization and a brief elevator pitch.

5. Initiating a Conversation

After establishing a connection with the investor through a mutual connection, you must create a warm introduction to gain access to their email inbox. Herein lies the importance of your email deck. An email deck is a cut-down version of your pitch deck, with no more than ten slides and just the most important aspects. It typically contains less text than the pitch deck itself.

Your objective is to present your startup to the investor so they can evaluate it and decide whether or not to invest in your opportunity. Typically, the email deck is concise, well-structured, and straightforward, with a call to action requesting that the investor review and discuss your pitch deck in person.

Additionally, you may incorporate a video pitch with your email deck to boost its impact.

6. Investor’s Meeting and Presentation

This is a significant step in the startup fundraising process since it is the day you meet with the investor and present your business. Before the meeting, you conduct thorough research on:

  • The investors you’re meeting
  • Their portfolio companies
  • The domain they’re interested in
  • Any other pertinent information?

Typically, the meeting is brief, with 20–30 minutes allotted for the presentation and another 15–20 minutes for questions. It begins with a personal introduction, an explanation of your business plan and its potential, and then an investment proposition.

This meeting aims to attract the investor’s attention and secure their commitment to invest in your startup. Typically, negotiations on the investment type, amount, valuation, and equity follow the presentation.

7. Investment Agreements and Due Diligence

The talks don’t stop with the initial meeting, unless it’s a demo day hosted by an accelerator or incubator, when businesses get to present in front of many investors. Typically, many further meetings are necessary to agree on the investment amount and other crucial aspects. To reach a mutually beneficial agreement, both sides must participate in giving and taking.

During the due diligence process, the investment team examines all areas of your startup, including financials, revenue model, competitors, team strength, and even the founders’ previous job history.

Upon the successful conclusion of this step, the final negotiations commence. At the pre-term sheet stage, you are expected to understand the investment kind (equity, debt, convertible note, or SAFE), quantity, value, and equitable distribution among the company’s founders. In this case, a competent investment attorney can help you understand the legal ramifications of the investment term sheet and safeguard your interests.

8. The Term Sheet

A “term sheet” is a contract that outlines the conditions and investment structure. In general, it consists of the following three sorts of terms:

Economic terms

This includes details such as vesting, excise period, anti-dilution, valuation, price per share, and the amount of investment.

Control terms

These stipulate the shareholder’s rights and responsibilities, protective provisions, board seats, and the drag-along agreement.

Other terms

They include, among other things, dividends, rights to redemption, rights to assets, and other rights.

A term sheet is an agreement that is not legally binding, and a more comprehensive due diligence process often follows it. And this ultimately results in the formation of a legally binding agreement, known as the shareholders’ agreement.

Term Sheet Facts
Term Sheet Critical Facts to Consider

9. Post-Term Sheet Diligence

The Post-Term Sheet Due Diligence is one of the most critical steps of the startup fundraising process. Why? Because the term sheet is just the beginning of your due diligence. Now, the investment team is conducting a more thorough review of your business. This phase is more crucial since it covers several laws, including assessments of employment contracts, intellectual property, business organizational papers, and other commitments.

Additionally, the investor’s attorney becomes engaged at this stage to guarantee that the legal requirements outlined in the term sheet are followed. During this phase, the investor team focuses on the following:

  • Financial statements and bank statements
  • They scrutinize the financial health and market valuation of the startup.
  • Background checks
  • The investment team evaluates each founder’s history and reputation in the market.
  • IP diligence
  • Security of the company’s intellectual property.
  • Legal due diligence

Depending on the complexity of your business and the amount of information you’re ready to offer, due diligence might span anywhere from a few days to several months.

10. Round Completion And Fund Transfer

After the completion of due diligence, it is time to conclude the agreement and have the funds sent to your account. Signing the legal paperwork that formalizes the investment and transferring the funds is the last stage. This step concludes the journey. Typically, this includes:

The shareholder agreement

It is a legally binding agreement between the business and its shareholders that describes the investment’s terms and conditions.

The debt agreement

This legal document stipulates the sum that must be repaid-with interest at a certain time.

After signing these contracts, you are free to begin your startup’s journey toward success.

Shareholders' Agreement Template
Shareholders’ Agreement Template

Treinetic’s Final Thoughts on Startup Fundraising Process

The startup funding process has a number of stages, as has been mentioned. You have to follow all the steps to:

  • Kickstart your startup fundraising process.
  • Maximize your startup investment potential.
  • Scale your business to all-new heights.

Several entrepreneurs also enroll in programs that aid with financial due diligence, investor engagement, and other tasks to expedite the startup fundraising process. Some ecosystems provide a thorough, tested program for startup funding—Spark Services. The single biggest competitive advantage a company may have is shortening the fundraising timeframe by securing funding from strategically suited investors.

The real work starts after you’ve raised enough money to get your business off the ground. Our warmest wishes are with you.

Srartup Project Management Guide

A Beginner’s Guide to Startup Project Management

Startup project management is critical. Why? Every day is different in the startup sector. Despite this, many business owners fail to see the need for effective project management for their budding businesses. But it is true that when project management is done well, there is no chance of making a mistake. With so much to accomplish and so many hands in the pot, there is a lot of pressure on everyone involved. Startups have a team-first ethos, which means that everyone on the team is eager to pitch in and help get the work done. Even though the horizontal leadership structure may help build a sense of community, the day-to-day tasks and responsibilities of owning and finishing a project can get confusing and messy.

When nine out of ten businesses fail, and every minute and dollar spent in the beginning is important, wasting time may be expensive. To reduce the chance of failure and achieve that elusive startup success, it is necessary to have the appropriate tools in place. And these may include project management software that keeps the whole team focused and on target.

Startup Failure Stats
Nine Out of Ten Startups Fail, Which Is a Significant Percentage 

Startup project management: why is it critical?

Startup project management can be difficult, but no business owner can overlook it. In fact, every business, no matter how big or small, needs to be able to manage projects well. However, startup project management and efficiency may not be at the top of your priority list when you’re just starting. However, as your business expands, these considerations should rise to the top of your priority list. These aspects of a business are critical to the accomplishment of a project and the execution of a business strategy successfully.

A structured approach to startup project management may appear pointless, restrictive, and unnecessarily demanding in today’s fast-paced, entrepreneurial startup environment. However, establishing project management practices and using a software product at the outset can help your company survive as it grows. Method and structure for the project can coexist with flexibility for changes in them, and a software application for project management may help with both.

Startup Project Management Tips for Entrepreneurs

1. Set attainable startup project management goals

Entrepreneurs must not “just” have objectives; they must also be worthwhile objectives. Setting and attaining realistic objectives will provide you with contentment and well-being. Start by making a solid base for establishing goals.

  • Recognize your clients.
  • Make a solid plan for the project.
  • Possess a can-do attitude and an adventurous spirit.
Startup Project Management - Setting Realistic Goals
Set Realistic, Achievable Goals for Your Startup  

Think about the following:

  • What is my long-term goal’s most basic purpose?
  • Evaluating the feasibility of the long-term goal.
  • How to build on what you’ve done?

Regardless of where you want the startup to be, you should set goals that you can achieve and, more importantly, that the startup is required to achieve. 

2. Turn failures into success

A business owner’s life is what they create from the beginning. The ups and downs of being an entrepreneur are something that most of you probably aren’t aware of. But you’ve probably heard about the “flowery life” of being an entrepreneur.

The smooth running of the project will be made difficult by complaints from stakeholders, heated discussions within the team, missed deadlines, and challenges with the project’s financial resources. Therefore, it is up to you to choose how you will react to the obstacle and transform it into an opportunity for business development. What do you think about the failures you encounter?

3. Start with yourself (self-evaluation).

On your way to becoming an entrepreneur, you’ll need to stop and think about where you are and where you want to go. So, what motivates you to start your own company? As a source of additional income? For a greater sense of liberty? For passion? Is that what you want? Find out the answer for yourself. Prepare yourself for a follow-up question like:

  • Do you have any special skills or talents?
  • Are you a person who takes responsibility?
  • What excites you the most about life?
  • Have you got enough energy to work on the weekends?
  • How much money do you have?
  • Are you clear on what you need to do?
  • Which lifestyle do you plan to pursue in the future?
  • Are you ready to be your own boss?

4. Preparing for Milestones

A milestone may signify a shift in development. It can help you let people know what is going on with your project. One of the most important parts of your project plan is showing you how you work on your project. Establish the ideal benchmarks for your team to reach. Discuss the significance of each milestone with your team to keep everyone on track toward the desired outcomes. From the start of your startup’s project management, there are also things you can do to make sure that all of your goals and objectives are met.

  • Find and eliminate project risks.
  • Set progress reporting
  • Use calendars to keep track of important dates.
  • Keeping tabs on the progress of a project’s deliverables is essential.
  • Think about the support of your stakeholders.
  • Prepare yourself for the long haul.

It’s important to start increasing the ambition of your milestones over time so that your initiatives would always be a success. 

5. Talk to your team regularly

To successfully communicate with the relevant people, you will need to understand the communication process. When it comes to startup project management, better communication means everyone understands the importance of good project management. Every day of communication within the team helps maintain the requirements under control. As the project progresses, you’ll be able to keep your team up to date on everything.

Communication is more than simply a two-way exchange of ideas; it requires an awareness of the project’s ins and outs. You need to be available to everyone, know what problems the project will face, get everyone involved, and be able to explain your vision clearly.

Effective Communication in Startup Project Management
Effective Communication Helps the Whole Team Work Towards Business Goals 

6. Set a budget, and a deadline

Have you given any thought to the significance of the three constraints for startup project management? This is an essential aspect of the project since it monitors the administration of the startup project. Time allocations are of the essence if you want to launch your product or project on time successfully. Therefore, you must have a system that allows you to estimate the length of time required to complete each job. You can easily compare the amount of time spent on a work or project using free Gantt chart software that includes project management capabilities.

Defining a project’s scope is important for managing it. It is necessary to make a decision on the scope of the product or project. It provides an explanation of the predetermined criteria that must be met in order to finish the project on time and without exceeding the specified budget.

Cost budgeting establishes a foundation for future costs. Money is the reason many businesses fail. Therefore, you must organize your resources to avoid running out of money. Using project management software, you may acquire an understanding about an accurate estimate of your budget by assessing the variations in costs. 

7. Set Up a Team That Isn’t Going to Sink Your Company

Research on why startups fail shows that having the wrong team is one of the top reasons. Entrepreneurship is not a lonely endeavor. You can not do it alone. CBInsights says that 23% of businesses fail because they don’t have a strong staff with the right skills.

Here’s how to find a great team for your new business:

  • Look for experience that matters.
  • Create a shared understanding of the values and norms that guide your team’s conduct.
  • Make sure they are all going the same way.
  • Explain to them the importance of providing excellent customer service.
  • Convince them of the value of what you are trying to do.

8. Startup project management tools 

There are many high-level bucket features in project management tools. Some examples of what you can do with a tool are:

  • Keeping track of what has to be done
  • Planning
  • Keeping track of documents and files
  • Managing inventory
  • Organizing resources
  • File-sharing
  • Reporting bugs
  • Budgeting and sending bills
Project Management Software
Make Use of Startup Project Management Software for Better Outcomes 

These online project management tools can help you stay organized as you embark on your company adventure. You can also compare project management tools and their detailed features to find the best fit for your organization. Here’s a list of startup project management tools to consider:

  • ProofHub
  • Droptask
  • Hitask 
  • nTask 

Wrapping up 

Remember that project management at your company doesn’t have to be unnecessarily complicated and demanding. The right tool will also help you in many ways, including: 

  • Make the most of your limited resources.
  • Keep your customers and the team happy.
  • Offer you the necessary skills and procedures to bring projects through to success.

This is how we’ve grown over the years and became an award-winning software engineering company.

How to Scale Remote Team

Everything You Need to Know About How to Scale Remote Team

Understanding how to scale a remote team is essential if you’re thinking of setting up your own IT consulting firm. In recent years, the need for company executives to manage remote teams has grown tremendously due to the attractiveness of a remote workforce. The advantages of remote working are many. And they may be reaped by both the business and the remote team members. These benefits include increased employee satisfaction due to the flexibility of working places and a more extensive global reach for the organization.

Why choose remote teams?

When discussing how to scale a remote team, it is essential to consider why they have chosen to work remotely. Consider the following scenario: you want to launch a new IT firm in a few months. It’s been proven that companies can save a lot of money on employee costs with remote teams. And this is because they don’t need to have physical office space. This means that the business usually doesn’t have to spend a lot of money at the start.

In recent years, remote working has become more popular among IT professionals and small and startup organizations. And the global pandemic has significantly contributed to this increased popularity. The settings in which these organizations operate are constantly changing. Therefore, they see the obvious advantages of not making a significant investment in a physical work location.

Remote working has many advantages. But it also poses many obstacles to businesses and the people in charge of management inside the organization. Managing a remote workforce comes with several issues. These may include ensuring that employees are working as efficiently as possible, that they are present when they are needed, and that they are motivated.

The Advantages of Building Remote teams
The Advantages of Building Remote teams

What Exactly Does It Mean to Scale a Team?

Scaling a team is simply the process of increasing revenue while keeping team costs at a constant level. If your sales rise by 40%, but you have to add five additional workers to your team, you aren’t scaling it. If you can handle that 40 percent growth with your existing personnel, you have successfully scaled your company’s operations.

How to scale a remote team: step-by-step instructions

UC Berkeley and Stanford researchers found that 70% of the companies they studied sought to scale too early before other basics of their company were in place. They published their findings in the Startup Genome Report. A key conclusion of the analysis was that premature scaling was a contributing factor in 90 percent of failing startups. Therefore, as well as knowing how to scale remote teams, you must know the right time to go for it.

What is the source of this widespread issue? It all boils down to the reality that none of these choices are made in a vacuum. For some startups, the temptation to exploit hiring statistics as a façade of success while under pressure to enhance performance may be tremendous. A startup founder could be under a lot of pressure to show investors that things are going well for the next meeting. On the other hand, a mid-sized (proprietary) software company would have to respond to many requests for a new feature and make it happen before their competitors.

The time it takes to see a return on investment (ROI) varies by position (the position in the management hierarchy of the organization) and might be months long. Among the costs of recruiting are the time spent by existing workers teaching new employees and the cost of hiring itself. It costs the company a lot of money and time to get rid of people who aren’t healthy or who leave early. Don’t focus on a short-term victory to distract from long-term uncertainty. Invest time in defining how your organization’s mission, values, and culture will be implemented on a new team.

Below are the crucial elements of how to scale remote teams:

Continue to be adaptable (stay agile)

When referring to a group, the word “agile” describes their capacity to adapt. The self-organization of all team members is the first step in scaling your remote team. The completion of any product or project relies on various people, including developers, designers, QA officers, and so on. Teams that work in an agile manner are cross-functional and have a shared sense of responsibility for the outcome.

Agile Development for Remote Teams
Agile Encourages Stakeholder and Team Engagement

Scaling your business the old-fashioned way will result in organizational silos and sluggishness. On the other hand, firms that use an agile approach find it much simpler to adapt to scalability problems. When business experts first used agile methods, they thought they could only be useful for small-scale projects. Perceptions, on the other hand, have shifted dramatically.

An agile team is defined as a team that executes an agile project (a project that follows iterative development which results in continuous and incremental improvement.) For example, by establishing the significance of features, the team may understand the most critical aspects of a project that might provide value. When a team of software developers uses an agile methodology, they may meet a project’s deadlines and costs progressively, allowing it to be launched sooner and begin earning revenue sooner.

Diverse firm personnel may come together to provide the first scope of work, i.e., the MVP (Minimum Viable Product), much more quickly than anticipated if they work cooperatively on the project.

Create a highly effective, distributed development team

When wondering “how to scale a remote team,” this is one of the most crucial things to keep in mind as you plan. Your firm will never be able to expand effectively if you recruit the wrong individuals for the job. For agile teams to work, team members must work together to accomplish tasks. The task of identifying the most qualified candidates in this industry is challenging. But one must also keep in mind that there’s intense rivalry among firms. Therefore, it has become challenging to provide above-average pay and perks to their employees.  

A distributed team provides the ability to enrich your current resources with specialists and generalists. It also gives you access to a larger global talent pool with more favorable wage expectations. And this improves your return on investment and increases your productivity.

The problem is that leading a remote team may be very difficult to manage. In your capacity as a company, you will be responsible for supplying your remote workers with the required infrastructure and technology. While some organizations choose to hire in-house staff or freelancers, the majority prefer to use an alternative method known as outsourcing.

Using an outsourced development team is a good idea

It takes a lot of time, money, and dedication to hire a new employee. If you hire someone, you have to provide them with perks like health insurance and an annual bonus, among other things. The same situation applies if you employ a freelancer. You should not expect them to devote their complete attention to your project alone. And this is because they may be working on many other projects at the same time as your project. Outsourcing is an excellent middle ground since it allows you to save time and money while still receiving total devotion. The option of outsourcing tasks that are excessively time-consuming and create undue pressure on your present employees is available to you as well. 

How to Scale Remote Teams - Outsourcing
Outsourcing is an excellent method of assembling a remote workforce

Moreover, outsourcing is a great way to build a distributed team because you don’t have the skills in-house or you have too many projects. There are several advantages to outsourcing, including the fact that there are no set costs; you will only be charged for the services you get for a particular project. In addition, outsourcing lets you quickly grow and slim down your development team with varying needs. You don’t have to worry about letting people go when the project is done or hiring quickly when the project is growing.

Choose the Most Appropriate Processes and Technology

This is another prime element to consider when discussing the topic of “how to scale remote teams.” Open communication is key to managing a remote group of people. And if you employ an agile strategy, it is critical to maintain open communication and utilize the right technologies in development. And these may include video conferencing, project management, etc. It’s essential that you automate all the automatable jobs. An automated task management system will allow the teams to focus on high-impact work instead of tedious duties.

If outsourced, you should ensure that your outsourcing contractor provides all of the tools and resources necessary for the various developers to perform their duties. Ensure that your in-house staff are in sync with your outsourced staff and have access to all the resources they need to execute their jobs.

It becomes more challenging to determine which technology is the best choice and when to invest in it as time passes. Leasing technology gear and tools is an excellent alternative to buying them, as it avoids the entire cost of the item. If you choose this route, you won’t have to stress about finding the money to buy the tools you need to get started right away. You only have to pay a monthly fee for each user and per device.

It’s essential to connect your scaling strategy with your current company demands while also planning for future expansion for scaling your remote team. If your business adapts quickly, it will be easier for your development team to keep up with changes.

Analyze and make modifications as necessary

To be successful in any undertaking, you must be open to the possibility of change. For a company to be successful, it must constantly monitor changes in the market and adapt its strategy accordingly. Develop and promote best practices for your whole team, no matter how geographically scattered they may be. To become more adaptive, your company will need to take a proactive approach to monitor the changes. 

Taking a proactive approach also helps identify relationships amongst teams, as well as the identification and mitigation of possible hazards. In the case of environments that have utilized Scrum, adapting Scrum ceremonies to the demands of each team is essential. You must also pick the most appropriate strategy for the team’s size. Retrospectives provide an excellent chance to evaluate your company’s return on investment, efficacy, and productivity.

Treinetic’s final words on how to scale a remote team

Scaling a remote development team may be difficult. But the advice provided above on how to do it will help managers and team leaders build a solid foundation for future growth and expansion.

When implementing agile techniques and putting technology and procedures into place, it is critical to identify cooperation among individuals and the dependencies between them. Assemble the right team, whether inside the company or externally contracted. Only then can you ensure that best practices and solid relationships are in place to provide a mutual understanding of the desired outcome. 

Dedicated Teams Pros and Cons

Dedicated Team Pros and Cons | Comprehensive Guide

Our discussion today will mostly focus on dedicated team pros and cons. Why? Because according to a recent report from Grandview Research, the worldwide software development outsourcing market will increase at an annual rate of 7.7 percent from 2021 to 2027. And this will bring the industry’s total revenue to $937 billion in only six years from now. Without further ado, let’s get to the main topic now. 

Global Outsourcing Rates 2019
Global Outsourcing Rates 2019

What Is a Dedicated Team Model and How Does It Work?

Before getting to the dedicated team’s pros and cons, let’s understand this model. Working remotely, the dedicated team model (DTM) may speed up the time it takes a new product to market while also streamlining the company’s operations that use it. This team is not an extension of the client’s team. It’s a separate entity with its own structure and management. And this makes it less reliant on the customer than other software development models.

In addition to the dedicated team model, there are many different types of outsourcing methods. For example, you can compare the dedicated team with the fixed-price model. But dedicated teams of pros and cons can make it a better choice than other models in many cases.

Reasons for Contracting Out Your Software Development Project to a Third-Party

The use of remote work for in-house software developers is encouraged, and companies are pushed to comply. Outsourcing professionals have already mastered a new work model, and it is now up to in-house employees to adopt it. We can no longer afford to ignore the importance of working remotely.

Software outsourcing provides the following benefits, which make it the ideal choice in today’s fast-paced IT world:

  • It allows you to concentrate on the most important areas of your business.
  • Aids in operating cost reduction and control
  • Flexibility in terms of staffing
  • Having access to the top capabilities

Dedicated team pros and cons

Now that you know what the dedicated team model is, let’s get to the dedicated team pros and cons. Let’s start with the pros.

The Pros of Dedicated Teams

A dedicated project team structure has several benefits over other models. We’ll go through the most important ones here.

1. Efficient Collaboration

The client and the dedicated team members collaborate closely to achieve a specified goal and provide tangible outcomes for all parties involved. They connect with one another regularly and engage in brainstorming sessions. And this is to identify the process’s strengths and weaknesses and optimize workflows and long-term planning.

This strategy is necessary for the prompt resolution of unanticipated challenges as well as the successful completion of project-related obstacles.

2. Faster development

How fast would you want to get the job completed? Another benefit of dedicated models is their increased speed. They may significantly accelerate the process by bringing their knowledge and skills to the table and rapidly adjusting to new needs.

3. Project Requirements Flexibility

When you do not yet have a clear development plan and need to update your project regularly, the dedicated model is ideal. Compared to the fixed-price model, which employs waterfall as a regular operating approach, one of the primary advantages of dedicated teams is their flexibility. Any changes to the project scope are welcome by your dedicated team.

4. Efficiency in terms of costs

Cost-effectiveness is one of the most important facts to highlight when reviewing dedicated teams’ pros and cons. In most cases, hiring a dedicated team for a project is less expensive than hiring in-house professionals. And this is especially true if the team is based in a region where development expenses are much lower than in your country or region. 

A team of professionals with a track record of successfully completing comparable projects to yours would not break the bank. This is highly applicable to outsourced, dedicated development teams in Sri Lanka. They will do the essential work without sacrificing the quality of the final product. It’s a fantastic opportunity to lower your human resources expenses and the overheads associated with hiring new staff.

5. A Focused Approach

Having a focused approach is one of the most significant benefits of working on a project with a committed team. All individuals working on the project will devote their whole attention to it, dismissing any possible distractions. Not only that, but there’s more. Flexible in that it may be reconfigured at any moment to meet the current requirements and demands of the project, ensuring that the project is completed more quickly and with superior outcomes than it would otherwise.

6. Transparent Management

Customer access to time tracking and task management systems is available upon request by dedicated teams. This enables them to stay on the same page while also keeping track of their progress.

In addition, regular contact through messaging apps such as Slack and Telegram and the daily reports that you will get will help ensure transparent administration.

7. Experience and expertise in the relevant field

By outsourcing to dedicated software development teams, you ensure that your project is managed by experts who possess the essential skills and competence. Most of the time, these individuals have previously accomplished projects with goals identical to yours. They can provide you with valuable guidance and consider even the smallest aspects that you may have overlooked.

After a period of time spent working together, they have refined their processes and acquired the necessary expertise to delegate duties. You’ll save time, avoid potential problems, and reap the many benefits of not starting from scratch.

Dedicated Team Model Pros
Pros of Dedicated Teams

Cons of a dedicated team

Since this article is about dedicated team pros and cons, let’s figure out the cons so that you can take action to avoid them. It’s not appropriate for every scenario, and there are a few problems, just like with every other engagement model. The following section discusses the most significant drawbacks of the dedicated team concept.

1. For a short-term project, the efficiency is low

It is more cost-effective to engage a dedicated development team when working on large projects that are continually evolving, whose specifications are variable, and whose requirements change regularly. It is preferable to go with a different model in all other circumstances.

2. It’s not a one-size-fits-all solution

Ensure that the model you choose is precisely what you’re looking for before getting into any agreements. Suppose your project may be long-term in nature, but you have clearly defined objectives and a set of criteria that seems to be definitive. In this case, signing a contract with a dedicated team may be a risky move for your organization.

3. Different Time Zones

Different time zones may become a severe issue when an overseas corporation is involved. However, if the team adheres to agile development principles, this issue may be readily resolved.

After weighing dedicated team pros and cons, you will greatly benefit from knowing how a dedicated team helps grow your business.

Dedicated Team Model Cons
Cons of Dedicated Teams

Some Advice on Choosing an Outsourcing Software Development Team

Let’s get to the next stage, as you have a better understanding of dedicated team pros and cons now. So you’ve decided to hire a group of people to collaborate with you. However, how does one go about selecting a winning team? The simple steps described below will guide you through the process of securing the best of the breed.

1. Request References

Contact current and former customers to inquire about their satisfaction with selecting experts, communication, quality assurance, and product development. This kind of feedback is always the most reliable indicator of overall quality.

2. Discuss the approach to work that you will take

When working with a dedicated team on complicated and long-term software projects, we believe that the agile development approach is the most effective way to solve the problem. It enables to build the project in stages, beginning with identifying the highest priority needs. Additionally, Agile delivers high transparency on the project’s progress.

3. Take a look at the Portfolio

This is where you may look at earlier work and decide whether or not you want to pursue it further.

4. Find out about the rates and talk about how the billing process will work

Various companies charge different fees, which may either be in line with your budget or leave a dent in your pocketbook. This will assist you in planning your budget and making modifications as necessary. Keep in mind that saving money should never come at the expense of quality or overall trustworthiness!

5. Identify the provided documents

We record every step to minimize the possibility of misunderstandings. And we aim to increase team communication in every way that we can. To do this, we determined the most appropriate tools for the job:

  • Team and project management.
  • Tracking of bugs and issues
  • System of code review
  • The administration of source code and repositories
  • Release management.
Dedicated Team Model - How to Choose
Choosing Your Dedicated Teams

Dedicated Teams at Treinetic

Treinetic’s professionals have a wealth of knowledge and expertise in establishing and managing successful dedicated teams for organizations of all sizes, from multinational enterprises to start-up companies. A team’s performance is heavily influenced by how successfully the service provider manages the team’s personnel resources, infrastructure, and working environment. Here’s why Treinetic should be your first choice:

Based on the client’s requirements, we have devised a system for collecting information and putting together a dedicated team. With a project management team and a business analyst in regular contact with the customer, we ensure that the development process is transparent and problem-free.

We can quickly expand our devoted workforce in response to a client’s requirements.

Some final words

In addition to supporting clients in different time zones, Treinetic has been a remote-friendly organization for many years. Regardless of the epidemiological situation, we are completely prepared to operate online and get things started as soon as possible. All of our human resource administration is done remotely. And this allows us to maintain a strong connection with our customers while also delivering products on time.

Native VS Cross-Platform

Native VS Cross-Platform: What to Choose in 2022?

In this blog post, we’ll go through the two primary techniques for app development: native VS cross-platform development. Why? Because, as a result of technological advancements, our lives have grown more reliant on digital assets. We make the most important choices in our lives and organizations via the use of the Internet and mobile applications. Businesses have a hard time competing in the digital world because there are so many apps on the Play Store and App Store and they have limited exposure, skills, resources, and funds.

It is predicted that the yearly number of app downloads globally will reach 299 billion by 2023, an increase from the expected 247 billion global app downloads in 2020. In addition, by 2023, paid downloads and in-app advertising are expected to produce over $935 billion in income for mobile applications.

Mobile App Downloads in Billions
There’s a Rapid Increase in the Number of Mobile App Downloads

Because of the competitive environment, business owners are under constant pressure to place more emphasis on the quality, precision, functionality, and other factors that encourage prospective consumers to choose their services over alternatives. And it is at this time that we must decide between native VS cross-platform development methods. Businesses often face many difficulties, including deciding on the best technology to depend on, whether to use iOS or Android, and which app development framework would be the most effective in increasing client interaction.

What to Consider When Choosing a Methodology for Developing a Mobile Application

When deciding between native VS cross-platform development, we must first understand the factors to consider when selecting a mobile application development approach:

The complexity of the application

Cross-platform development is an excellent option if all your app does is utilize network-fetched data. In contrast, if your application needs extensive processing or access to low-level APIs, you might choose native development because cross-platform tools may not be able to access them. 

Cost

Native development delivers high-performance applications, yet it is time-consuming and expensive to develop. If you are working with a small budget, cross-platform development is the best option to consider. Because just a single codebase is created for an app that runs on both Android and iOS, you’ll save between 30 and 40% on development costs.

Time Required for Development

Getting an MVP app up and running as soon as possible is important in some projects. This is the point at which you should think about cross-platform development. You do not need to work on two different versions of the app. Creating an app for both Android and iOS requires just a single development cycle.

UI/UX

Native development is the way to go if you want stunning visuals and an engaging experience. When developing in a native environment, developers have access to the UI/UX components. Selecting cross-platform development may strictly limit the UI/UX elements of the program.

Native vs. Cross-Platform: What Is Native App Development?

Building a mobile app just for a single platform is referred to as “native app development.” In this case, programming languages and tools unique to a particular platform are used to create the app. For example, you can develop a native Android application using Java or Kotlin while developing iOS applications using Swift and Objective-C.

When comparing native VS cross-platform applications, native apps are renowned for providing a superior user experience because they are typically high-performing. Because the visuals are matched to the platform’s user experience, the overall user experience is seamless. On the other hand, startups are worried about the high cost of native app development. And that’s because they must simultaneously build for two platforms.

The Pros of Native Application Development

Increased Scalability

Native apps are scalable because of the resource management flexibility and the range of tools available.

High-performance and excellent user experience

The direct communication between the code and the underlying resources results in an excellent performance. Additionally, native applications often offer a superior user experience (UX) that is synonymous with the platform.

Broad Functionality

If you’re working on a platform, you’ll have access to every API and tool that it has to offer. According to the current state of technology, there are no restrictions on how programmers develop the new app. 

Improved Support in Store

Generally speaking, native apps are simpler to publish, and they are often placed higher in the platform’s app store since they provide superior performance and speed.

The Cons of Native App Development

Costly

When you need to publish your app on both iOS and Android, developing native applications might be outrageously costly. Because of this, you’ll need to deploy two teams that will work on separate platforms.

Time-consuming

Because the work done on one platform cannot be repeated on another, native app development is time-consuming. Rather, a different team will be required to work on the other version.

Native App Development Pros and Cons
Native App Development Pros and Cons

What Is Cross-Platform App Development and How Does It Work?

Because we have already reviewed native app development in today’s subject of native VS cross-platform, let’s take a closer look at cross-platform development now.

Cross-platform development refers to developing an application that is compatible with several platforms. This is accomplished via the use of technologies such as React Native, Xamarin, and Flutter, which allow the applications built to be published on both Android and iOS devices.

While cross-platform development saves time and money, there is a danger that quality may be compromised in the process. The implementation of an app that operates ideally on several platforms is complex, as the app will need an extra abstraction layer when running. This can result in decreased performance.

Cross-platform programming is more attractive to startups since it saves time and money. Nonetheless, it would help if you were mindful of the fact that it may be more difficult to correct the app beyond what is permitted by the framework.

The Pros of Cross-Platform Application Development

‍Less Costly

An application that runs on several platforms will need just one development team rather than two, as in the case of a native app. As a result, you will save money on the development costs.

Faster Development ‍

When developing an application that operates on various platforms, just a single development cycle is necessary.

Single Code Base 

There is just one code base for the app since it was developed using a single cross-platform development tool.

The Cons of Cross-Platform Application Development

An app that runs more slowly

Because of the need for an extra abstraction layer and rendering process, the cross-platform application is much slower than its native equivalent.

Limited Functionality

Developers may probably have problems accessing smartphone features such as the microphone, camera, and geolocation in the same manner that a native app would.

Limited UX 

Cross-platform applications are unable to make use of native user interface components. As a result, it cannot provide the same user interface experience that is familiar with the platform.

Cross-Platform App Development Pros and Cons
Cross-Platform App Development Pros and Cons

Native VS Cross-Platform: Which One to Choose?

Choose wisely, since your choice will influence how much it will cost, how long it will take to develop, and how consumers react to the application. Before making a decision, consider all of the factors listed above. If you’re still not sure which to choose between native and cross-platform, here are some additional tips:

When Should You Think About Developing a Native App?

  • It is more likely that your target audience will be using your app for the first time, and you want to make a good first impression by providing them with the best possible app experience.
  • It is necessary to code specifically for a single platform.
  • You are one of the businesses interested in 3D games and animations.
  • You want to gain many daily active users (DAUs), pursue venture capital investors for product financing, and design an app that is simple to understand yet intuitive to use.
  • It is necessary to include device-specific features like GPS, a camera, etc.

When Should You Consider Developing a Cross-Platform Application?

  • You have a tight budget, limited time, and limited resources, and you must develop a mobile application on many platforms.
  • It would help target both iOS and Android app users in your marketing efforts.
  • You need a more rapid app development process.
  • The app isn’t complicated, and it doesn’t need any features that differ significantly across platforms.

So, you can choose between native and cross-platform based on the scenarios explained above.

Our final thoughts

As an award-winning software engineering company, we know that there are advantages and disadvantages to both native and cross-platform app development. To choose an app development platform between native VS cross-platform, it is necessary to determine the exact business criteria that must be met. Before selecting an app development platform, IT business managers must determine exactly what they want. This is why you need to think about both the short and long term when making your decision.

Business plan for mobile app

How to Write a Business Plan for a Mobile App?

You’re probably looking for some guidelines on how to write a business plan for an app. Congratulations! You have found the most comprehensive guide on how to write a business plan for a mobile app. Ideation, planning, and execution are all important steps to consider. These are the cornerstones of every project’s success, and they are interconnected. In the rapidly shifting world of information technology, it is hard to predict success with 100% certainty. However, if you devote enough time and effort to each of these cornerstones, your chances of reaching the top will increase significantly.

On the other hand, some business people choose to ignore creating a business plan for a mobile app. These people think that practice is a better way to get the results they want. They hope that spontaneous decisions will help them get to the top of the manufacturers’ list. Unfortunately, this sort of approach never delivers positive results. It’s important to remember that having a plan is the best way to be successful. So, let’s go further into creating a business plan for a mobile app.

What is the importance of having a business plan for a mobile app?

The market for mobile apps is expanding at a rapid pace. Getting into the game before the market gets too crowded is becoming more common.

According to Statista, worldwide mobile app revenues reached more than 365 billion U.S. dollars in 2018. According to projections, paid downloads and in-app advertising are expected to produce more than 935 billion dollars in mobile apps by 2023.

Mobile app revenue growth
Mobile App Revenue Growth in the Coming Years 

Creating a useful and successful app isn’t as simple as you may assume, despite how attractive it seems. The first step toward a successful launch should be creating a business plan for a mobile app. 

A thorough business plan for the smartphone app is a guide for everyone participating in the project. It also tells you how to get the app out into the world in the most profitable way. The process of creating a successful mobile app business plan is rather simple. When you write a business plan, you’ll get a clear picture of your app, as well as information about how to market and finance it.

What are the components of a business plan for a mobile app?

The most important issue to address in a business plan is whether or not the product is profitable to produce. When drafting a business plan for a mobile app, you’ll need to estimate the cost of development and commissioning as well as the timeline for when your project will provide a return on investment.

Creating a reliable and stable mobile application for enterprises, individuals, or non-profit organizations should be your goal in this case. Only then will your app be competitive. Your business plan for a mobile app must have the following:

 – Business plan for mobile app: Executive Summary

The executive summary is the first thing we will look at now. This is the first and most crucial section in your business plan for a mobile app since it is the first thing an investor will see and read. There should be no detailed information about how your product works in the executive summary form, so it should be simple and clear. Your executive summary should include information on the current market situation, your target client, and what unique problems your application can address.

Business plan or a mobile app - executive summary
The Must-Include Elements of the Executive Summary 

Make your proposal unique so that your company stands out from the rest. Put another way, it would be best to create a unique value proposition (UVP.) Put yourself in your investor’s shoes and imagine that your executive summary is the trailer for a movie, with your investor as the audience member. Would they be interested in seeing your movie?

Make a list of your objectives. Base your objectives on your business analysis. Investors will be looking to see if your goals align with their requirements. You’ll also need to figure out your exit strategy’s ultimate aim. To increase your company’s attractiveness, prepare a list of your financial needs and how the funds will be utilized. One of the most critical aspects of developing a startup business plan for your mobile app is ensuring that the process is as transparent as possible at every level.

– Business description

Starting with a description of your company and concluding with a summary of your mobile app idea, this section of your business plan for a mobile app helps introduce your business. This part will show investors what your company stands for and your mission is. It will also show them how you see your product and what you think are the most important factors for your success. Investors need to know this information now more than ever.

– An overview of the company

Here is where you should describe your company, covering the following points:

  • Type of business structure
  • Your company’s history
  • Location of your company
  • Team/remote team
  • Problem
  • Mission
  • Statement of the concept

Focus on the present situation of your project’s processes, such as the feedback from investors and lenders, in your mission statement. Defining how things are now while focusing on the future and your motivation in the vision statement are key components of the mission statement.

– The company’s history

In this section, you should describe the history of your business, the formation of your team, and how you came up with your idea. It’s also a good idea to talk about the main stages of your company’s growth and the experience that comes before the product goes on the market.

– Your team

Because your app development team is the core of the project, the team section of the company description is often the most significant section describing the company. Names, positions, job experience, and duties within the company should be included for each individual on your list of employees. You may also form a committee to assist you in making critical choices. It would help if you had experts on your committee who have previous industry expertise.

Analysis of the market

When it comes to bringing your app concept to life, information regarding the market’s current status should be your primary consideration. You should know what’s going on in your industry, have the most up-to-date information, and make a short-term strategy. In other words, you should have a market analysis in place. This part of your business plan shows how well your project will work.

– Market forecasts

When writing a business plan for a mobile app, forecasting is essential. Whether it’s for application development or a software startup, any business plan will benefit from forecasts from credible research organizations such as Nielsen, Forrester, etc. Besides that, you can include statistics on the growth of mobile application businesses and the amount of money invested.

A realistic market for your product, a sufficient number of consumers in a market, and, therefore, the willingness of those customers to spend a sufficient amount of money to have their issues solved are your primary objectives in doing market research. Determine whether or not the consumer believes that your unique application fulfills a requirement.

– SWOT analysis

Using a SWOT analysis, which is a kind of strategic planning, you can provide a structured description of your situation and identify opportunities and threats. Using SWOT analysis, you may investigate products, businesses, regions, and even whole countries. SWOT analysis is an acronym that stands for:

  • Strengths
  • Weaknesses
  • Opportunities
  • Threats

It’s very natural for a company to have flaws, and being aware of possible issues will serve as a powerful drive for finding answers and minimizing any risks your company may be required to take.

Marketing strategy

To get your product into the hands of your consumers, you need a solid marketing strategy in place. This requires convincing investors that you really have such a winning marketing plan. If you want to be successful with your mobile application, you need to use the following marketing strategies:

– Research the target audience

The first stage is to attract your target audience by identifying a specific group of consumers to whom you want to market your product or service. Demography, habits, online behavior, and lifestyle should be used to figure out who this target audience is. Analyze how your ideal client will interact with your app.

– Competition research is important

Competitor research is a critical component of business analysis. This information will assist you in highlighting the characteristics that separate you from your rivals and improve your processes and resolve problems in your marketplace.

– Create a landing page

A landing page for your mobile application can assist you in expanding your target audience as well as informing users about new features and upgrades to the app itself. Include the application’s name, a description of its capabilities, promotional videos, and other pertinent information on your page.

– App rating

If you want your app to show up higher in search results in the app stores, you need to improve it. For example, you can speed up the load time of your mobile app. A high ranking in search results will draw people’s attention to who could become customers.

– Product growth

There are many different approaches to growing their user base when it comes to app startups. In addition, each firm has its own business plan for entering new sectors. It only makes sense to launch a major advertising campaign, for example, in areas where customers are aware of your product or service benefits. Uber and Houseparty are two examples of apps that have done well with big marketing campaigns.

Business plan for mobile app - marketing strategy
Business Plan for Mobile App – Marketing Strategy

Financials

At long last, the moment has arrived when you can move on to the financial section of your business plan for the mobile app. Before you can go further, you need to know exactly what type of funding you’ll need. Furthermore, a prospective investor should understand the funding requirements when reading this section of your business plan for the mobile app.

Every major forecasted model is included in the financial model, typically a three- to five-year projection of all major forecasted models. These models include profit and loss statements, cash flow statements, balance sheets, start tables, and valuations. If you want to accurately assess the real cost of your assets and distribute them most efficiently, your financial record must have the following components: 

– Startup costs or funding required

Communicate with your investors about the expected cost of the project. Because such figures are subject to fluctuation, we recommend setting reasonable estimates and allowing for unexpected costs.

Costs of all kinds:

  • One-time cost
  • The costs that occur regularly (regular expenses, for example, rent and insurance)
  • Costs that are fixed (costs that will remain the same regardless of the state of your business)
  • Costs that are subject to change (e.g., salaries).

– Developing a monetization strategy

The following are some of the most prevalent methods of monetizing an application:

  • Advertising
  • Charging for the application: If your business model calls for a paid application, you must persuade the customer why they should pay and what they will be receiving in exchange for their money.
  • In-app purchases: This is a common way to make money with iOS and Android apps.
  • Using subscriptions to generate revenue is a common monetization approach, and it works until the user chooses to cancel the subscription. Most subscription applications provide an onboarding time or a free trial period.
Mobile app monetization
Mobile App Monetization Strategies

Monetization is a critical component when developing a business plan for mobile apps. To learn more about mobile app monetization, we recommend reading our thorough mobile app monetization guide.

Treinetic’s final thoughts on a business plan for mobile apps

Some people get very excited about ideas but don’t know how to make them real. They learn that mobile apps are profitable, so they learn mobile-related languages and frameworks. Then they try to do something they don’t know how to do. It’s as if they’ve already failed before they’ve even begun.

However, the steps outlined here should help you build a more successful app development plan. The fundamentals are monetization, financial metrics, and determining what makes your product stand out from the competition.

Offshore Developers Rates

Offshore Developers Rates | The Most Comprehensive Guide

To save money, you can outsource software development to a team of programmers in another country using modern technology. But you will need to better understand offshore developers rates for budgeting requirements. Offshoring also gives you access to a larger pool of talent from across the world. On the other hand, the typical cost of software development services varies substantially from country to country. When it comes to product development, several variables influence pricing. These include factors like the technology stack developers use, their experience, and the hiring method.

An analysis of offshore software development rates by country and level of experience will be presented in this post. Also, we give some advice on how to recruit offshore developers properly. We’ll be utilizing credible sources: SalaryExpert, Indeed, PayScale, Upwork, Toptal, and ourselves—YouTeam, a marketplace for on-demand engineering staff augmentation.

The Benefits of Hiring Offshore Developers in 2021

In addition to lower offshore developers rates, if you employ offshore developers, you will benefit from the following benefits:

  • Access to a large pool of IT talent. According to the Wall Street Journal, employers in the US had over 918,000 vacant IT positions in 2019. If your company is one of these, outsourcing may be a viable option.
  • There are no hidden fees. You just pay for the services since offshore software development is done remotely. Insurance, office space rent, incentives, and other fees become the responsibility of offshore developers or an intermediary agency.
  • You’ll have more time to devote to your project. Employees who work from home save time commuting and may devote that time to the project.

Offshore developers rates according to country/region overview

It would be best if you always kept in mind that typical offshore developer rates might fluctuate greatly from the accurate pricing of software development services, which is why:

  • When calculating the average rate, it considers the costs of various technologies. And some of which are more common and less costly than others.
  • Because developers with decent English, communication skills, and a proactive attitude are constantly in demand, they are paid more than the average.
  • The average cost is a combination of the rates of junior and senior developers, with the first group accounting for the lion’s share of the market. Employing a junior developer is less expensive than hiring a senior developer, which is a good thing for saving money. However, because the vast majority of the developers are junior developers, the average cost will be skewed somewhat in favor of the cost of a junior developer unless the data is appropriately weighted. 

And we tried to be as accurate as possible in this post about how much an experienced developer willing to work on international projects would cost at an hourly rate. We hope you find it beneficial.

Offshore Developers Rates by Region
Offshore Developers Rates by Region

Let’s now examine the market processes that have contributed to the present situation of the global software development industry.

Offshore developers rates and the current situation in the IT hiring market

Senior software engineers are in high demand among startups in the United States of America. A job opportunity for a junior or even medium post is quite unlikely. Many factors may be at play, including the requirement for excellent leaders in each function and the demand for startups to perform quickly to thrive in a changing market. Due to a lack of resources, it is hard to employ and manage a large development team or even get financing rounds that open up new possibilities. A similar trend exists in Western Europe (particularly Germany and the Netherlands), where many European startups are located.

There is a high demand for senior engineers in these regions and a limited supply, resulting in higher compensation and fierce competition for available resources. Most startups will have to hunt for workers in countries with lower living expenses if large corporations can afford to pay the highest rates. As a result, Eastern Europe, Latin America, Asia, and Africa have gained a reputation as offshore software development hotspots.

Last year, however, the whole world entered a new, pandemic-related digital age marked by rapid technological innovation. The ever-increasing tech trend has resulted in a massive demand for software development services in recent years. There was a talent shortage even in offshore outsourcing locations. It’s becoming more difficult to find an engineer with the right tech stack and 5–8 years of expertise. As a result, offshore development rates have risen to unprecedented heights. Let’s take a closer look at it.

How Did Offshore Software Development Rates Change Over Time?

This post was initially published on our blog in early 2020. However, since market circumstances are continuously changing, we periodically update this blog post. And in this latest version of the post, we compare the rates we previously mentioned to the current market pricing for software development.

Market circumstances change regularly. Offshore developer rates have risen by more than 7% for virtually all technologies since 2020, which is not surprising. In the case of senior developers, the percentage is much higher at 10%.

The technologies with the most dramatic rise were React Native, ReactJS, Python, Ruby on Rails, NodeJS, Java, and PHP. In comparison to the previous year, these developers received a payout rise of up to 15%.

Offshore Development Hourly Rates by Region in 2021

This section will give you an overview of the regions and offshore development rates by country so that you can make an informed choice when hiring from abroad. Eastern Europe, Latin America, Asia, and Africa will be discussed. To properly compare offshore software development rates with domestic software development rates, let’s first look at rates in Western Europe and the US, the two regions where the greatest demand for offshore software development services exists.

Software Development Rates in Western Europe and North America in 2021

According to Indeed.com, as of 2021, the average basic hourly wage for a software engineer in the United States is $46.32 per hour. This number may change based on various factors, including expertise, technology, and geographic location. Here are some state-by-state examples of rates:

Offshore Developers Rates Hourly - USA
Average Salary Per Hour in the USA

Similarly, rates vary per country in Western Europe, for example:

Offshore Developers Rates - Europe
Average Hourly Rates in Europe

Let’s look at the rates in offshore countries now.

Offshore Development in Eastern Europe in 2021

Offshore Developers Rates - Eastern Europe

Eastern European nations such as Ukraine, Belarus, Poland, and Romania are now among the top worldwide software development hubs, according to a study conducted in January 2019 by AVentures Capital, Aventis Capital, and Capital Times. IT exports from these countries totaled about $13 billion.

The Czech Republic, Hungary, Bulgaria, Croatia, Serbia, and Moldova are important contenders in this area.

Here are some other statistics on the situation of the IT sector in Eastern Europe:

  • The profit of the 477 IT businesses that took part in the study was $5 billion.
  • The yearly number of graduates from technical institutions is 60,000.
  • In the region, revenue growth is expected to be between 20 and 25 percent every year.

According to Coursera’s Global Skills Index 2020, Belarus, Ukraine, the Czech Republic, Poland, and Hungary ranked first in the technology category, including security engineering, operating systems, software engineering, databases, and computer networking and human-computer interactions. There are also several Eastern European countries, like Belarus, Hungary, and the Czech Republic, that have risen to global prominence in data science, including skills like Python and SQL.

Offshore Software Development in Ukraine in 2021

Ukraine has been attracting international investors since the late 1990s and early 2000s, when the first software outsourcing businesses began to develop due to its convenient location in the heart of Europe. Given the current situation of the IT sector in the country, the following statistics and information are available:

  • According to Ukraine’s State Statistics Service, IT service exports from Ukraine increased by 15% in 2019. It now accounts for 16 percent of total service exports, worth $15.23 billion to the country. Ukraine’s IT exports were expected to top $5 billion in 2020.
  • According to HackerRank test results, Ukrainian developers are ranked 11th in the world in terms of programming capabilities. More than 85% of IT workers have at least a basic command of the English language.
  • In Ukraine, there were over 160,000 IT experts engaged at almost 4,000 IT enterprises as of 2019. By 2021, the number of IT experts will have risen well above 200,000.
  • The IT sector in the country is increasing at a rate of roughly 26% per year.

According to the rankings of offshore development rates by country, Ukraine has a lot to offer when outsourcing software development.

Poland as an Offshore Development Destination

Poland is one of the most costly nations to outsource software development in the Eastern European region. It is also one of the region’s most secure and stable economies. The Polish government is a staunch supporter of the IT sector. As a result, numerous major firms, including Google, Intel, and Siemens, established R & D operations in Poland.

This country’s membership in the European Union is one of its most valuable assets. As a result, it is particularly appealing to Western European businesses that share legal and geographical space.

In addition to its own IT graduates, Poland is continually expanding its talent pool by headhunting the brightest engineers from Ukraine. Many software outsourcing firms operate in the Polish and Ukrainian markets, allowing engineers to quickly transfer to nations with lower living and software development rates.

Eastern European Software Engineer Hourly Rates in 2021

When a company is looking for a long-term partner, the cost of development is critical. An important consideration when considering an outsourced location is the ability to establish trusting working relationships with your developers. For your convenience, we merged the average hourly pay for software developer talent in various Eastern European nations with the World Bank’s assessment of political stability and ease of doing business.

Offshore Developers' Rates - Eastern Europe
Developers Average Hourly Rates in Eastern Europe

Software Engineers’ Average Hourly Rates in Eastern Europe in 2021

As previously said, when a company is hunting for a long-term collaboration, the cost of development is quite crucial to consider. At the same time, the capacity to establish trusting connections with your offshore developers is an even more important factor to consider when selecting an outsourcing region. For your convenience, we integrated the average hourly pay for software development talent in other Eastern European nations with a World Bank score of political stability and ease of doing business.

Latin America’s Offshore Development in 2021

Offshore Developers Rates - Latin America

According to IDC, despite political instability and poor economic growth, the Latin American IT market will rise in 2021. The IT market was expected to grow by 4.8 percent in 2020, according to Ricardo Villate, vice president of the regional consultancy. According to IDC, business expenditure on 3D printing, cloud, AR/VR, AI, IoT, security, and robots has increased.

According to Coursera, Argentina and Chile are among the top 30 countries in the world for data science (Machine Learning, Data Management, Data Visualization, and Statistical Programming).

Offshore Software Development in Brazil in 2021

In Latin America and South America, Brazil is one of the top software outsourcing countries. According to a previous survey by Agile Engine, Brazil has the most software developers in the region, with over 400,000. The Tholons Services Globalization Index 2019 ranks Brazil second among the world’s top 50 digital countries. In 2021, the average hourly wage for a software engineer in Brazil was $44.

Latin America’s Top-Performing Outsourcing Destinations

Engineers are often sought from outside Brazil, even though Brazil is South America’s largest country. And, as a result, has the region’s largest pool of available workers. The basic explanation for this is that Brazil is the only country in the world where the majority of the population speaks Portuguese. While the rest of the continent speaks Spanish, it’s simpler for enterprises to extend their recruiting to several nations because their foreign engineers will be able to communicate with one another in their native language.

Mexico, close to the United States, is one of the most preferred nations for nearshore software development. Why? Because its engineers are accustomed to dealing with US customers and have a thorough understanding of their corporate culture.

Argentina and Panama are the second and third offshore development nations in the area that we wish to highlight.

  • As per the same analysis by Agile Engine, Argentina is rated 14th among the top software outsourcing nations and second in the region. According to the Tholons Services Globalization Index 2019, it is also the tenth most digitally advanced country.
  • According to the World Bank Group, Panama has been one of the fastest-growing global economies in recent years, with great technological advancement in the IT business.

Average Developer Hourly Rate by Country in Latin America in 2021

According to the most recent statistics, the average annual wage for software developers in Latin American nations is greater than in Eastern Europe; however, stability ratings are lower.

Offshore Developer's Rates - Latin America
Developers Average Hourly Rates in Latin America

Offshore Software Development in Asia in 2021

Offshore Developers Rates - Asia

Offshore development rates are very reasonable in Asia compared to other regions. As a pioneer in software outsourcing, Asia has the largest number of offshore software developers of any region. This figure was around 3 million in India alone in 2018.

China is also an appealing offshore development destination. Across all HackerRank challenges, Chinese developers come out on top. The Chinese government provides economic incentives to the IT industry. More than 50 scientific and technological industry parks have since been established around the country.

Cebu City in the Philippines has the fastest-growing IT sector, with over 200 offshore enterprises and 95,000 tech jobs available. In the Tholons Services Globalization Index 2019, the Philippines is ranked 5th among the top 50 digital countries, with Manila as the world’s second-largest metropolis.

Offshore Software Development in India in 2021

According to the Tholons Services Globalization Index 2019, India is one of Asia’s leading software outsourcing countries and a top digital nation. One of the most cost-effective ways to outsource web development is through Indian software development companies. More than 100,000 IT professionals graduate from the country’s technical institutions each year. As of 2016, India was ranked second in the world for the number of STEM graduates, with 2.6 million. In India, the developer’s average hourly wage is $30.

On the other hand, there have been cases in India where junior developers eager to get started in their careers leveraged themselves with the lowest pay rates possible. Under such low pay rates, under-skilled developers working on complex projects have made those projects fail.

Offshore Developers Hourly Rates by Country in Asia in 2021

Other Asian nations’ offshore development rates for 2021 are as follows:

Offshore Developers' Rates - Asia
Developers Average Hourly Rates in Asia

Offshore Software Development in Africa in 2021

Offshore Developers Rates - Africa

Although Africa’s IT outsourcing sector is still in its early stages, it has already shown fast development and is drawing international customers. The growing number of young people in the region would increase the demand for high-quality service sector employment. The country will soon be among the finest places to outsource software development.

  • It has swiftly become a prominent outsourcing destination because of its time zone consistency with Europe and a short time difference with New York, as well as North Africa, notably Egypt, Morocco, and Tunisia. Furthermore, because of their similar language, Morocco and Tunisia draw consumers from France. Python, Ruby, and SQL are just a few of the technologies that North African programmers are familiar with.
  • Due to minor time zone variations and good English, German, and Dutch competency, South Africa is another attractive option. The Tholons recognize the region as a Digital Nation and a Super City to top it all off. And South African developers are comparatively fluent in C++, PHP and SQL.
  • Africa’s east Kenya has a disproportionately high number of programmers. This may be because Nairobi acts as a hub for international businesses to reach Africa.Thousands of Kenyan enterprises call Nairobi home. And the city’s infrastructure fosters technological innovation among emerging firms and startups. East Africans are reputed for their skills in working with Java, SQL and in Mobile Development.

Despite this, African nations have the lowest worldwide skill rankings.

Offshore Development Rates by Country in Africa in 2021

According to a recent study, the hourly pay of a software developer in Africa is much lower than in any other outsourcing market. However, you will pay a larger price in terms of risk since this region has the lowest stability index.

offshore developers' hourly rates - Africa
Developers Average Hourly Rates in Africa

Sri Lanka as an outsourcing destination 

Sri Lanka has risen to the top of the list of outsourcing destinations for knowledge-based projects. And this because of huge tax benefits, a booming GDP, and favorable trade relations. When it comes to high-quality software products, Sri Lanka has developed and established a reputation for excellence. The National Outsourcing Association has recognized and shortlisted Sri Lanka several times as the “Offshore Destination of the Year.”

The IT industry in Sri Lanka has been one of the most robust throughout the COVID-19 crisis, with exports growing at an annual rate of 8%. Over 300 Sri Lankan software businesses exist now, accounting for 90% of the country’s IT exports. Sri Lanka has long been regarded as a center for the worldwide IT and business process outsourcing (BPO) industries. The IT/BPO industry accounts for 13.2% of service exports, behind the textile and tourism sectors. Sales have surpassed the $1 billion US mark. 

Moreover, because of Sri Lanka’s high literacy rate, the country’s information technology industry has emerged as the most efficient, competent, and financially appealing sector, among many others. For more than a decade, Sri Lanka ranked first among the countries in the South Asian area in terms of outsourced development. Moreover, it was the preferred destination for many US, European, and Australian corporations looking to outsource development.

The advantages of employing Sri Lankan software developers

The following are some of the factors that contribute to Sri Lanka’s popularity as an outsourcing destination:

  • Global Services Magazine has named it as one of the top 10 emerging global destinations.
  • The National Outsourcing Association has recognized Sri Lanka as the “Offshore Destination of the Year” for many consecutive years.
  • It is one of the top six offshore service destinations in the Asia-Pacific, according to Gartner’s ranking of the world’s leading destinations for offshore services.
  • In 2017, the A.T. Kearney Global Services Location Index (GSLI) ranked Sri Lanka as the 11th most desirable location for financial attractiveness, people skills and availability, and business environment.
  • According to the IBM Global Location Trends Report, the country ranks 12th among the top-ranking destinations.

Quality is also a trademark of Sri Lanka’s well-versed IT business. As a result, Sri Lanka has established a reputation for greater software product quality compared to other offshore outsourcing destinations due to a consistent stream of product deliveries over time.

Furthermore, outsourcing these development projects to Sri Lanka improves efficiency and competitiveness. 

Hourly Rates for Developers in 2021, based on Technology and Experience

Treinetic has compiled data on the average hourly cost of software development depending on technology (e.g., NET, JavaScript, Python, etc.) Because the data in the table below is compiled from several outsourcing organizations and hundreds of developer profiles from across the globe, it provides a fair depiction of software development pricing.

Offshore Developers Rates Based on Technology
Offshore Developers Rates Based on Technology

Treinetic’s final thoughts on offshore developers rates  

It might not be easy to find a team of software engineers for your project. This is very relevant for those in the United States or Western Europe looking for IT talent in their area. Finding suitable individuals at an affordable price may take a long time. If you are new to remote hiring, it is crucial to learn about the best nations to outsource software development and offshore software development rates by country.

To give you an idea, here’s what you’d pay a mid-level developer in an offshore region:

  • $24-$35 in Asia
  • $30-$40 per hour in Eastern Europe
  • $30-$47 per hour in Latin America.
  • $22–$30 in Africa.

The lower cost of living in offshore countries is responsible for this inequality in income. Although you will often obtain the same quality as local experts, you must be cautious when selecting a place to outsource software development services. If you want to speed up the development process and minimize unforeseen costs, you can employ an award-winning offshore development team

Please get in touch with us immediately. And we’ll be pleased to provide you with additional information about managing outsourced development.

Scrum vs. Kanban

Scrum vs. Kanban | What are the Differences?

When it comes to implementing an agile development or project management system, “Kanban vs. Scrum” is a hot topic. In contrast to Scrum’s structured, short work sprints, Kanban’s methodologies are more fluid and undisrupted.

The differences between scrum and kanban practices are simple to point out, but the demarcation between them are obscure. Even though the practices change, the principles are essentially the same. Both frameworks will assist you in developing better products and services while experiencing fewer problems.

Scrum vs. Kanban: What are the Differences?

Because both Scrum and Kanban come under the Agile methodology umbrella, they are excellent frameworks for breaking down bigger, more complicated projects into manageable portions. Let’s compare the two to address the Scrum vs. Kanban debate.

When discussing Scrum vs. Kanban and their differences, we must first understand them separately.

What exactly is Scrum?

Known as the Scrum project management framework, it is used to implement the Agile project management methodology. This is a common approach for projects that demand fast development, testing, and release of products.

The Scrum framework divides a project into short sprints of usually one to four weeks. At the end of each sprint, a Scrum team, usually led by a Scrum master, strives to produce an increment. As part of the Scrum methodology, teams gather daily for daily Scrum (standup meetings) to review progress and improve collaboration.

What is a Scrum Board?

A Scrum Board is a management and monitoring tool used to manage and monitor your Scrum project. Visualizing your product backlog, assigning items to your sprint backlog, and seeing how work is moving in your current sprint are all made easier by this tool.

Though they might be physical boards with sticky notes or cards attached, most Scrum Boards are digital and present in many project management systems.

According to Procurify, a purchasing software start-up based in Canada, organizing their sprints with the help of a collaborative platform saved them 70% of their time. Also, with the ability to see each other’s work, team members can cooperate with people from various departments.

Scrum vs. Kanban - Scrum Board
The Scrum Board for Project Management and Monitoring

Some advantages and disadvantages of using the Scrum approach and Scrum Boards to manage your projects are as follows:

Advantages:

  • Rectifying mistakes and avoiding future problems is possible.
  • A transparent process is made available to clients, who may follow it from beginning to end.
  • The ability to measure and evaluate the individual performances of each team member. 
  • In part because of its simplicity, Scrum helps to cut off some costs that would have been inevitable if an alternative agile approach had been followed.
  • Because of the short sprints and regular feedback, it is convenient to make changes.
  • As the process becomes more flexible, you can make changes at any point in the process.

Disadvantages:

  • Because it is iterative in nature, it needs constant feedback from the team to enhance the process.
  • To accomplish this process, the team must have a high level of confidence in one another. If the governance is very rigorous, the project as a whole may fail.
  • It does not have a predetermined time limit or cost valuation, which may require numerous sprints to produce an artifact.
  • Team members can be  under increased pressure, and they might have to devote a significant amount of time to project development.
  • It is difficult for a team member to leave throughout the procedure.
  • Scope creep may occur if no deadline is specified.

What exactly is Kanban?

To understand the difference between Scrum vs. Kanban, let’s see what Kanban is.

Kanban is another prominent Agile framework that has gained popularity recently. Unlike Scrum, however, Kanban is less time-based and is focused instead on managing the volume of work in process (WIP).

To guarantee a continual flow of productivity, the Kanban framework was created to ensure that no one on the team is overworked or overburdened. It assists project teams in reducing bottlenecks, increasing efficiency, improving quality, and increasing total productivity, among other things.

What is a Kanban Board, and how does it work?

“Planned,” “In Progress,” and “In Review” are all presented on a traditional Kanban planning board or chalkboard. After that, each delivery is put down on a sticky note and assigned to the appropriate status. The sticky note moves across the project status whiteboard as the deliverable progresses through the phases.

Scrum vs. Kanban - Kanban Board
An Illustration of the Kanban Board

The following are some advantages and disadvantages of utilizing Kanban as the development framework to manage your projects:

Advantages:

  • It assists in pushing work that is often “stuck” through to completion.
  • It’s simple to set up and put into action anywhere.
  • Workers’ workloads are clearly visible and readily adjustable.
  • It’s excellent for categorizing tasks according to who is doing them.
  • It is particularly well suited for deliverables whose status is heavily reliant on the state of the other.
  • You can rapidly assess and analyze the overall productivity of your team.

Disadvantages:

  • Because there are no time limitations, the delivery of deliverables may be more unhurried.
  • If the team is underperforming, and it is not immediately obvious to the Kanban lead, the project may easily end up in a disaster.
  • Outdated Kanban boards may harm productivity.
  • When working with the classic whiteboard organizing scheme, it might be difficult to distinguish between real work and the board itself.

Kanban vs. Scrum: What are the differences?

It is important to note that Kanban and Scrum are both project frameworks designed to assist teams in adopting the Agile methodology, values, and principles. As a result, they share several characteristics. Process improvement, team collaboration, and breaking projects down into smaller and more manageable portions are all encouraged by both frameworks.

However, when comparing Scrum vs. Kanban, we can observe that the two methodologies take quite different approaches to implementing these ideas. Five critical ways that Kanban and Scrum differ are listed below:

Scrum vs. Kanban Roles and responsibilities

There are clearly defined duties and expectations for each of the three specific roles in the Scrum methodology.

Scrum masters serve as facilitators and coaches for the team. Their role is to assist in removing bottlenecks and ensure that the team continues to move ahead on the proper course.

Product owners are in charge of developing the product roadmap and ensuring that the demands and preferences of consumers are accurately translated into functional product features.

Scrum team members are responsible for the majority of the project’s work. They are a self-managed team that is responsible for the preparation, execution, and evaluation of project sprints and their results, among other things.

Kanban does not prescribe roles in the same way that Scrum does. Team members should maintain their current roles and responsibilities according to one of the four Kanban principles. This notion holds that teams will more quickly accept the framework if they are not required to worry about changing job titles and descriptions. So, this is a major difference to highlight when reviewing Scrum vs. Kanban.

Scrum vs. Kanban: Delegation and prioritization

Delegation and prioritization are important factors to consider when comparing Scrum vs. Kanban. Scrum is a project management methodology built on the principle of self-managed teams. Because they represent the client’s demands, the product owner may eventually have the last say on which features or tasks are prioritized on the product backlog (a list of all the features, tasks, and work that has to be done on the project). However, the whole team contributes to the decision of which tasks will be done in a sprint.

Similarly, Scrum team members often have complete autonomy when doing their tasks within a given sprint. They have control over which things they work on. However, it is possible that those decisions can be affected by collective decisions at scrum meetings. And when they work on them, as long as everything is completed by the end of the sprint.

Even though Kanban supports cooperation and leadership at all levels, it does not embrace the self-managed team to the same extent as Scrum does. The fact that Kanban encourages teams to preserve their prior responsibilities means that previous team configurations often govern how delegation is handled.

A typical manager’s responsibilities include prioritizing tasks and actively managing the workflow. Depending on the situation, they may assign particular duties to specific personnel or allow them to be done on a “first come, first served” basis.

Modifications and changes

When explaining the difference between Scrum vs. Kanban, we can see that they handle modifications and changes in very different ways.

Scrum necessitates that a sprint be planned before starting, that the team performs its task, and that the sprint concludes with product delivery and evaluation. Customer feedback, problems, bugs, and desired modifications are subsequently added to the main product backlog and prioritized for inclusion in future sprints.

In most cases, changes identified in the middle of a sprint are not handled until the next one, unless they are of such a magnitude that they need to be addressed immediately,  where the sprint is terminated. The sprint duration will not alter as a result of this method. However, if there are enough change requests, extra sprints may be required to be added to the overall project schedule.

When using Kanban, it’s okay to make adjustments at any stage in the process, and making changes right away is really encouraged. Depending on the degree of the modification, this might influence the project’s timeframe.

Toyota initially developed Kanban for automobile production, and it is now widely utilized for a variety of tasks and bits of labor that are repetitive in nature. When dealing with this sort of situation, when items are interchangeable, the focus is on providing a set volume rather than a specific piece of work. It’s common practice to discard or modify a product that’s been discovered to be broken/faulty or running behind so that it can be put back into production.

Productivity measurement

Scrum measures productivity using indicators such as velocity and burndown rates.

  • In a sprint, velocity measures how much work a team does in one delivery cycle.
  • Using burndown charts, you can see how much work is still left to be done as a graph of task estimates vs time.

The combination of these tools helps highlight how productive the team has been so far and how prolific they must continue to be to finish the project on time.

It is common for Kanban to track cycles, lead times, and work in progress to gauge productivity.

When it comes to cycle time, it is the amount of time it takes a job to complete from the moment it is started. An average of how long work has been in progress is used in this calculation.

In general, lead time is a metric that counts the amount of time it takes from the moment a task is recognized or put on your Kanban board until it is finished.

Consider the following scenario: you were assigned a task on Monday morning, began working on it on Wednesday morning, and finished it by the end of the day on Friday. Using the example above, your lead time (Monday to Friday) was five days, and your cycle time was three days (Wednesday to Friday).

“Work in progress” is a metric that represents the average volume of tasks currently being worked on your Kanban board.

Scrum vs. Kanban: Due dates and delivery timelines

When comparing Scrum vs. Kanban, the due date and delivery deadline are two important elements to consider.

Scrum sprints are generally one to four weeks in duration, and at the conclusion of each sprint, a product increment is delivered. Any accompanying documents, such as training materials, would be supplied at the same time as the main package. Due dates or deliveries that fall in the middle of a sprint are slightly uncommon.

In the case of interdependent tasks allocated to the same sprint, the exception would be allowed to stand. If job B cannot begin until task A is finished, task A may be assigned an earlier due date to guarantee that both tasks are completed on time for delivery. Many times, there isn’t even a formal due date specified, and the team just handles these dependencies during their regular daily scrums.

Continuous delivery is at the heart of Kanban’s philosophy. Kanban teams often work on projects, items, or deliverables that are unrelated to one another. This allows for immediate delivery of finished products to the customer once a piece of work is done.

Teams have the option of grouping deliveries to avoid sending one item at a time. However, this is entirely up to the teams themselves. For example, you may decide to ship every Friday or every time you reach a total of 20 finished items.

Kanban’s major emphasis on cycle time and lead time, rather than which piece of work is due, tends to concentrate on cycle time and lead time. As a result, due dates are more often based on target turnaround times than on when consumers anticipate deliveries to be made available.

Scrum vs. Kanban - Comparison Summary
Scrum vs. Kanban – Comparison Summary

When it comes to planning a project, which project plan board and framework are the most effective?

Whether or not you should utilize Kanban vs. Scrum depends on the sort of project you’re working on. Scrum and Kanban are two frameworks that are best suited for projects of different types and scopes.

However, here’s a quick breakdown of the situation:

Scrum is a better framework and project planning board for one-off projects with numerous variables and uncertainties. It supports working equally well for one-off projects with deadlines as it does for other projects.

Kanban is a more effective framework and project plan board for projects that you’ve done previously or that are recurrent, include numerous deliverables, and need to keep a close watch on individual capability and performance.

Scrum vs. Kanban: Does it have to be either-or?

Scrumban is a third option that may be considered. Teams that find Kanban too flexible and Scrum too rigorous would benefit from this mix of the two frameworks, which offers a happy medium for them. And we will address this in more detail in future postings, just as we did when we examined Scrum vs. Kanban in this post.

At Treinetic, we know that change is unavoidable, no matter what project you’re working on or who you work for. Embracing an Agile approach is the first step toward boosting communication, continually refining procedures, and having that flexibility built in. Therefore, you and your team are prepared for anything that comes your way. Agile methodologies are becoming more popular.

Software Development Pricing Models

Software Development Pricing Models Comparison Guide

It takes more than simply writing code to build a new piece of software. Architecture, requirements analysis, design creation, and testing are all steps in this process. The solution is then implemented. Businesses intending to build an application should be aware of the many software development pricing models currently available on the market to make an informed decision. That way, you’ll be able to choose the best option for your project and get the most out of your collaboration with a software development firm.

In this post, we’ll look at the three main software development pricing models, as well as their variants.

It’s worth noting that there’s a huge variety in this market, with numerous models, hybrids, and even name variations. Furthermore, in the contracts prepared by software development agencies, one model may be implemented in various ways. That is why our list is far from complete. It is, nonetheless, a valuable source of knowledge about the most commonly used software development pricing models today. And with this information, you’ll be able to make informed decisions regarding the price plan for your app development.

Software Development Pricing Models and Variants 

1. Fixed-price model

Additional variants include fixed-budget, fixed-time, and fixed-scope

2. Time and material software development pricing model

An additional variant is the milestone pricing model.

3. Dedicated team

The model has three variants: offsite, onsite, and outstaffing contract.

So let’s have a look at the pros and cons of each of these software development pricing models now. 

1. Fixed-priced software development pricing model

This software development pricing model adjusts the development process based on cost and time predictions based on the project parameters. The budget, specifications, and date of delivery are fixed here. Most projects have a predetermined timeline and set of goals that serve as a basis for calculating payments.

To guarantee that the project is completed on time, it is important to clearly define the scope of the work and establish milestones for completion in advance.

Such a model, on the other hand, makes risk management problematic. It is important to remember that the provider is accountable for the whole management process in this instance. Therefore, it may not be easy to monitor the project’s progress.

During development, unexpected events may occur, including:

Every time you try to change the scope of the project, you will encounter challenges. You’ll need to modify the contract and come up with new conditions to meet your needs. Your product’s time-to-market will increase as a result of this.

If the team comes up with a brilliant new product or solution that would add significant value to your business but needs more time, they may not be able to share this information with you. And that’s because under the fixed-price software development pricing model, the original plan must be adhered to.

Because the agency can’t lose money, the team will work around the clock to meet the agreed-upon scope. In this case, you might forget about better code quality and a robust quality assurance procedure. To meet a deadline, the team must provide a specific scope of work on time; if anything unexpected comes to light, the quality will suffer the most.

The above scenarios make collaboration with your software development firm difficult. 

What are the possible outcomes?

  • Because they can’t fully use their skills and expertise, the team will only work half-heartedly.
  • Even though you’ll precisely get what you requested, it won’t be the best product you could have had.
  • You’ll have a hard time making modifications.
  • The team will not provide any ideas that would be beneficial.
  • In this case, you won’t be completely satisfied with the result because of the quality of the product.

When should you use a fixed-price software development pricing model?

  • Your project is small and has a short timeline (lasting less than two months).
  • You don’t care about being a part of the development process or having a say in how it proceeds. You’d rather agree on everything upfront and then hand the project over to the team as a whole.
  • If you wish to work with a new provider, you can set up a short pilot project to see how the firm performs before employing them for a major, long-term project.
  • For your project, you’ve got all the technical specs and a well-developed strategy, as well as wireframes, user journey maps, and user stories in place, so you’re ready to get started. Naturally, it would be beneficial if you had plenty of time to prepare these papers.
  • There is no doubt in your thoughts that the project’s requirements will not alter in the future.

What do you pay for?

So long as the fixed-price project is completed as per its initial estimates, you pay just for the amount of work agreed upon in advance.

The contract should clearly outline your and the provider’s duties, such as deliver data, feedback from testing, and quality standards. Every time you go above and beyond what was originally agreed upon, you’ll have to pay a fee.

Additional variants of the fixed-price software development pricing model include:

1. a) Fixed budget pricing model

This software development pricing model has a set budget, but the timeframe and scope of the project may be altered throughout the development process. A very limited amount of money is available for this project. Because of this, the software development company will work on building the best possible solution for this budget. Feature and scope changes are possible, but not at the expense of budget changes.

When should you use a fixed-budget software development pricing model?

  • You are on a tight budget
  • Because your product specs aren’t set in stone, and your project deadlines are open to constant optimization, you and your team may keep the project scope as fluid as necessary.

What do you pay for?

Regardless of the scope of the project or the delivery date, you pay the agreed-upon amount.

1. b) Fixed-time software development pricing model

It focuses on a team’s ability to provide the product on time. Project parameters like scope and budget may be adjusted, but the deadline for delivering a solution remains fixed.

When is a fixed-time model appropriate?

  • The most important factor is time, which you estimate to be two months in most cases. Do as much as possible at that time.
  • Getting your product out into the world quickly is something you’re after.
  • You expect the solution to be completed within the given period.

What do you pay for?

When you hire a team, you pay for the number of hours they work on your project within the agreed-upon period.

1. c) Fixed-scope software development pricing model

The project scope is set in this model and cannot be amended throughout the project. Nevertheless, the team has some discretion under your guidance in terms of product delivery timelines and budgets.

When should you use a fixed scope pricing model?

  • You’re looking for a specific product, and you know precisely what you want.
  • Your team may constantly adjust both your delivery time and your budget based on your needs.

What do you pay for?

When you hire a team, you’re paying for the time it takes to complete the agreed-upon scope of work.

Fixed-Priced Model
The Fixed-Priced Model Comes with Several Benefits for Short-Term Development Projects

2. Time and material software development pricing model

The time spent on your project and the cost of the materials are accounted for in the time and material software development pricing model. Contracts like this one provide a great deal of time, scope, and financial flexibility, although early estimates have been established. Payments are paid regularly, such as once a month, for example.

The main benefit is that this software development pricing model enables you to easily adjust the requirements and change the work plan without incurring any high costs. This pricing model is an ideal fit for software development teams using current agile approaches (such as the Scrum methodology.)

Furthermore, you’ll be able to track the progress of the team during the whole development process. In this way, you have a better chance of obtaining exactly what you’ve been looking for.

When to use a time and material software development pricing model?

  • You have a hard time figuring out the final specifications of your product at the outset.
  • You’d want to get started on development as soon as possible.
  • You’re hoping to have a say in how big the project will be and how much money you’ll be able to spend.
  • In order to ensure its success, you wish to be an actively involved product owner who has a significant impact on the development of the application. 
  • Project specs and requirements are constantly evolving.
  • You don’t have a set deadline for the project.
  • It will take more than a stated number of months to develop your product. .

What do you pay for?

In this software development pricing model, you pay for the real time the team spends on particular tasks and the cost of everything they use to deliver your product in this pricing model (e.g., access to a specific tool).

Another variation of the time and material pricing model for software development is:

2. a) The milestone pricing model

The scope, price, and time frame of the project are all flexible and adjustable. For example, the client gets invoiced after the service provider has completed the task in a certain time frame, accomplishing an agreed-upon milestone. Good news: You have to pay for basic features and approve each milestone before work can proceed in this model.

When should you use a milestone software development pricing model?

  • You have a solid working relationship with the service provider.
  • There’s an established relationship with the provider that reduces both time and the risk of disputes by streamlining the acceptance process.

What do you pay for?

You pay for the development of certain features within a previously set milestone in this model. The amount directly reflects the time invested by the provider’s team in achieving a certain goal.

Software Development Pricing Models - Time & Materials
The Process of the Time and Material Development Model

3. Dedicated team software development pricing model

For a dedicated team, you pay for the time the team members spend working for you. Management of your work is your responsibility. The pricing is based on the hourly rates of the specialized team’s developers. It includes the monthly wages of all employees recruited, plus additional administrative costs.

Using this software development pricing model, you have a great deal of control over the team and can manage them, such as determining the workload. You also receive the privilege to pick your team members from a list of possible candidates provided by the service provider.

This model is comparable to forming an in-house team, except that you can increase or decrease the number of team members. For one thing, you don’t have to hire people and spend money on things like vacations and workspaces for them. As a result, you can flexibly increase or decrease the size of your team over time.

What do you pay for?

For a dedicated team, the monthly salary for each employee is included, as well as additional fees for administrative purposes (called the “management fee”). Monthly payments are the standard. The contract should specify the salary and the fee. You’ll know the monthly cost of your project based on the team’s makeup.

This software development pricing model comes in three variants:

3. a) Offsite dedicated team software development pricing model

In the offsite model, the team works on the premises of the provider, and it is common for the development team to be based in another country.

When should you use an offsite dedicated team software development pricing model?

Same as the dedicated team price model, but with the addition of:

  • You’re planning a long-term project with unclear requirements.
  • For a large in-house project, you’re looking for a solution that doesn’t require hiring full-time employees.
  • You’re OK with the fact that you’ll be managing the team remotely.
  • Process management is a skill that you have, or you have a team member responsible for it.

What do you pay for?

Same as the dedicated team software development pricing model.

3. b) Onsite dedicated team pricing model

The development team collaborates closely with the rest of your in-house team members on your premises.

When to use an onsite dedicated team software development pricing model:

  • You want to start a long-term project with unclear requirements.
  • Your company has a large in-house project, and you’d want to boost your internal team, but you don’t want to recruit additional full-time employees.
  • Face-to-face contact is vital to you, and you want to work with the team in the same place.

What do you pay for?

The price plan is similar to that of a dedicated team software development pricing model.

In the dedicated team models, the team may have a project manager assigned to it by the service provider. This individual will report to you or the person in charge of the project at your company. It all comes down to the terms you agree to.

3. c) Outstaffing contract pricing model

Hire a team from an outstaffing service to work on your project at either your office or the provider’s.

An outstaffing provider identifies the team members you need based on the number and qualifications of the team members you specify. Teamwork is similar to an in-house team, except that the provider takes care of administrative duties.

This software development pricing model closely resembles the dedicated team model. Here, you don’t use a software agency to find developers but rather an outstaffing provider.

Note: If you assign the duty of recruiting engineers to a software development business, the team may develop a set of methods and workflows that may be used for your project to increase team member productivity. This isn’t something you’ll often find with an outstaffing service.

When should you use an outstaffing contract software development pricing model?

  • You’re about to embark on a major project with unclear requirements.
  • This means that you’re prepared to manage your team and assign duties to team members.
  • An outstaffing service may avoid the need to look for a software house; instead, you may choose to employ their services.
  • You have a large internal project and want to strengthen your internal team to produce a great product—but you don’t want to recruit more full-time professionals.

What do you pay for?

It is no different from a dedicated team software development pricing structure.

Software Development Pricing Models - Dedicated Teams
The Dedicated Team Model Is a Good Choice for Complex, Long-Term Development Projects

Wrapping things up: how to choose the right pricing model for software development?

There are pros and cons to each of the pricing models mentioned. It’s up to you to make the final choice based on the requirements of both your project and your business.

These are the most important considerations:

  • The complexity of your project
  • How many employees would you want to get on board?
  • Your budget?
  • Duration of the project
  • What level of control do you expect to have over the team?

Fixed-price models and their variants aren’t worth considering for long-term projects. 

Treinetic’s Thoughts on Software Development Pricing Models

Because we mostly work on long-term projects, we often employ time and material software development pricing models. Our years of expertise in the industry have convinced us that this contract is the best option for developing mobile and web applications.

Are you looking for an award-winning team of experts that can help you get your idea off the ground? Get in touch with one of our experts now. We assist businesses like yours in determining the most appropriate software development pricing and cooperation models for their needs.

React Native VS Flutter - What to Choose in 2021

React Native VS Flutter: What to Choose in 2021

Do you wish to speed up the development of your apps? Cross-platform development may save you money, but which of the two technologies – React Native VS Flutter – should you use? According to Statista, React Native and Flutter have been the most popular cross-platform mobile app development frameworks for the last two years. Their adoption rate keeps increasing, and they’ve already surpassed their competitors.

We’ll go further into the Flutter vs. React Native debate and ask the experts which is the best for 2021 app development and why.

Flutter VS React Native: A Developer’s Perspective

React Native is a Facebook-initiated project that the company made open-source in 2015. On the other hand, Google launched a project called Flutter in 2017, which they have successfully pushed ever since. In both cases, app developers may use a single programming language to create cross-platform applications more quickly. There is already a large community for React Native, but Flutter has been gaining popularity since 2017.

React Native VS Flutter Overview
React Native VS Flutter – A Quick Overview

We’ll look at different factors to see how they compare in this article:

  • Programming language
  • Technical architecture
  • Installation
  • Setup and project configuration
  • UI components and the development API
  • Developer productivity
  • Community support
  • Build and release automation support

With our criteria established, it’s time to go further and learn more about each of them in-depth.

React Native VS Flutter: Programming Languages

Using cross-platform mobile app development, you can create applications for iOS and Android with a single programming language.

React Native — JavaScript

React Native is a cross-platform application development framework that makes use of JavaScript. At present, JavaScript is a highly popular language in the web community. It is often used with other well-known JavaScript frameworks like React. Web developers can now create mobile applications with little training, thanks to React Native. As a result, businesses embraced React Native without hesitation. Dynamically typed programming languages like JavaScript allow you to accomplish almost anything. This is both good and problematic.

Flutter — Dart

Flutter makes use of a programming language developed by Google in 2011. Dart’s syntax is simple to grasp for JavaScript or Java developers since it supports most object-oriented ideas. Dart’s official website has excellent, simple-to-follow documentation that makes getting started with the language a breeze.

React Native VS Flutter: Programming Language Analysis & Results

Most web developers utilize JavaScript, making it simple to switch to the React Native framework. Dart has a robust feature set, but it is less widely used and less well-known in the development community. This means that when comparing React Native VS Flutter, React Native comes out on top in the programming language stakes.

Score: React Native 1 — Flutter 0

React Native VS Flutter: Technical Architecture

Technical architecture is an important factor to consider when selecting a cross-platform mobile app development framework. We can make an informed choice and choose the framework that is best for our project if we are aware of the framework’s internals.

React Native — Flux

The React Native architecture is heavily reliant on the architecture of the JS runtime environment, namely the JavaScript bridge. At runtime, the JavaScript code is compiled into native code. React Native takes advantage of Facebook’s architecture. To put it another way, React Native communicates with the native modules through a JavaScript bridge.

Flutter 

Flutter comprises two main components: a software development kit (SDK) and a framework with a widget-based UI library.

In a nutshell, a framework is a widget-based UI library that includes reusable UI elements like sliders, buttons, and text inputs, among other things. Depending on your requirements, you may subsequently customize these elements further.

An SDK is a collection of tools for creating apps and compiling them into native machine code for iOS and Android.

Flutter requires the Dart programming language, which Google developed in October 2011. It has evolved significantly since then, and it is still one of the best options for creating mobile and web apps today.

C++ is the predominant programming language for the Flutter engine, which remains at the heart of the framework. The low-level implementation of the Flutter API, such as accessibility support, the Dart runtime, graphics text layout, and plugin architecture, is the engine’s responsibility.

React Native VS Flutter Technical Architecture
React Native VS Flutter Technical Architecture Comparison

Analysis & Results

There isn’t always a requirement for a bridge when using the Flutter engine since most of the native components are already in the framework. However, React Native communicates with native modules through the JavaScript bridge, resulting in subpar performance. As a result, Flutter emerged victorious in the contest against React Native. So far, it’s a tie between React Native VS Flutter.

Score: React Native 1 — Flutter 1

React Native VS Flutter Installation

Developers who are just getting started should quickly understand the installation process, and it shouldn’t have too many stages.

React Native — NPM

To get started with the React Native framework, download and run the node package manager (NPM). Installing React Native is simple for JavaScript developers. Nevertheless, other developers will have to learn how to use the node package manager. You can install the packages locally or globally using the node package manager. The developers will need to know the precise location of the binary. We’ll also need the package manager on macOS when installing React Native.

Flutter — Binary download 

To get started with Flutter, go to the Flutter website or Github and download the binaries for your platform of choice. On macOS, we must download the Flutter.zip file and add it to the PATH variable. To save users from having to go through these additional steps during installation, Flutter should support package managers such as Homebrew, MacPorts, YUM, APT, and so on. 

Analysis & Results

Neither Flutter nor React Native have a native package management one-liner installation for a specific OS. However, it seems that installing Flutter entails additional steps. Installing React Native doesn’t need downloading the binary; package managers may take care of it for you.  

Score: React Native 2 — Flutter 1

React Native VS Flutter Setup and Project Configuration

It takes time to set up the new framework on the developer’s machine. Configuration of software installations is necessary for droves to accomplish this task. To get people up and running quickly, the technology should come with thorough instructions and documentation.

React Native

The React Native project’s getting started guide assumes that the developer already has all of the necessary setups for iOS and Android creation. There isn’t much information about the Xcode command-line tools, but it won’t be enough to get you started. The manual goes right to the stage of creating a new project.

Flutter

For iOS and Android, the Flutter Getting Started Guide includes comprehensive instructions on setting up the IDE and platforms. Flutter install on macOS has all the info you need. The flutter doctor command-line tool is included with the framework and walks developers through the setup process to make things even easier. It examines the local system to see which tools are already installed and which ones need to be set up. We can proceed with building a new Flutter app if the flutter doctor command is happy.

Analysis & Results

The comparison between React Native VS Flutter shows that Flutter has superior documentation and CLI tools for setup and configuration. Thus, it’s obvious which one to choose in this case.

Score: React Native 2 — Flutter 2

UI Components and Development API

Support for native components is critical when developing cross-platform mobile applications. Our app won’t feel like a native one if it doesn’t have native component support. An API is necessary for the framework to access the native components easily.

React Native — Fewer components

UI rendering and device access APIs are the only features provided by the basic React Native framework. React Native relies on third-party libraries to access most native modules. Too many third-party libraries are necessary for React Native to work properly. There is a comprehensive collection of development tools and official APIs available.

Flutter — Rich in components

In addition to UI rendering components, the Flutter framework comes with many libraries and API access. Because of this comprehensive collection of components, third-party libraries are no longer necessary. You’ll get everything you need to build mobile applications if you get the Flutter framework. The Material Design and Cupertino features in Flutter simplify developers to design an app’s user interface for iOS and Android.

Analysis & Results

While React Native relies heavily on third-party libraries, Flutter has robust developer APIs and UI components. As a result, in the debate between React Native VS Flutter, Flutter emerges victorious once again.

Score: React Native 2 — Flutter 3

React Native VS Flutter: Developer Productivity

The ability to create applications more quickly relies on developer productivity. As a result, it’s critical to keep your focus only on app development at all times.

React Native

If a developer is proficient in JavaScript, creating cross-platform apps will be a breeze. The hot reload functionality in React Native saves developers a lot of time when testing UI changes. Developers may use whatever text editor or IDE they choose as far as IDE support is concerned.

Flutter

Flutter also includes a hot reload function, and the sample app is incredibly simple to use. However, as applications get more complicated, developers will become familiar with and implement the new Flutter ideas. Additionally, Dart is not a widely-used programming language, and many integrated development environments (IDEs) and text editors lack support for it.

Analysis & Results

React Native, being a mature framework, offers excellent developer support in Integrated Development Environments (IDEs) and language capabilities. As the Flutter community develops, so will Flutter’s popularity, which is still relatively young. And this levels the scores between React Native VS Flutter.

Score: React Native 3 — Flutter 3

React Native VS Flutter: Community Support

Developers create a community to exchange knowledge when they show an interest in new technology and incorporate it into their development process. Developers benefit from a robust community when they can learn from one another and work through issues they are experiencing.

React Native

When React Native was first released in 2015, it quickly garnered traction among developers. There is a global React Native developer community with many meetings and conferences. One of the most prominent React Native conferences took place in Poland, and there are meetings in nearly every major city across the globe.

Flutter

Flutter has been around for a while, but Google’s promotion during the 2017 Google I/O conference brought it to greater recognition. Flutter’s user base continues to expand at a fast pace. Online get-togethers and conferences are becoming more common. In 2018, Google announced the release of Flutter 1.0, which was the most significant to date. While the Flutter community is expanding quickly, there aren’t enough tools available for developers to address the most pressing problems they’re encountering.

Comparing the most common communication routes for each tool is important, so we’ve included some additional information:

React Native VS Flutter Community Statistics
React Native and Flutter Community Figures

Analysis & Results 

Since the introduction of the framework, the React Native community and its resources have expanded significantly. Flutter is a newer framework as compared to React Native, yet it has a burgeoning community. All in all, React Native gets the nod here.

Score: React Native 4 — Flutter 3

React Native VS Flutter Testing support

An excellent approach to receiving immediate feedback on your code is to write tests for it. Every mature technology has a testing framework that enables developers to create unit, integration, and user interface tests.

React Native

A few unit-level testing frameworks in JavaScript are available for React Native, which is a JavaScript framework. Snapshot testing is possible using these technologies. However, React Native does not provide proper support for integration or UI-level testing. Official support for third-party testing tools for React Native is not available.

Flutter

Testing applications at the unit, widget, and integration levels is a snap with Flutter’s robust collection of testing tools. Flutter’s testing documentation is excellent. Flutter offers a fantastic feature that allows us to build UI widget tests and run them at the pace of unit tests to verify that they work as expected.

Analysis & Results 

In contrast, to React Native, the Flutter community offers excellent documentation and a robust set of testing tools. As a result, React Native loses ground to Flutter in the debate.

Score: React Native 4 — Flutter 4

Build and Release Automation Support

The process of releasing a mobile app to the App Store or Google Play Store is difficult. It entails the challenging job of digitally signing every other piece of software. Cross-platform mobile app development, on the other hand, becomes much more difficult.

React Native

There are no automated procedures for deploying iOS applications to the App Store in the official React Native instructions. However, it allows you to deploy the app directly from Xcode. In the meantime, we can utilize technologies like Fastlane to deploy React Native-written iOS and Android applications. All in all, React Native must depend on third-party libraries to automate development and release processes.

Flutter

Using Flutter’s command-line interface is a snap. Using the command line tools and the instructions in the Flutter manual for building and publishing applications, we can generate a binary of the app. Additionally, Flutter has detailed the deployment procedure officially using Fastlane.

Analysis & Results

To deploy applications from the command line, you may utilize Flutter’s powerful build automation tools. The official build automation CLI tools are not supported in React Native applications. So, in the battle of React Native VS Flutter, Flutter emerged victoriously.

Score: React Native 4 — Flutter 5

Let’s take a look at some of the most popular applications created using each framework.

Popular Apps Developed Using React Native and Flutter
Popular Apps Developed Using React Native and Flutter

Flutter and React Native have some big names on their sides when comparing them.

So, when considering final scores (React Native 4 VS Flutter 5,) Flutter emerged victorious in this contest even though the race was very tight. Although React Native gave it their all, Flutter came out on top in today’s competition.

Final Thoughts from Treinetic

Flutter is attracting an increasing number of businesses. The Flutter SDK is becoming better every month as Google works to make it even better. In addition, the people in the community are kind and supportive at all times. As a bonus, we can build mobile apps and web and desktop apps using Flutter (the desktop support for Flutter is in beta on the stable channel).

When everything is said and done, the future of Flutter seems bright, especially because major corporations like Alibaba are already utilizing it. As for React Native, Facebook is presently re-architecting the technology on a big scale. We can assist you if you plan on creating mobile (or web) applications for several platforms at the same time. When it comes to framework compatibility, Treinetic is adept at both Flutter as well as React Native. If you’re interested in such a partnership, please let us know, and we’ll get in touch with you to work out the specifics.

What Is IT Staff Augmentation

What Is IT Staff Augmentation, and What are the Benefits?

What is IT staff augmentation, what is the procedure, and what are the benefits of this? If you have any of these or similar questions, you’ve found the perfect place. You can learn about IT staff augmentation and how it works in this in-depth post. We’ll also go over the benefits of using IT staff augmentation services.

As communication and IT technology develop in the twenty-first century, employing workers from inside the company is no longer the ideal choice. As a result of globalization and technology advancements, it is now viable to quickly and safely establish distant global teams.

Particularly in the field of information technology and software development, this is true. It is estimated that worldwide technology expenditure will reach $5 trillion in 2021, according to CompTIA. Technology-related firms also rely less on traditional in-house development teams and augment their IT personnel instead with alternative sources.

What Is IT Staff Augmentation?

IT staff augmentation is an outsourcing technique involving hiring external, highly qualified technical personnel to temporarily or permanently fill vacancies in your organization’s workforce. It gives companies the freedom to pick and select the employees who best meet their needs and trim or expand their augmented teams as necessary. Staff augmentation is something that a large number of businesses provide. You may increase your in-house development team’s technical resources on a temporary or permanent basis by working with IT staff augmentation providers.

The addition of IT personnel is a component of the overall expansion of the workforce. Staff augmentation is a contractual outsourcing service provided by an external supplier to supplement the in-house team’s expertise and abilities. This approach involves assessing current staff competencies and identifying the talents that are lacking.

The vendor makes use of these resources directly. Therefore, hiring additional full-time employees and the associated costs and liabilities are no longer necessary. As a result, remote developers employed by a staff augmentation firm work on a single project exclusively.

When Is IT Staff Augmentation Appropriate to Your Company?

This approach of staffing is feasible if:

To begin, if you already have a team in place but wish to grow it.

The staff augmentation approach has the wonderful advantage of reducing costs. When you need to expand your software engineering staff or create a new department, consider outsourcing. Providing office space, insurance, and other benefits are not required, nor are high wages. Many of these issues are addressed by the staff augmentation approach.

In the second place, if you need specialists that possess a certain set of technical skills

There are many award-winning software development firms throughout the globe. Can you even fathom the size of the global talent pool? You’ll be able to locate a developer that specializes in a certain area of technology.

Third, you need some degree of flexibility

If you employ an in-house team, you can’t just hire an engineer for the day, but if you use a staff augmentation model, you can simply switch out team members as the project changes.

Fourth, there aren’t any competent developers in your region

It’s possible that you’d want to hire more people but don’t have the resources to do so. Hiring engineers that are fluent in a particular programming language, on the other hand, may be difficult. Finding an outsourcing or software team augmentation firm to cover the necessary skill gap is ideal if it’s about you.

Comparing IT Staff Augmentation with Other Known Models

Staff Augmentation

The staff augmentation approach gives you complete control over the hiring process, selecting the applicants you want to work with. The vendor handles all of the organizational and administrative headaches. At the same time, you’ll be able to focus on your primary duties while working with your augmented team in the same manner that you would with your in-house engineers.

Own R&D Center

Let’s say you want to expand your company’s workforce by at least 40 people. Alternatively, you may want to consider locating your R&D center in a nation with an improved business climate and a larger pool of IT expertise. It implies that you’ll have to study the legal system and the country’s culture and take all the risks yourself.

Managed Services

From organizing a team of developers to overseeing every procedure on their own, the project outsourcing firm takes care of everything during the development of your project. You don’t have to spend time on your remote development staff or have in-house tech knowledge.

Staff Augmentation vs Other Models
IT Staff Augmentation and Other Models Comparison

IT Staff Augmentation Process Flow

Step 1: Determine where there are skill shortages

You’re all set with project details. You have a clear vision of how your project will work. You’ll have to find out where your strengths and weaknesses lie now. If you don’t know what kind of specialist you need, don’t worry about it. Plan a meeting with the vendor you’d want to collaborate with and explain your needs to them. They and the appropriate software developers will recommend your technology stack along with your project.

Step 2: Orientation and integration into the workplace

Integrate your new team members into your business after negotiating terms and conditions, signing contracts and NDAs. Investopedia describes an NDA as a legally enforceable contract that creates a confidential connection between two parties. And that’s crucial, so don’t forget about it. Set up meetings with your existing teams, provide any training that’s required, and allow them to get acquainted with technical terms before letting them loose in the office.

Step 3. Managing the Process

The final stage will continue for as long as you work with a larger group. As the saying goes, “Live and learn.” To keep your team motivated and show you if your efforts are justified to keep learning and analyzing the value your new team contributes to the project. Be sure to keep in mind the people in charge and the responsibilities that have been established from the start.

IT Staff Augmentation Process Flow and Candidate Selection
IT Staff Augmentation Process Flow

What Are the Benefits of IT Staff Augmentation?

High Productivity Level

Project outsourcing teams may handle several projects at the same time, but using a staff augmentation team keeps developers focused on a single one at all times, allowing them to be more productive. Being motivated and dedicated to one client’s huge goal is a great feeling.

IP Rights Security

All intellectual property rights (IP) belong to you from the beginning of the collaboration with your devoted developers.

Flexibility

Flexibility increases on two grounds:

1. From UI/UX designers and front-end developers to Scrum masters and product owners, you’ll have easy access to a diverse group of IT experts with whom you may collaborate.

2. The skill pool is larger. Therefore, it’s much simpler to find a replacement for a developer. Working with a staff augmentation company means you save money on the transition.

Savings Potential

An exceptionally clear pricing structure characterizes staff augmentation services like these. You will not be responsible for administrative and organizational costs such as office space, workstations, or other facilities. You just pay the price, and the vendor handles the rest, allowing you to concentrate on your core business operations.

Benefits of IT Staff Augmentation
IT Staff Augmentation Comes with Several Benefits

How to Grow Your Business with IT Staff Augmentation?

Opt for a provider that will set up dedicated team rooms for your remote devs, complete with everything they’ll need. For example, at Treinetic, our teams have rooms with the client’s corporate logo to make it easier for the offshore team to integrate with the in-house engineers.

To ensure that your remote developers feel a part of the local team, make sure they know it. Ask the vendor if they have experts that can assist you in working more effectively with your team. HR/client managers work side-by-side with your developers at Treinetic to assist in clearing up any misconceptions that may arise throughout your collaboration.

What’s Your Next Step?

Using a technology staff augmentation approach saves time, gives you greater control over your process, and lowers costs.Starting your search for an outsourcing provider now is the best thing you can do if the scenarios outlined in this article match your present position. If you’d want Treinetic to assist you in this process and find your unique skills, please get in touch with us now!

Staff Augmentation vs. Project Outsourcing

Staff Augmentation Vs. Project Outsourcing | What to Choose?

Some elements of an organization’s IT requirements, such as system monitoring, data backup, and network administration, are nearly steady. However, new or unanticipated IT initiatives may bring a large amount of labor at once. It’s at this stage that many businesses start debating between staff augmentation vs project outsourcing.

On the other hand, the worldwide IT sector is expected to be worth about $5 trillion in 2021. Asia will also significantly impact the global IT sector, with a share of 32%. And these Statista figures demonstrate just how big the IT sector has become in the modern world. It’s safe to state that IT outsourcing is a lifesaver thanks to its many advantages before going into further detail. Therefore, an increasing number of businesses are delegating their IT duties to third parties. Now, let’s compare project outsourcing with staff augmentation in detail.

Staff Augmentation VS Project Outsourcing

What is Staff Augmentation?

In staff augmentation, a software firm hires external engineers on a Time & Materials contract basis to supplement its own engineers’ skills. Third-party experts who work exclusively on the buyer’s premises for the duration of the project extend the outsourcer’s internal team in practice (or serve as its only members).

Companies save money on recruiting, payroll services, and project execution by using staff augmentation. This model can be readily scaled up or down because it’s a partnership rather than an employment contract. As such, FTEs may be decreased (or increased) promptly as required. Furthermore, this complete shift of responsibility reduces administrative burdens associated with HR and employment. As a result, the outsourcer can devote more time and resources to the core business.

Benefits of Staff Augmentation
Staff Augmentation Can be Beneficial for Some IT Companies

What Is Project Outsourcing?

By collaborating with a remote software company and handing over the project to its team of programmers, you can outsource a dedicated team. Most of the time, it involves much more than simply team augmentation in a collaboration. Software-related services like design and analysis are also included. These include UI/UX design and quality assurance as well.

Due to the vendor’s deep engagement, there is a greater incentive to produce the best possible outcomes than staff augmentation. As a result of all of this, the software company is more than simply a temporary service provider. It is a close and valued partner.

Benefits of Project Outsourcing
Project Outsourcing Comes with Several Benefits for IT Companies

Staff Augmentation VS Project Outsourcing: A Detailed Comparison

Let’s look at a short comparison of the pros and cons of staff augmentation vs project outsourcing to find the answers.

1. Project Management

The outsourcer typically manages the project internally under the staff augmentation model, even though external employees are responsible for certain aspects.

Employing a dedicated team, on the other hand, implies hiring a project manager. And this reduces the buyer’s project management duties while the vendor assumes complete project management responsibility. For the buyer’s convenience, a single point of contact is usually established.

The software provider’s governance system is another advantage of external project management. An experienced software house has already figured out the most effective method of managing IT projects, has a lot of such collaborations in its portfolio, and understands how to get things done on time and within budget.

2. Responsibilities and Cost

Both approaches place the onus on the service provider to find and hire qualified engineers. With dedicated teams, however, the vendor pays for office space, software licensing, gear, utilities, and the training of the staff. Moreover, they take care of the general well-being of software engineers.

What’s on the surface in terms of employment expenditures is only the beginning. The software house is responsible for any costs that go into calculating the total cost of ownership for these types of tasks. Although this endeavor increases employee engagement and reduces attrition, it must be correctly done to be effective.

Project outsourcing has the apparent advantage of lowering costs. According to a Statistics Brain study, 44% of American firms surveyed chose the project outsourcing approach primarily to save costs. Ultimately, the outsourcer benefits from having a motivated and competent workforce because of all of this.

3. Relationship with the Vendor

Without mutual trust and understanding, no business partnership will be successful.

Companies often form more direct and long-term relationships with developers they outsource. When you and your partner work closely together, you better understand your company’s fundamental requirements and problems. Frustration and discomfort are all too often in the workplace when people lack confidence in the people they’re working with.

A relationship with a provider of staff augmentation services is more limited. Also, it essentially boils down to merely delivering resources in the form of a required number of engineers. It is not uncommon for this kind of business connection to end with the last line of code. Thus, it is superficial. Last but not least, the staff augmentation services supplier often shows less concern for your IT project’s eventual success than the other parties involved.

4. Cooperation Kick-Off

Staff augmentation providers often need less time to get up and running than a committed team of programmers.

However, the outsourcer bears some of the burden of identifying the best fit. Buyers should be wary of making assumptions about candidate profiles, abilities, and technical experience required for the project without an expert on their own staff or one on the supplier’s side. The kick-off may take longer and cost more if it doesn’t have this.

When it comes to gathering a dedicated team for each project, the software house has the sole duty of scaling it to meet the customer’s current requirements and guarantee seamless development management. The outsourcer’s job is to determine the project’s scope and functionality rather than to express personal preferences for certain programmers or developers in general.

5. Working and Organizational Culture

Working and organizational culture vary greatly between the two types as well.

Developers in an outsourced team may establish a unique knowledge exchange and collaboration atmosphere by working together in the same office. The staff augmentation approach is typically outclassed when it comes to close friendships, the general environment, and team spirit.

In addition, the software firm ensures that its employees are comfortable at work. Moreover, they get appropriate career development and mentorship and have access to all essential resources. Well, that’s not all. They also ensure that the company’s culture is strengthened.

Engineers in the staff augmentation model may not identify with either party since they know they will be working on another project for a different company sooner or later. And this common cause of demotivation can trigger changes in jobs.

6. Internal Policy

Working with outside contractors also often leads to a shortage (or severe scarcity) of in-house programmers. When you hire engineers solely for the project, you may get caught in a loop because you can’t use the same engineers you used for staff augmentation after the project is over. This means you have to find other developers, introduce them to the company, share domain knowledge, and so on – just to let them go after the project is over. The cycle repeats itself.

7. Insights and Knowledge

Temporary workers also have the drawback of not knowing your company, your previous projects or products, your previous business experience, or your market expertise. This means you can’t count on them to be as proactive or creative as a normal employee.

An additional benefit of using a dedicated outsourced team is that the connection is more personal, allowing the team to know your company better and better understand what you need. This is not the case with staff augmentation.

You can expect innovative software solutions from your business’s software partner.

Staff Augmentation vs Project Outsourcing
Project Outsourcing Lets You Focus on Your Core Business More Than Staff Augmentation

Treinetic’s Reasons for Believing in Outsourcing

Staff augmentation has certain obvious advantages. It’s a good approach to coping with IT talent scarcity when your company wants quick results with a tight budget but doesn’t have much time to spare. The advantages of adding personnel, on the other hand, diminish in direct proportion to the project’s duration. Working with a remote software house will be more effective and advantageous as the IT project grows in size and complexity. 

Companies that specialize in trustworthy, robust, and skilled in managing IT projects stand augmentation are available, as is the case with any other service. And, in some cases, this model may be just what you’re looking for. However, the long-term advantages of a successful IT collaboration are more cost-effective and less stressful for the project, according to our experience. We also must study what big companies prefer in this case. According to Love to Know, even IBM and Dell outsource. And this suggests the effectiveness and pros of outsourcing. 

You can concentrate on your company’s core and get cutting-edge outcomes by letting a dedicated, award-winning development team handle your software solution’s design, development, implementation, and maintenance.