It's common to find outsourcing and outstaffing used interchangeably, but they're not the same thing. Outsourcing is the act of choosing a company or individual to handle specific tasks, while outstaffing is the practice of hiring professionals or contractors within your own organization. As a business owner, it can be essential to understand the differences between these two practices, so you can make the best choice for your business. In general, outstaff vs outsourcing can both serve your needs, but we will show the outstaffing model vs. outsourcing model and see how each one performs.
Before we can make a complete comparison between outstaffing vs. outsourcing, we need to provide a definition of both terms. Outsourcing is the practice of coordinating tasks with a third-party contractor to optimize business processes. Depending on the industry, outsourcing can allow an organization to scale up or down as needed during business cycles and build a flexible workforce optimized for its needs.
By hiring company resources as employees, you can go beyond your in-house IT staff and afford various online resources to help create a fully-fledged digital marketing strategy — remote copywriters and designers, SEO specialists and SEO copywriters, bug testers and software testers, and even brilliant community moderators who are alive during all business hours.
While both terms relate to hiring external resources, there aren't many common things between project outsource vs. outstaff. Let's see the main differences.
Prices are one of the most significant advantages of outstaffing. Since you will only require staff members, you won't have to pay management fees. This is not the case with outsourcing, as this model requires you to pay for the entire process. With outstaffing, you can save a lot of money on management fees, making it a more affordable option for businesses.
Management is another area where outstaffing trumps outsourcing. Since you're the head of the project, you decide what will happen and when. It gives you much higher control than what you'll receive if you outsource. With outsourcing, you're at the mercy of the company you've hired - they may not be as responsive to your needs as you'd like, and they may not be able to make the changes you want in a timely manner. With outstaffing, on the other hand, you have full control over the management of your project and can make changes as needed to ensure its success.
Outstaffing requires you to have a technical background since you need to manage the remote team. This is not the case with outsourcing, where you can leave the partner company to deal with everything. If you're not proficient in the required skills, you might find it hard to manage outstaffed employees.
When it comes to software projects, you may find that outstaffing gives you more responsibility than outsourcing. With outstaffing, you're managing the project, so you're accountable for its success or failure. In outsourcing, your partner is the one who makes the decisions, so they can be held responsible if things go wrong. It all depends on what you prefer and what your goals are for the project. Some people prefer to take the blame but play by their own rules; others want to get rid of guilt.
Since there are many differences, we cannot say, "hey, this model is better than the other," because it's not possible to neglect all their positives. But let's see which are their perfect use cases.
Outsourcing is great if you want to stick to your core operations without bothering about other things. Since you let your partner operate their routine, you depend on them to deliver good results, but it's a good option if you're not experienced in your tech field.
An outstaffing model is a fantastic option for hiring remote workers from abroad. With outstaffing, you can hire only operational staff, which is much cheaper and provides more control over the processes. This staffing method is perfect for companies that depend on their management team and need to fill in gaps in their workforce.