DO you have a software development project and wonder which is the best model to build it?

There are several viable options, so the best way to make the best decision is to 1) assess your business needs and resources and 2) research each business model.

In this article, we address three business models: team leasing, outsourcing, and in-house teaming. Specifically, what they represent, their pros and cons, and which to choose.

What is team leasing?

Team leasing is a business model that consists of “borrowing” a team of specialists from a software company to work on your project. According to this model, you – or an assigned team leader – manage the whole project. This means your company is responsible for planning, delegating, and coordinating every task and operation.

Pros

Fastest hiring option: you do not have to go through job advertisements, interviews, and selection processes. You can get an experienced team dedicated to your project almost immediately.

Cost-effective: an in-house development team requires a financial commitment, and not every company is willing or capable of making it.

Flexible model: you can hire the experts you need when you need them, no strings attached.

Cons

Indifference towards the company: hired professionals from a lease vendor do not have any commitment or interest in your brand. They know they were hired for one project only, which can take its toll on motivation and loyalty.

No return: you will train employees that will not stay with your company

What is outsourcing?

Outsourcing is very similar to the team leasing model. The biggest difference is that when you choose the outsourcing business model, you hire custom software developers to be in charge of the project.

Pros

Cost-effective: much like leasing a team, it is a cheaper option, compared to in-house development.

Scalability: it is easier to upgrade or downgrade your development team when you choose to outsource.

Quality software development service: outsourcing gives you access to some of the world’s best developers. This is why it is common for companies to choose this business model for denser, more complex projects, such as bespoke software development.

Cons

Logistical issues: timezones and communication barriers are inherent challenges to this business model. They can affect the speed of the project development and even the quality of the final product.

Time-consuming in the beginning: choosing the right outsourcing company is not something you can do overnight. It requires some research and interviewing, which may delay the start of your project.

What is an in-house team?

Contrary to team leasing and outsourcing, an in-house team is part of your company. It is a team of employees who work at your company only. This means that you need to recruit all sorts of professionals who are indispensable for the development process.

Pros

No communication issues: an in-house team communicates more and better.

Better quality control: with an internal team, you can monitor the development process more closely.

Motivation: an internally hired team is more likely to be loyal to the company and worry about its success.

Cons

More expensive: developing software internally involves many extra costs, such as software, hardware, taxes, salaries and benefits, etc.

Small talent pool: outsourcing companies provide you with all the professionals you need, but with an in-house team, it is not that simple. You might need to provide specialised training at some point, which might delay the project.

Which should you choose?

The answer to this question boils down to what your company needs and the resources it has. So here is a very simple way to decide which business model best suits your project:

Choose team leasing if you:

• Are under severe time pressure
• Need flexible labour
• Are working with a limited budget

Choose to outsource if you:

• Are looking for a cost-effective, high-quality model for software development
• Need scalability
• Want a large talent pool.

Choose in-house development if you:

• Prefer to control your projects entirely
• Have enough resources and infrastructure to maintain an internal team
• Need professionals focused on your software to work on updates and bug fixing.

Final thoughts

You have all the tools you need to give life to your project. Now it is time for you to do your part: study your business and your project. Set your goals clearly. Only then can you make the best decision regarding a business model.