Hiring vs. Outsourcing Engineers. Does it Matter?

CTOs tend to get hung up on outsourcing as a second-class way of building products. “I don’t believe in outsourcing,” is a phrase you’ll hear often. This is likely due to a perception--perhaps rightly formed--that you get what you pay for. Outsourcing may be cheap, but low quality with little control over the final product.

But this perception of outsourcing is changing. The availability of high-performing, long-term, embedded engineers from global markets to work within U.S.-based companies has become a win-win for global engineers and CTOs. Engineers in emerging markets have access to exciting jobs and CTOs get top talent when skilled engineers are hard to find. Long-term engineering staff augmentation firms have emerged to fill this gap, providing recruiting, onboarding, and management of remote engineers and providing payroll and ensuring legal compliance.

Two recent developments have accelerated long-term engineering staff augmentation. First, the H-1B visa ban has made it difficult for U.S. employers to hire foreign workers directly. This has cut off opportunities for engineers and access to talent for businesses. Second, the COVID-19 crisis has made remote work the norm, dimming the distinction between offshore, nearshore, and in-house employees. 

“In a more connected world, businesses and individuals can reap the benefits of U.S. opportunities — top technology stack, access to exciting companies and world-class research — without having to actually live in the country,” TechCrunch said. This gives global engineers “best of both worlds: the comfort of home and ties to an international powerhouse.”

At the same time, “the COVID-19 crisis has made recruitment a remote-dominated sphere, with “traditional modes of hiring are being reassessed, and companies are realizing that teams don’t have to be in an office to be productive,” TechCrunch said. Studies have found that the majority of remote workers are as productive or more productive than when working in an office, delighting managers that were previously skeptical about remote productivity.

Long-term engineering staff augmentation gives CTOs many of the benefits of hiring locally--the ability to interview and select candidates, manage them as full-time employees, and monitor performance--while eliminating the time, cost, overhead, and risk associated with an internal hire. The reality that nearly everyone is now working from home makes the difference between an outsourced hire and an internal hire nearly disappear.

Long-term staff augmentation, to be clear, is different than short-term, project-based outsourcing. The latter is fraught with risk, as it typically involves handing an entire project over to an offshore team, and usually involves a static, low-value project. This type of outsourcing is driven by cost and relies on getting the cheapest available rates. 

Long-term staff augmentation is about finding the right people to join a software team, people with the right skills and experience, and the right attitude, drive, and initiative to enhance teams and cultures. Because the engineers will be onboard for the long-haul, they must augment a product and the team and its culture. Building groundbreaking products is what leading companies need help doing, and it is also what the world’s best engineers are eager to do. The best long-term staff augmentation staffing agencies assess hard and soft skills to match exciting companies with top global engineers, getting the right talent at the right time faster and with less management overhead. 

Increasingly, the difference between hiring and outsourcing is only a matter of who is paying the engineers. The truth is that many of the world’s best developers live outside the U.S. and are looking for opportunities to join great teams and build great products with long-term engagements. With remote teams being the norm, and demand for engineers still high even amid the pandemic, long-term staff augmentation is becoming a go-to method of building and sustaining high-performing software teams.