Offshore team vs freelance portals both are great options for building your remote teams. But which to choose for your business? Read the blog to understand how offshore teams differ from freelancer portals, their advantages and disadvantages, and scenarios where they work the best.
The volatile market and the constant upturn in economies have made one thing sure. Companies need agile, resilient, and flexible teams to navigate the challenges of the new world. IT outsourcing is no longer an option but has become part of business strategy, and remote teams are considered one of the most viable solutions to counter the constantly evolving technology landscape.
Remote teams are great!
But as a business, you must constantly need clarification about how to build one and whether to choose offshore teams or hire from bidding portals.
Well, you are in luck, as this blog will help you clear up confusion and make an informed decision while creating your remote team.
- Both offshore teams and freelance portals are good options for scaling your operations. But their viability depends on factors like project scope, budget, resource requirement, and length of engagement.
- Hiring from freelance portals is profitable when you need resources at low prices to work on small tasks.
- Choosing an offshore team becomes more suitable when you seek to build complex projects that require large teams and bigger budgets.
Let us dig into offshore team vs freelance portals, what they are, how they differ, and what to choose for your upcoming software development project.
Quick Comparison For Hiring From Offshore Team Vs Freelance Portal
|Factors||Freelance Portals||Offshore Team|
|Budget||Small budget (less than 3000 USD)||Medium to large budget ( more than 3000 USD)|
|Project Size||Small & individual Tasks||Medium to large-size projects with a relatively complex execution.|
|Team Size||Individual hiring||It could range from 2-200 depending on the project size.|
|Data security||Limited||Extensive security across systems, servers, and complete IT architecture.|
|Initiation Time||Immediate||It could take 2-4 weeks|
|Accountability||It is limited to the individual’s work.||The team takes complete accountability for the project.|
|Best Suited||Graphic design, website design, or building single functionality of an app.||Designing & developing complete web & mobile applications.|
Hiring From Freelance Portals
Freelance portals or bidding platforms are online talent aggregators where one can hire freelance resources to build remote teams. These global talent marketplaces act as intermediaries, assisting you in finding, hiring, and collaborating with freelancers on various projects.
In bidding platforms, freelancers create profiles showcasing their skills, experience, and work portfolio that help them connect with businesses seeking their services. These portals have customer ratings and review sections integrated with each profile, providing companies with transparency in the quality of work delivered by a resource in the past.
Some popular freelance portals are Upwork, Freelancer, Fiverr, and Guru. You can post your project requirement on the portal for resources to contact you or use their search engine with relevant keywords to find the right resources to work on your projects.
Benefits Of Hiring From Freelance Portals
Freelance portals are a great way to find talented freelancers to ramp up your development project quickly. Here is a list of benefits you get when you hire from bidding platforms.
1. Access To a Large Global Pool of Freelancers
Freelance portals are global talent aggregators. They connect businesses to a vast pool of readily available talent from all over the world. So they are a one-stop-shop for hiring freelancers with diverse skills and expertise.
One of the biggest advantages of bidding portals is that their talent pool is not limited to software engineers. From design and development to marketing, you can easily find freelancers to support your business requirements.
2. Quick Support & Flexibility
Freelance portals enable businesses to hire developers to support their ongoing development quickly. A company can engage freelancers on a project-to-project basis and enjoy the flexibility to scale their operations as needed without any long-term commitment.
3. Competitive Pricing
When compared to their counterparts, freelance portals offer resources at a much lower cost. Besides being economical, you also get full transparency in the cost as every freelancer enlisted on the portal shares their rate card based on the services they provide. You can find competitive rates by comparing different freelancers' proposals or bids to select the one that fits your requirements.
4. Transparent Hiring Process
The rating and reviews on freelance portals help you streamline the hiring process. You can compare the work portfolio, ratings, and reviews on the freelancer profile before initiating any discussion with the individual. This helps you save the time and energy you would have spent on traditional recruitment.
Though freelance portals are a great way to scale your dedicated development teams quickly, they have various disadvantages.
Recommended Read: Strategies to Develop a Successful Relationship with Your Offshore Team
Challenges Of Hiring From Freelance Portals
Here are some of the more common challenges businesses face when they hire talent from bidding portals.
1. Lack of Transparency in Hiring
Though freelance portals provide transparency in pricing the resources enlisted on the platform, it does not guarantee that the same resources work on your project. Many times freelancers have their agencies and teams of junior resources who carry out the execution.
Since these are inexperienced resources, the quality of work delivered is inconsistent and of poor quality. You may find yourself stuck in a vicious loop of constant correction & feedback, leading to delayed deliveries and poor-quality work.
2. Finding The Right Resource
A freelance portal is a one-stop shop to access the global talent pool of freelancers, which is awesome!
But it also implies that you must go through thousands of freelancers’ profiles before you find ‘The One.’ Simply put, finding the right candidate on a freelancer portal can be compared to finding a needle in a haystack.
Not only are you required to have in-depth technical expertise in your project, but you must understand the nuances of different markets to make a fair comparison between resources.
So, the ‘quick support’ can quickly become a hiring nightmare for the selection team, wasting their time, efforts, and finances.
3. Unsuitable For Hiring Teams
The bidding platform provides you access to talented freelancers you can hire to support a particular project development function. Managing and coordinating with one or two freelancers may not seem difficult. But managing an entire team of freelancers can overwhelm the most experienced project managers.
Firstly freelancers work on their schedule, so coordinating and getting them aligned to work together can become a major challenge.
Secondly, freelancers take accountability for only their work. They rarely extend help to coordinate work with other freelancers. The lack of initiative on their behalf creates communication gaps and unnecessary delays.
Lastly, challenges like ego clashes could result in friction between team members.
4. Handling Multiple Projects Simultaneously
Freelancers are usually involved in more than one project at any given point in time. It means your project does not get undivided and dedicated attention, resulting in delivery errors and longer development cycles. It also compromises information security and increases the chances of data breaches.
5. Compromised Data Protection
Freelancers work on their personal systems. Though it would be wrong to say that their work setup is insecure as they have a basic security setup, they still do not possess the infrastructure to support the safety of an enterprise-level project.
Also, when you hire a team of freelancers, the information is exchanged on multiple systems and servers, making your data more vulnerable to malware, theft, and cyber attacks.
6. No Post-development Support
When you hire talent from a freelance portal, you hire them on a project-to-project basis. It means the freelancers take up new assignments from other clients once the project is delivered.
So, if in the future you face a challenge with the product they delivered, they are rarely available to assist. Even when they are available, they will charge you extra for the new work you have assigned to them.
7. Finding Experts Is A Challenge
Though bidding portals offer a large talent base for hiring freelance resources, one often faces challenges when hiring high-quality experts with extensive experience. Besides a shortage of experts on these platforms, the available ones are often too expensive to hire.
Though hiring from bidding platforms has its drawbacks, there are many scenarios where freelance portals become a very viable option for businesses.
When To Choose Freelance Portal for Hiring Talent
Freelance portals become practical choices for businesses in the below circumstances.
1. Short-term Engagement
Hiring a freelancer becomes a more suitable option if you are looking to hire a resource to support your ongoing development for a short period, like for 2-3 weeks.
2. Small & Independent Tasks
Hiring freelancers from a bidding platform is great when you need the talent to help you work on functions that are small in terms of hours of engagement and have zero to low dependency on other roles. Consider hiring freelancers for graphic work, website design, and small development work like building a particular widget or specific functionality.
3. Budget Constraints
When operating on a very low budget, choosing freelancers is the way to go. Hiring freelancers is more practical than building your team if your average project budget is below 3000 $USD.
Hiring Offshore Team
As the name suggests, an offshore team is a team of skilled software engineers hired from an offshore destination/country to augment your IT team or scale your development project.
You can build your offshore team by hiring resources from offshore software development companies in countries like India, Ukraine, Argentina, etc., that offer highly skilled software developers at a much lower cost when compared to the US, UK, Canada & western European countries.
You can hire offshore developers/teams to handle various functions, from building new products/solutions, scaling development, and quality assurance to software management and upgrade.
Benefits Of Hiring An Offshore Team
Working with an offshore team benefits your business greatly. Here are some of the biggest advantages.
One of the most significant advantages of working with an offshore team is the cost-saving business experience. A study shows that businesses can save as much as 60% of their project costs when they work with an offshore development team.
Here is how an offshore team helps you save costs:
- Cheaper resources: One hires Offshore teams from countries that offer highly skilled resources at costs. So you can hire talented software engineers at as low as ⅓ of the cost of hiring in-house resources.
- No hiring cost: You hire Offshore teams from offshore development companies with a large talent pool of pre-vetted programmers and coders across technologies. They can quickly align resources to work on your project, saving you the time, effort, and money required in hiring in-house resources.
- Zero infrastructure costs- Your partner offshore development company provides the infrastructure and equipment to the hired team. So you save on infrastructure costs to support the offshore team.
2. Quick & Hassle-free Scaling Of The Team
Since your offshore development partners already have a pre-existing talent pool of skilled and talented software developers, scaling your offshore team horizontally or vertically becomes quick, easy, and hassle-free. All you need to do is share your requirements with your offshore partners, and they will align the interview with the relevant talent to speed up the hiring.
3. Complete Transparency & Team Ownership
When you hire an offshore team, you get who you choose during the hiring process. The resources aligned with your project are the same as the ones you selected, and they work dedicatedly on your project. These resources operate under your supervision, reporting their day-to-day functions directly to you.
Also, since an offshore team works as an extension/subsidiary for your business, you get full authority to define and train them on your organization's workflows, hierarchy, and processes to ensure seamless execution.
4. Data Security & IP Protection
Offshore development companies are well-established organizations that have invested in building highly secure infrastructure and security protocols to safeguard customer data. So, when you hire an offshore team, you can be sure that your data is never compromised.
Besides this, the extensive NDAs signed by the offshore partner and the hired resources ensure that your product IP and source code is always protected.
5. Quick Resource Replacement & Backup
So you have hired an offshore team to work on your project but realize that some resources don't align well with your requirements. What then?
Well, in such a scenario, your offshore partner has your back. They set up interviews with relevant developers to help you quickly replace these resources. They also help you create backups for hired offshore team members, so you have a readily available team to handle any development emergency or resource crunch.
6. Extensive Tech Support
One of the most underrated benefits of working with an offshore team is the comprehensive tech support from experts and senior management. Every offshore team has a tech lead and project manager.
So whenever one faces a challenge in execution, they can talk to their tech lead for support. If the problem is more complex, the team can contact senior architects or the CTO for assistance.
Such a comprehensive workflow hierarchy and escalation matrix ensure no roadblocks in the development process, ensuring on-time delivery or high-quality work.
7. Long-term Collaboration & Team Integration
Offshore teams are a choice when you seek long-term engagement with the hired resources. They act as an excellent subsidiary to your business, providing you right tech support whenever required. Since the teams work directly under your supervision, they align better with your company's culture and work methodology.
8. Post-development Support
Your relationship with your offshore team continues after project completion. Your offshore team is always available to help us overcome any future challenges, even after the completion of the project.
Challenges of Hiring An Offshore Team
Choosing the right offshore partner to hire resources is paramount when hiring an offshore team. Or you may have to face the following challenges.
1. Communication Barrier
A communication barrier can arise from two factors- a) Language and b) Analytical skills.
Poor language skills can lead to misunderstanding briefs, delayed responses, and wrong execution. Your offshore team must have a good command of English to ensure smooth operations.
Like language, having the right analytical skills is crucial to a project. A team's analytical skills define its ability to understand and execute a project. If your offshore team lacks the necessary analytical skills, it's worth taking the time to consider the skills and abilities of your team members.
2. Cultural Barrier
When working with an offshore team, it is essential to understand that you are not only working in different time zones but are dealing with individuals from different cultures.
Cultural differences can cause misalignment between in-house and offshore teams if both parties must be informed and educated about their differences and how to address them.
Setting proper communication channels and SOPs to avoid misunderstandings while working is always advisable. A better approach is to choose offshore teams with experience working for similar markets and industries to make the transition easier.
3. Legal & Security Concerns
Data protection is a business's biggest concern when working with an offshore development team. Before selecting a team, examining the security measures your offshore partner has deployed to protect your data is essential.
- Do they have enterprise-grade security?
- Do they follow proper safety measures and security protocols?
- Do they have appropriate infrastructure and end-to-end system security?
Getting answers to these questions can help you gauge the seriousness of your partners regarding data security.
Besides this, you must consider the geo-political stability and legal environment of the country you're looking to work with. It will help you understand the level of support you can expect from the legal system in case of a data breach and ensure your project is safe and secure. Considering all these factors will help set your project up for success and avoid pitfalls.
When To An Hire Offshore Team
Hiring offshore teams is a great way to build an agile, flexible, future-ready business. Offshore teams bring diversity to your work environment, making your business more adaptable to the constantly evolving world of technology.
Here are some of the scenarios where offshore teams become a perfect fit.
1. Long-term Engagement
If you want to hire developers and programmers for a long-term project, offshore teams are the right choice. These experts work dedicatedly on your projects and have a deep understanding of your business systems, processes, and products.
2. Large Projects
Offshore teams become a more viable option for building large projects as large projects require large resources across different hierarchies to manage complex execution. The team members have to work in sync with each other to ensure quality in development.
So, hiring resources from an offshore partner becomes a more practical choice when developing a large and complex project.
3. Global Expansion
Offshore teams are a great way to build a strong global presence. They help you mitigate the challenges of entering a new market by helping you build a reliable offshore team of experts. Your offshore partner understands the complexity of the local geography.
Your diversified offshore teams share real insights into their market, helping you create more resilient products and solutions.
4. Specialized Experts
If you seek highly specialized and experienced experts in emerging technologies to work on your projects, offshoring is the answer you seek. Offshore development companies provide:
- A vast pool of pre-screened resources.
- Enabling you to quickly employ top-tier specialists and deliver high-quality products in record time.
- Reducing your time-to-market significantly.
To sum it up, there is no one answer to the question ‘offshore team vs freelance portals, which is the right choice?’ The right choice will depend on factors such as project complexity, team requirement, available budget, the timeline for delivery, etc.
The freelance portals allow hiring resources quickly at a low budget to kickstart your project. Still, offshore teams offer more reliable setups regarding accountability, security, and post-development support.
So, one must weigh both options' pros and cons before deciding, and we hope this blog will help you a step closer to making an informed decision.
Frequently Asked Questions (FAQs)
What is an offshore team?
What are freelance portals?
How do I decide between an offshore team and using freelance portals?
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