TL;DR: We analyzed the market, various hiring channels, and payment models. This gave us a pool of 85 developers, 30 QA engineers, 25 DevOps, and 20 other professionals available to join within two months. Our experience has shown you CAN subcontract 100 specialists in a fortnight, but boy, will you have to work for it.
Are you kidding?
The task we were given was challenging, to say the least. We had to find 100+ IT professionals for full-time six-month-long contracts. These people had to be software engineers, QA engineers, and DevOps of different seniority levels (Junior, Middle, Senior) at sensible prices ($15-20, $25-30, and $35-40 per hour).
The task required:
- Selecting companies that work according to the white label form of subcontracting
- Exploring different cooperation and payment models
- Handling other organizational questions
#1 Selecting channels
We decided to focus on cooperating with small (10 to 50 people) and mid-size (50 to 150 people) software development companies. We also considered searching for candidates in professional communities: IT clusters (e.g., Lviv IT Cluster), associations and gatherings of IT company owners, and local channels where companies refer IT professionals to each other.
#2 Shortlisting payment models
Having explored several cooperation and payment models, we saw that the most popular ones were:
- Typical outstaffing. Most companies are open to cooperating under the outstaffing model. It's a classic, clear, and the most comfortable model with fixed monthly payments. The downside? The price might be steep since the vendor takes a fee for handling the hiring arrangements as well as creating a working environment for the employees. It won’t work if the client wants to contract engineers directly.
- So-called, Cost+. This model is similar to renting a football player from another team. The client contracts developers directly and handles all financial and legal arrangements as if they were their in-house employees. On top of that, the client pays an additional fixed fee to the company that has provided the developer. Not all outsourcing companies are ready to cooperate this way since they don't want to share information about developer salaries.
We’ve also encountered more unconventional models, like hiring developers through Upwork, Fiverr, or TopTal. Another way was directly paying developers, who would then personally pay the fee to the company they work for. Models like these prevail among small companies that are just entering the market. On the other hand, they usually offer the most attractive rates.
#3 Other aspects to consider
Depending on the cooperation model established with the company, we had to consider several important aspects.
Outstaffing companies have to be prepared for any attempts of luring employees or even entire teams from them. This is why contracts have to clearly state the conditions of non-solicitation and also transition options if every party involved is willing to proceed with it.
It’s essential to determine who will be providing HR support, including salary reviews, retention and motivation, coordinating vacation days, and giving out sick leaves. If the hiring party decides to handle all that, they may ask for lower subcontracting rates.
Minimal contract duration
This may be an issue if the client just needs to fill a talent gap for two to three months, while the outsourcing vendor works according to contracts six to 12 months long. Subcontracting professionals for two to three months is close to impossible if we’re not talking about specific, expensive specialists allocated for consulting.
Another lesson we've learned was the importance of planning resources beforehand. Yes, we sourced an impressive number of employees ready to join the project in two months, but if they had to start working right away, we would have had a much harder time finding specialists. And, of course, companies that can provide employees urgently demand higher rates.
The most exciting takeaway was that the great shift to remote work brought about new, interesting cooperation models. Today, a single engineer who offers a rare skill set can juggle different contracts. Of course, this will only work if the person is a mature professional who can handle several clients at once. With models like this, IT companies should think one step ahead to be prepared for market changes.
Finally, we've seen that if the client doesn't have an in-house IT department, they should choose a 'turn-key' model that includes hiring and further support. Otherwise, they will have to cope with millions of issues and arrangements that take up valuable time the client could have spent building their product.
This is how we managed to source 100+ developers, QAs, and DevOps within a tiny time frame, and so can you. With the takeaways we’ve discovered, we understand the current trends and changes in the IT market even better. And we're ready for new challenges. So if you're looking for a tech team that would implement your software idea, drop us a line. We'll be happy to help you out.