Dedicated Team vs Extended Team: Choosing the Right Team Model For Your Project

Key Takeaway:

Table of Contents

Introduction

It seems the IT outsourcing industry is at the top of the heap. According to Statista, the industry is poised to generate a revenue of $512.50 billion in 2024, boasting an estimated growth rate of 10.99% that will elevate this market to a resounding $777.70 billion by 2028. That’s correct, ladies and gentlemen; the future of IT Outsourcing shines brightly and boldly as each passing year presents us with an abundance of expansion opportunities.

The explosive growth of IT outsourcing reflects the advanced need for flexible, innovative, and expert solutions. However, a one-size-fits-all approach doesn’t work, and businesses face challenges in choosing the best team model for their project. This is where a dedicated team and extended team come into the picture. In this blog, we will walk you through the importance of the team model, insightful dedicated team vs extended team comparison, and know when to hire which team model for excellent decision-making for your project.

Understanding Dedicated Team

As the name suggests, dedicated teams are the outsourced teams hired for specific projects or skills. The dedicated team is recruited based on the project specifications and for a longer duration.

The entire team has exceptional expertise. A dedicated team can be categorized into two main types: internal dedicated teams and external teams. In the case of internally dedicated teams, managers curate a group of individuals, each possessing distinct skills tailored to a specific project. For example, a dedicated UI/UX team is formed during the mobile application development project. This team remains consistently engaged in tasks assigned by the manager or team lead, working cohesively until project completion or goal achievement.

Advantages of Hiring a Dedicated Team

• Complete control over resources
• Access to global talent and optimization technical capabilities
• Professionals with extensive skill sets and experience
• Strategic planning and improving quality assurance

Best for: Long-term projects and meeting certain goals

Understanding Extended team

The extended team combines an expanded in-house or existing in-house team and an external team that helps you upscale software development with expertise. The extended team supplements the expertise or capacity of the internal team for a specified time. Moreover, the team unlocks the potential of existing or new projects with their technical skills and enhances the software development capabilities. Simply put, the extended team would be the right hand of the in-house team, who will help accomplish specific projects with their skill set.

Advantages of Hiring Extended Team

• Scalability and technical capabilities
• Specialists work on niche projects
• Streamline processes and increase productivity
• More cost-effective than hiring additional staff

Best for: Short-term projects and adding specific skills and expertise to scale up an in-house team.

Dedicated Team vs Extended Team: Key Differences Explained

The following primary differences help you make data-driven decisions in team models. Understanding which team model, extended team or dedicated team, aligns with your project requirements enables you to achieve goals.

1. Flexibility

The outsource team model requires flexibility as they must perform tasks assigned by another organization or manager. Both dedicated and extended teams are flexible with outsourced functioning. However, a closer comparison reveals that extended teams offer superior adaptability.

Dedicated teams operate with limited resources and usually adhere to a limited set of tasks aligned with specific projects. The scope of their dedicated work constrains their flexibility. Conversely, the extended teams have higher flexibility as they seamlessly adjust to the project modifications. If needed, they can scale up resources and adapt the requirements accordingly.

🏅 Verdict: The dedicated team is the definite champion of flexibility.

2. Scalability

When it comes to scalability, the extended model is the clear winner. If a dedicated team model offers scalability in terms of resource flexibility and workflow, its long-term commitment might hinder the ability to make swift adjustments. On the contrary, a dedicated team can easily alter its size, but only for a defined period as per the demand.

With the extended team, you can scale up or minimize resources with professional talents and allocate resources based on the projects. Moreover, the extended teams are the external support of your in-house team, so it will be easier to adapt to evolving changes as they can adjust the workload.

🏅 Verdict: The dedicated team stands ahead of the extended team regarding scalability.

3. Communication

Streamlined communication is significantly essential for the outsourcing software model, whether it is an in-house team or an external team; efficient communication is a must. Coming to the best communication, a dedicated team secures the top position. A dedicated team has clear and better communication because of the fix set.

On the contrary, an extended team also has clear communication, but there can be changes as both internal and external teams work together. Moreover, the requirements keep changing, which may cause issues for the long-term project.

🏅 Verdict: A dedicated team offers the best communication in the team model.

4. Process and tools

Both extended and dedicated teams are equally excellent when it comes to processes and tools. A dedicated team follows a well-defined process, ensuring streamlined work efficiency and internal communication, given the pre-defined tasks and team structure. On the other hand, the extended team introduces a layer of adaptability to this seamless process, transforming it as per the evolving demands of the organization.

A dedicated team uses numerous collaboration tools, like Slack or JIRA, catering to agile and waterfall project management methodologies. Likewise, extended teams leverage a spectrum of project management tools, including video conferencing, document-sharing platforms, and collaborative tools, effectively bridging the physical distance and enabling seamless collaboration.

🏅 Verdict: In extended team vs dedicated team, both are equally dynamic and efficient.

5. Security

Security plays a vital role in outsourcing software development. Both team models provide robust security in the dedicated team vs extended team. The dedicated team offers high-security standards and protocols, which allows the team to have direct control.

On the other side, extended teams provide mid-level security as they have limited organizational control. Moreover, they follow specific security practices and depend on managers to guide them.

🏅 Verdict: A dedicated team provides more robust security than an extended team.

6. Future Prospects

The comparison of the future evolution of a dedicated team vs extended team; both team models contain the brilliant capability to enhance a project. Moreover, you can expand the resources in the future, as both provide flexibility to scale up or down the resources.

In addition, the demand for dedicated and extended teams is also high, so you can choose either of them for your project.

🏅 Verdict: Both offer a dynamic future in terms of resources.

7. Popularity

Comparing an extended team vs a dedicated team based on popularity can be daunting because both are popular and preferable on their own terms. For instance, businesses seeking high control over processes and resources choose a dedicated team for long-term projects.

Meanwhile, the extended team suits businesses looking to add value to the project and specialized skills to their existing team. Moreover, it is also preferable for small-term projects and mid-size companies that want to achieve their goal with a certain skill set.

🏅 Verdict: It varies on project specification, so both are crucial.

8. Agreements

As a business owner, you know the importance of agreements in outsourcing projects. One mistake, and you will lose money, resources, and intellectual property rights. So, if we compare extended and dedicated teams, dedicated team agreement is more systematic and comprehensive than the extended team model.

The agreement of a dedicated team is between the service provider and client, when in fact, the agreement of an extended team is within the hired company. The dedicated team model has pre-defined agreements restricted until the projects are completed, and extended team model agreements can vary according to the organization’s project specification.

🏅 Verdict: A dedicated team is preferable for secure agreements.

9. Cost-effectiveness

One of the most crucial and most compared points in the dedicated team vs extended team is cost-effectiveness. But jumping to the best part, both team models are cost-effective, wherein project timeline plays a pivotal role. The dedicated team is cost-effective for long-term projects; on the contrary, the extended team is for short-term projects.

Moreover, the choice between the two models depends on the desired skill set and time constraints. Opting for an extended team suits scenarios where specific skills or specializations are needed for a limited duration, following a pay-per-skill model. On the other hand, a dedicated team aligns with fixed budgets for a comprehensive and sustained project engagement.

🏅 Verdict: Go for a dedicated team for long-term projects and an extended team for short-term projects.

10. Range of services

The last and equivalent essential point in extended vs. dedicated teams is the number of services team models can offer your business. A dedicated team provides tailored expertise, long-term relationships, ongoing development support, and a collaborative environment.

On the other hand, extended teams provide efficient project management, resource augmentation, quality assurance, and hands-on technical expertise and skills.

🏅 Verdict: It varies based on project needs, as both are scalable and flexible in their way.

When to Hire a Team Model?

Although dedicated teams and extended teams are part of the IT staff augmentation model, they vary significantly. Hence, it is crucial to know when to hire which team models.

When to Hire a Dedicated Team Model?

The following situations will help you understand when to hire a dedicated team for your business project.

⮕ Hiring a dedicated team model would be better if you are an early-age startup expected to grow. It allows them to build a team quickly and save on hiring an in-house team to develop the product. As a result, they can focus on other essential tasks, such as marketing or branding their products. Most of all, it will be cost-effective for startups to hire a dedicated team model because they are not required to recruit an entire in-house team.

⮕ A mid-size company might hire dedicated software development team when they have complex long-term projects or want to fill the skill gaps and avoid overburdening their in-house teams. When they hire a dedicated team, it allows for long-term scalability and knowledge retention.

⮕ Large companies prefer hiring a dedicated team when they are interested in entering new markets or want to launch a disruptive product. A dedicated team is helpful for large enterprises when they are interested in internal R&D or want to integrate a new company smoothly. Besides, by hiring a dedicated team, large companies leverage niche skills that are absent in an in-house team or when they want geographic expertise.

Also, hire a dedicated development team when:

• No experts on hand
• Lack of skill set
• Complex projects to handle
• Access to the latest technologies
• Internal process optimization

When to Hire Extended Team Model?

Let’s understand and avail the insights on when to hire an extended team model with the examples.

⮕ A startup will seek an extended team to fill the skill gap. The company hires an extended team of professionals with proficiency and in-depth knowledge about specific skills required for the project. The extended team offers solutions that help them to achieve their goals and enhance their product.

⮕ The requirement of mid-size companies to hire extended teams is to have additional support. In such situations, the companies look for extended teams who work closely with in-house teams and provide them with advanced features and quality work. It is like adding a few new members to finish that project.

⮕ The large enterprise seeks extended teams to accomplish their goal faster. Large companies have multiple tasks and will require extended teams to bring innovative ideas and skills to enhance their projects. Moreover, it saves time recruiting new in-house team members and performs better as they are specialists in specific tasks.

Also, hire an extended development team when:

• Shortage of in-house expertise
• Lack of specific skills
• Restricted budget
• Urgent tasks to complete

Note: The project and reasons to hire could vary from different companies, so hiring just focuses on the team model requirement checklist.

Emerging Trends and Industry Changes in Team Models

The rise of Hybrid team configurations is one of the significant shifts in the IT outsourcing markets. By blending in-house talent with eternal experts, many companies leverage the power of dedicated and external teams. Due to the innovative, flexible approach, global organizations are now maintaining core competencies in-house and accessing specialized skills as and when needed.

Well, it indicates how the industry has shaped remote working and adapted it as an emerging trend and change for the team models. For instance, now you can hire any freelancer from around the world easily. Additionally, new advanced technology like Artificial Intelligence, Machine Learning, Big Data, and others play a pivotal role as they redefine working models. As per the PwC report, nearly 99% of companies have adopted an AI-based approach to streamline operations for a few or multiple tasks.

One of the notable shifts in IT outsourcing models is the prominence given to Agile methodologies. It does not matter whether you are hiring a dedicated team or an external team. Companies are emphasizing using agile methodologies to enhance adaptability and responsiveness.

Data security has become a significant concern in today’s world as remote work becomes more common. Organizations hiring dedicated teams and extended teams want these teams to take measures to protect this data proactively. These measures include access controls, regular security audits, and continuous training on cybersecurity.

If you want to stay updated and avail all the benefits of emerging trends and smart innovations, get in touch with Bacancy. We have a team of developers who will help you choose your ideal team model with their in-depth knowledge and years of experience. Besides, we have lucrative team models where you can hire our developers on hourly, monthly, or fixed cost-based projects.

If you are looking for more information on offshore dedicated teams, you can download our white paper – Offshore Dedicated Development Team: Hire, Manage & Leverage

Conclusion

Both dedicated and extended teams have their advantages. This comparison blog post of dedicated team vs extended team will help you make informed decisions to enhance your project. Dedicated teams are ideal for long-term projects, while extended teams work well to add value to existing projects. However, you need to determine a team model that aligns with your goal and provides numerous benefits to your product or project.

Frequently Asked Questions (FAQs)

What is team extension?

Team extension refers to the augmentation of your team with in-house professionals to fill the skills gap and create software development. It is another term for staff augmentation and a flexible staffing model that scales up your project.

Can you hire both a dedicated and extended team for your project?

Yes, you can simultaneously have dedicated and extended teams for your project. It depends on your project requirements, like certain functionalities, additional niche tasks, or specializations.

What would be the cost to hire a dedicated team model and an extended team model?

Hiring a dedicated team model would cost you around $1000 to $5000, depending on the project time and resource requirements. An extended team would cost in pay per hour to be nearly $70 to $1000.

How do I choose the right type of team for my project needs?

While choosing the team for your project, consider the following points:

• Project expectations
• Skill requirements and level
• Budget and commitment
• Control and integration

Is it possible to switch from a dedicated team to an extended team?

Yes, you can easily switch from a dedicated team to an extended team; however, a few factors require consideration before executing changes in the project.

• Minimize and maximize team resources
• Project scalability should not be hampered
• Requirement of additional skill set