Outstaffing vs. Outsourcing: What to Choose for Your Project?

Let’s start with the basics.

Outstaffing and outsourcing are two ways to bring in external resources when your own aren’t enough. But, you know, there’s a fine line between them, and it’s important to understand it.

Imagine: all the developers in your company are overwhelmed with work. There’s no one to implement a new feature. This is where outstaffing comes into play. You bring in specialists from another company, but they work for you. They’re like temporary team members.

Now, another situation. Let’s say you have an online store, and you want to completely update it. But your in-house team consists of just one programmer who’s keeping up with tech support. This is where outsourcing comes in. You hand over the task to a contractor, and they handle everything—from design to launch. You just get the finished product.

1. The difference between Outstaffing and Outsourcing

Outsourcing and outstaffing are two ways that allow companies to optimize business processes. The main difference between them is the level of involvement of the external company and the control over task execution.

• In outstaffing, the external company just takes responsibility for employment relations (salaries, taxes) and oversees the work performed by the provided employees. In outsourcing, the responsibility for completing the project lies with the contractor.
• Companies often use Outstaffing to expand the workforce for ongoing projects or to handle temporary tasks—for example, bringing in additional specialists during peak workloads. Outsourcing, on the other hand, is used to delegate noncore business functions.
• With Outstaffing a company can quickly reduce or increase the number of workers.

2. When should you choose outstaffing?

Advantages of outstaffing:

• Full control over your project.
• Collaboration with highly qualified, vetted specialists.
• Flexibility in scaling the workforce.

Outstaffing is suitable for those who want quick access to qualified specialists without dealing with employment or tax issues. It’s a great fit when you’re short by 1–2 specialists for a short period, and hiring doesn’t make sense.

Outstaffing is ideal for situations when:

• 1-2 persons are needed.
• There are experienced managers.
• The scope of work isn’t determined.

3. When is outsourcing the best choice?

Advantages of outsourcing:

• The client doesn’t have to handle hiring or recruiting specialists.
• The contractor is responsible for setting up workspaces and organizing workflows.

Outsourcing is ideal for companies that want to offload certain functions and focus on developing their core business. It’s also perfect for situations where you need to implement a new feature, but your main team is fully occupied and doesn’t have expertise with needed technology. According to Clarion Technology, the IT outsourcing spending was $512 billion in 2024, a 11% increase from the previous year’s numbers. This fact proofs that IT outsourcing can be beneficial for business.

Outsourcing is worth it if:

• The project is a one-time task.
• The full team is needed.
• Internal expertise is unsent.

4. What are the successful use cases of outstaffing and outsourcing?

We want to share real examples of companies that have achieved success thanks to these models.

Outstaffing

Cargobite is an online platform for optimizing supply chains, needed to strengthen their existing internal development team and enhance the performance of their current web application. So they chose the model of outstaffing. We offered them 1 developer, who developed robust backend systems to support the platform’s needs, designed, deployed, and managed cloud-based infrastructure solutions on Amazon AWS, integrated backend systems with third-party services and APIs to expand functionality, and implemented best practices for backend systems and data protection.

Outsourcing

We worked with our client, Tinkerthinkers, an arithmetic school for children, on an outsourcing basis. They needed to develop a web application to complement homeschool and micro-school curriculums, aiming to be feature-rich, user-friendly, and easy-to-start. Since development is not their core function, and they do not have expertise in creating web applications, the school decided that it would be more useful for them to contact us.

For them, we introduced an online learning platform with features like progress tracking, internal currency, and a marketplace for student rewards. The lesson constructor streamlined teaching, and the project successfully executed architecture and integrated payment systems. You can read more about this case by following the link.

Another example of successful outsourcing is Bergmann Marina, a company in the marine domain. They asked us to develop a platform for syncing data between an office and ships. The solution successfully resolved regulatory compliance issues for shipowners, specifically ensuring adherence to maritime safety laws and standards. You can read more about this case by following the link.

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The right choice of development model can significantly simplify the process of creating software for your business, making it accurate, fast, and cost-effective. If you need to develop an IT system or strengthen your current team, leave a request on the main page, and we will discuss your project.