Most businesses outsource their non-essential operations to third-party companies. According to Statista, the global size of the outsourcing market before the pandemic was 92.5 billion dollars. The outsourcing market has been on the rise since 2000, before reaching its peak in 2012. After, we started seeing fluctuations in its numbers.
So it’s not a surprise that an outsourcing alternative, an extended team model, is gaining steam. This article defines an extended team and discusses how it differs from traditional outsourcing—the benefits of using one and when best to use one.
What is An Extended Team Model?
The model supports employing staff members from a near-shore or offshore country to work with in-house employees of a company. Another name for this model is staff augmentation—meaning the company uses an extended team to complement their in-house output.
Source: Globalluxsoft
Example of Extended Team Model
We know it sounds confusing, so let us use an example to elaborate on the definition. A company’s IT team is handling a project, but it is becoming more complicated. The project’s scope is expanding and showing signs of a long-term project.
The first is to hire more tech staff members to help with the project. The problem here is that hiring skilled labor takes time and money, two resources the company may not have to spare. However, platforms like SignalHire can significantly simplify and accelerate this process by helping you quickly find qualified candidates for a wide range of roles and organizations. Whether you’re looking for a software team leader, an early talent recruiter, or someone from a specific company like Atlantic Records, SignalHire provides direct access to verified professionals across industries.
Its second option is to employ experienced freelancers to supplement the current in-house workforce. Again, there is the problem of the individual having their attention divided with other client work.
The third option is to outsource part of the work or the entire team offshore. Here, the company will lose total control of the project and may not vouch for the quality. Its last option is to create an extended group of employees.
Establishing one will mean employing an offshore or near-shore team that functions as the in-house team. You have control of the members and establish direct communication with them, and they are an offshore IT team for the company.
The scenario highlights a simple example of how an extended group can be a good option for a company.
How Does Extended Teams Differ From Outsourcing?
In the example above, we highlighted some outsourcing options a company can use to tackle the problem of inadequate numbers and skills. Here, we will define outsourcing and look at ways it differs from this model. Outsourcing in this context is simply contracting work out of your company.
As mentioned at the beginning of the article, the outsourcing business is a billion dollars business worldwide. Both small and large cooperations practice it as it saves time and money. It can also be risky.
A survey by Credit Donkey showed 50% of companies that outsource their services worry because of the quality of the work. This is one of many reasons companies are drifting towards the extended group model that gives more control.
Source: agentestudio.com
There are three fundamental distinctions between the extended team model (one of the best alternatives to outsourcing) and outsourcing, and they are:
- Complementary
The essence of this model is to complement the existing in-house employees. The company does this either by adding to the core members or improving the expertise.
- Flexibility
Flexibility gives the management a lot of room to maneuver the team. You can quickly hire new employees as a project scales up or reassign jobs if you want the in-house employees to concentrate on another task.
It’s also possible to cut down if you think the company won’t need the services of the extended team in the foreseeable future. If the company outsources, it loses the opportunity to be flexible. Most of the decisions will take time to communicate and implement.
- Control
Control is a significant feature of ETM, and it helps to give you the power to control the quality of the employees. Training, better communication between the offshore team and In-house group, and better supervision mean that the company will not have to worry about its product.
Outsourcing means you lose almost total control of the service. It’s harder to control and supervise, and therefore the quality of output may fall and the reputation of the company at stake.
Why An Extended Team
The pandemic has created a vacuum in the labor force, and it’s becoming mainstream to outsource jobs from time to time to freelancers and other companies on a contract basis. While this may be good for a short-term plan, it may be more desirable to plan a long-term solution. Extended Teams have benefits that can aid both parties, and we will highlight some of them here.
Source: Daxx
- Plan Strategically
Having an offshore team under your control gives you the ability to plan. Since the extended team is part of the in-house team, it’s straightforward when planning strategically about tackling a project. Take this case study as an example.
- Set-up Is Fast and Cost-effective
Unlike setting up a regular team, an extended team is faster when setting them up. Speed is always crucial when a project is already in progress. And the in-house group is looking to bluff up or supplement the team.
Recruiting through traditional means will probably be time-consuming, and the person may not be skilled enough to resume the project at the level they expect them. The extended team recruitment is much faster because the in-house team is heavily involved, and they are more familiar with what they are looking for and where to find such people online. Traditional recruitment will usually entail recruiting locally.
- Improve Productivity
To be productive is to use the resources at hand efficiently and effectively to produce the best possible outcome. Companies build extended teams to provide an immediate impact on the team. The reason is simple, they have access to a wide variety of talent worldwide and can carefully assemble the best team they can afford.
Potential Challenges Extended Teams May Face
As with everything in life, there are two sides to a story, and in this case – an extended team model. We have looked at why ETM is a good option in the previous subheadings. This time, we will look at some challenges likely to occur if adopting an extended team model.
- Language Barrier
The extended teams are often not locals, so there could be a language barrier between the local in-house group and the offshore team. If the In-house team speaks and writes in English, then there must be a proper investigation to ensure the extended team has an acceptable level of English proficiency.
- Integrating with the Local Team
While it’s fast to assemble an extended team to assist the in-house group – obstacles like cultural and time differences can affect the assimilation of the ETM group.
- Skill Difference
There may be a vast gap in skill difference. This challenge may go either way as the core group on the mainland may be more experienced than their offshore counterparts, or vice versa. If either is the case, it will become a problem for the company.
Steps to Take to Make it Work
To mitigate the challenges, the company can adopt some of these activities.
- Plan Well
If you read most articles on model teams, they give the feel of putting together an emergency team for an impromptu project or multiple projects. And while this method is faster and often cheaper than regular recruitment, it requires some planning to pull it off. Questions like, Where do we get the people for this team? What qualifications are we looking for in the individual? Are they proficient in the local language? Are they ready to become part of an extended team and answer to our management? What countries are we considering? What means of communication are we using?
Some of these questions and many others will help with the planning stage. Alternatively, HR can have a contingent plan on how to handle the creation of an extended team. Planning months or years ahead will save valuable time.
- Proper Screening
The screening stage is essential in getting the right personnel through the door. While planning points you in the direction to go, the screening process allows you to dig deeper into the candidates or group of candidates. It helps to avoid problems like language and cultural barriers. This process also helps to gauge the skill set of the prospects.
- Onboarding
Onboarding ensures the new group can assimilate effortlessly with the home team. The onboarding step will require the efforts of both the in-house group and the extended group. Information regarding the project, kind gestures to lighten the atmosphere, and getting to know each other will help smoothen the onboarding process.
Conclusion
In conclusion, a company can decide to outsource one of its operations, but in a world where things are getting more uncertain. Most companies will want to be in charge of their offshore operations – so they can strategically move fast enough to weather through the economic storm following the pandemic.
Image source: pixabay.com
