IT recruitment is a time and labor-intensive process that is increasingly becoming more arduous.
More and more companies are struggling to find the right talent to fill IT gaps. As a result, they’re dealing with stunted growth and unfulfilled potential.
In just three months in 2019, U.S. federal employment data revealed 918,000 unfilled IT jobs. This immense tech talent shortage is taking its toll on companies all over the U.S.
No matter the industry; healthcare, automobile, real estate, banks, or even Disney – every company is a tech company now. And HR departments are left scrambling to keep up.
In this post, we’ll briefly discuss why in-house IT recruitment has become such a challenge. But more importantly, we’ll dive into the strategy that you can use to side-step the developer shortage.
How Is IT Recruitment Affecting Businesses?
According to a 2019 report from iCIMS, it’s taking companies an average of 66 working days to fill tech positions. Once the positions are filled, the recruits must go through an onboarding and training process.
The same iCIMS report calculates the average company loses $680 per day per vacancy. Job postings, background checks, and lost days of productivity quickly add up.
Keeping IT personnel can be an even bigger problem than hiring them. A study using LinkedIn’s member data found that tech companies lose 13% of their IT team every year.
It’s Highly Competitive
Due to the IT shortage, large companies are going to great lengths to recruit. They’re going all out on robust benefits packages that include subsidized education, sponsored conference trips, and five to six-figure sign-on bonuses. This is making it hard for the small to midsize enterprise to compete.
It Hinders Growth
Kim Nash from The Wall Street Journal reported that 65% of CIOs agreed, “recruitment problems are hurting IT modernization efforts and project success rates are falling.” CIOs can have great ideas, but without the manpower to implement them, the ideas go nowhere.
Does IT Recruitment Have to Be This Complicated?
The good news is that you don’t have to limit yourself to competing for local talent. Nor do you have to go through an expensive recruitment agency.
The silver bullet? – remote teams.
When you open the door to remote teams, you can take advantage of worldwide talent. And do so without all the hassle, stress, and costs that accompany in-house IT recruitment.
How Do You Recruit a Remote Team?
Recruiting a remote team is as simple as finding a company that offers the service.
Now you’ve flipped the script. You’re no longer competing for talent in a limited pool. Instead, remote team service providers can compete to work with you.
First, you contact the service provider for a consultation. As they get to know more about your project(s) they can provide a quote.
How Does a Remote IT Team Work?
There are two ways you can work with a remote team; through outstaffing or per project.
Usually tech companies and tech departments already have a dedicated team of IT specialists. But maybe you need a specific set of skills for a specific project. In this case, you can remotely incorporate the specialist(s) that you need.
This work model is also referred to as ‘staff augmentation’ or ‘team extension’.
Why Choose Outstaffing?
In this model, you personally choose the candidates and manage them. Your managers have direct oversight and control over how the remote specialists integrate directly with your in-house team.
This model is like hiring an employee but without the extensive in-house recruitment process. And without the administrative/HR tasks.
In this model, you hire a remote team to carry out a project end-to-end. The remote team handles everything from staffing, managing, control, and maintenance.
This work model is also commonly referred to as outsourcing.
Why Choose Per Project?
The great thing about the per project model is that you’re paying for an end product. So, you get to make corrections and adjustments until you’re satisfied.
You don’t need to provide the work environment, the hardware, nor the infrastructure.
Why Work with a Remote Team?
Working with a remote team isn’t just a convenient way to avoid IT recruitment dilemmas. It’s also a popular productivity strategy that gets real results.
As many as 94% of IT companies report using some kind of outsourcing or staff augmentation because of its many advantages.
Strategic Advantages Include:
Flexibly Scaling Your Team Up or Down
Not only can you outsource full, end-to-end projects, but you can also hire one or two specialists as needed, and incorporate them into your team.
Let’s say you’re short one developer, instead of waiting through the recruitment process, you contact a remote team who provides one. Or perhaps you have a team of developers but you need a QA, or any other tech specialist for that matter.
It’s quick, efficient and your service provider is in charge of the specialist’s employment terms and benefits package. Freeing you up from the administrative tasks.
Saving Time and Starting New Projects
Not only do you shorten the recruitment process, but you also free up your in-house developers’ time by distributing tasks or even delegating full end-to-end projects.
With more time on your hands, you can tackle new projects, focus on tasks that have been put off, and grow your business.
Companies using staff augmentation and outsourcing report increasing their productivity by 15%.
Saving on Recruitment Expenses
Remote teams lower your expenses because you save money on the recruitment process and employee retention.
Because of the shortage of IT professionals, U.S. tech companies often look abroad for their remote team. Deloitte’s 2019 Global Shared Services Report ranks the top five sites for outsourcing and staff augmentation as India, Poland, Philippines, Malaysia, and Costa Rica.
IT service costs are lower in these countries, contributing to your savings. IT companies using remote teams report saving 10-30%.
Central America is especially appealing to U.S.-based companies because of its convenient time zone, similar business culture, and its solid handle on the English language.
Growing Without Roadblocks
Scale your business without waiting for new hires, without worrying if you have enough manpower to accept new projects, and without the pressure of maintaining a large staff on the payroll when demand is low.
Working Aligned with Your Morals
Oftentimes, small to mid sized IT companies and departments hire for a specific project. When the project is finished, you’re faced with two decisions:1) let specialists go (even though they took so long to hire), or 2) let them stay on the payroll until the next project comes along.
Whether using remote teams as a short-term or long-term strategic partner, it’s a flexible service that you can turn on and off, as needed. You’ll have extra staff only when there’s a budget for it.
What Are the Potential Risks of Using a Remote Team?
Of course, there is no ‘perfect’ way to work and using a remote team may not be the right choice for everyone. You should do your due diligence when finding the right remote team and consider the following aspects:
- The Human Factor – Time Zones and Business Culture
Many cost-effective remote team options are located abroad. For U.S. companies, the difference in time zone when you’re working with a remote team in Asia or Europe can be a rather large obstacle. Especially when you need to communicate in real time. It’s also important to remember that the country you are working with may observe different holidays.
You must also do your research and take into account their business culture. In the event of large cultural differences, how tolerant are you willing to be? One of the biggest mistakes that companies make, is never really considering the remote specialist as part of their team. And this lack of camaraderie can affect the work being done.
Many U.S. companies are beginning to opt for remote teams in Mexico and Central America instead of Asia because of this. The business culture, time zone, and holidays are largely similar. And their tech specialists, who are used to working with the U.S., are bilingual English/Spanish.
- Business Continuity
Does your service provider have business continuity plans? Can their business practices continue despite natural disasters or socio-political unrest?
A well-prepared service provider should be able to provide a business continuity plan. Do not hesitate to ask for such a plan when searching for a remote team.
“The higher the volume of sensitive data a third party manages and the more frequently they handle it, the greater the risk that the confidentiality of that data will be compromised.”
CIOs must consider the type of data that the service provider handles along with the volume they handle, and the frequency with which they are handling it.
If your company is handling highly confidential data, you should consider conducting occasional site visits to evaluate your remote team’s security and protocols for data protection.
Because of the IT professional shortage, IT recruitment complications are costing many businesses time, money, and progress.
Turning to remote IT teams is a popular strategy with large companies that is currently on the rise with small to midsize businesses.
Whether working per project or utilizing the outstaffing model, remote teams let you flexibly scale your team up or down with demand.
Interested in growing your business with a remote team?
Visit Nativo and book a consultation call. We can’t wait to hear about your project.