Dedicated Development Team: Why you Need it and How to Build one

A dedicated development team is a viable approach to software development that comes in handy in various scenarios. Some companies hire dedicated software developers to beat the competition and ship the product as fast as possible. Others use dedicated software development services to cover their sporadic need for development resources. Finally, a dedicated software development model is a cost-effective alternative to an in-house development approach.

The best testament to the success of this model is that companies are actively investing in it. In fact, the revenue in the IT outsourcing market is projected to reach US $512.50 bn in 2024.

A dedicated development model suggests expanding your unit by adding dedicated software developers located in a region with lower development rates, such as Eastern Europe, Asia, and Latin America. Such a team is called “dedicated” because it’s solely dedicated to the client’s project, working full-time. The client usually has direct access to each dedicated software developer. The vendor of a dedicated engineering team takes care of recruitment, employee retention, office space, IT infrastructure, HR support, and employee perks.

Dedicated software development: How it works

As we’ve mentioned before, a dedicated software development approach lives up to its name. It refers to a model where a virtual team is interwoven into a client’s software project, working from the vendor’s office. A dedicated development team is typically gathered by the vendor from the ground up and tailored to the client’s project. While the vendor takes care of candidate sourcing, establishing the workflow and synchronizing external and internal teams rests on the client. Below we dive deeper into the benefits of this model.

READ ALSO: How to Build an Offshore Software Development Center

Advantages of a dedicated development team

• It’s more affordable than in-house staffing. Accelerance reports that the hourly rates across software development roles increased by 23% in 2022. This highlights the financial benefits of dedicated development. Hiring a full-time software developer in the United States or Western Europe costs between $125,000-$200,000 per year, without recruitment, onboarding, administration, and employee benefits packages. With a dedicated development team, you can avoid added expenses that come with an in-house team, as they are taken care of by the vendor. Moreover, you can source tech talent in such cost-effective regions, such as Central & Eastern Europe or Latin America. 
• It resolves team scaling problems. The US Bureau of Labor Statistics reports that the demand for software engineers is expected to grow by a staggering 25% until 2032, which is 8 times faster than the average growth (3%). It only means one thing – competing for tech talent is going to be more and more difficult. Fortunately, there’s always an option to scale quickly with dedicated software developers whenever your project requires extra hands. A dedicated team model is best when you need to bring the project up to speed to meet the timeline requirements.
• You’ll get a jump on time-to-market. Speed is another benefit associated with a dedicated development team. In our experience, you can build one within 2-6 weeks, depending on the number of team members. 
• You’ll have access to developers with sought-after expertise. According to a recent report by Robert Half, 90% of tech managers say that finding top talent remains a challenge. This brings us to yet another reason to work with a dedicated team – the variety of specialists in the global talent pool. For example, in Eastern Europe, you can find a dedicated software developer with expertise in major verticals, such as healthcare, banking, fintech, and more. A dedicated team based in a skilled tech hub like this can bring the expertise you lack to the table. 
• Your office will be up and running around the clock. Running a remote team comes with its challenges, but this work model also provides a lot of coverage, given that two teams working 8 hours equals 16 hours a day dedicated to your project. This way, thanks to dedicated development, you can increase your development capacity ×2. 
• It frees resources to concentrate on your core business. A dedicated software team gives you much more time to focus on your core business and vital processes. It’s proven that by engaging dedicated teams, numerous companies have managed to bring technology solutions that had a transformative power on their business model. 

READ ALSO: Advantages and Disadvantages of Offshore Software Development Services

Disadvantages of a dedicated development team

• Time zone and communication barriers. The biggest challenges that come with a dedicated development team model is working across time zones. Collaborating with a tech unit located far away means your in-house and remote teams have little overlap for communication at the same time. To overcome this, you need to schedule your meetings around the common time windows. While such communication can be effective, it falls short of face-to-face interaction related to the in-house staff. Thus, a dedicated development team located in a nearshore zone, where time zone differences are negligible, can offer a solution to overcome this obstacle. 
• Management is more intricate. Running a dedicated development team is more complicated than running an in-house unit. You’ll need to account for time zone differences, culture differences, and work styles in your management approach. One thing you can feel sure about with dedicated development is that team members will be fully dedicated to your project, which is the essence of this model. Selecting the right vendor, and conducting regular meetings and surveys, just as you do with your in-house developers, will simplify your management. 
• It’s not the most flexible model. Although a dedicated development team offers more agility than in-house staffing, it’s still less flexible than Staff Augmentation (SA) in terms of adaptability. With SA, you can add team members to your project on an as-needed basis – as opposed to the rigid formation of a dedicated development team. Once a dedicated team is formed, integrating new skills can be problematic, as it may impact the entire project. 

Let’s recap this part. When choosing between an in-house and a dedicated team, many companies lean towards the latter, mainly due to the high costs of local developers. A huge stumbling stone with this model can be maintaining communication and team control in a remote setting. The key is in selecting the right tools and setting the right processes. However, it would be better for a manager of a dedicated development team to have relevant experience in managing remote teams. 

READ ALSO: How to Manage Your own Dedicated Development Team

A dedicated development team vs an in-house team: Key differences

“Should I build a dedicated team or a traditional in-house team?” Many tech leaders inevitably come across this question when the need for team scaling arises. Let’s compare the concept of a dedicated development team vs. in-house development across various criteria. 

Criteria	Dedicated development team	In-house development team
Location of the team	The team works in a remote office, often located in offshore/nearshore regions, for example, Latin America, Central and Eastern Europe, etc	The team works in your local office
Cost	Dedicated development is more cost-effective, mainly due to lower software development rates in offshore/nearshore zones	In-house staffing is more expensive due to expenses associated with permanent staff and overhead
Team control	The client runs the team remotely	The client has direct, immediate access to the team
Developer availability	Access to the pool of global tech talent	Confined to the local job market
Communication	Communication can be impeded by time zone differences and a language barrier	Face-to-face communication
Culture	Potential challenges associated with cross-cultural cooperation	More possibilities to build a unique company culture

What is the structure of a dedicated team?

The roles within a dedicated development team resemble those within an in-house unit, although you may want to backfill some of them with in-house staff. Let’s explore key roles in dedicated development.

• Project Manager (PM) 

PM is an expert who drives the software development process and supports your dedicated development team throughout the project. They will ensure your project stays on track and report to you on its progress.

• Business analyst (BA)

The role of a BA is to align the software development process with your business goals. Oftentimes, BA serves as a bridge between stakeholders and a dedicated development team. The key task of a BA is to ensure your business needs are translated into tech specifications. 

• Software Architect

A software architect is the mastermind behind your project. They design the overall structure and guide your dedicated development team on how to build and integrate different components of a software product.

• UX/UI designers

User Interface (UI) and User Experience (UX) experts will craft the design and usability of your software product. Their job is to create a user-friendly, intuitive, and attractive design for users. 

• Software Engineers

A development team, consisting of front-end and back-end experts, is the backbone of every project. These roles are the most costly on your dedicated development team. 

• Quality Assurance (QA)

QA experts are on guard for your software quality. They thoroughly check if your software meets the standards of usability, security, and performance before it goes live. 

• DevOps 

DevOps engineers focus on automating and refining processes aiming to enhance the speed, efficiency, and quality at every stage of software development.

Dedicated software development: Cost

Now that we’ve analyzed the key roles, let’s dive into the cost aspect. Below, we compared the rates of various tech roles in North America with rates for the equivalent roles in nearshore/nearshore zones. We believe this information may be useful for you to make an informed decision when selecting the location to build your team. You can see that opting for LATAM or CEE for dedicated software development is more cost-effective than in-house staffing in North America.

Role	Hourly rate, North America	Hourly rate, Latin America	Hourly rate, Central & Eastern Europe
Project manager	$96–$123	$59–$82	$53–$78
Business Analyst	$109–$154	$56–$68	$57–$81
Software Architect	$139–$182	$72–$96	$71–$95
UX/UI designer	$79–$100	$48–$75	$53–$71
Senior developer	$143–$172	$65–$82	$68–$76
Intermediate developer	$119–$144	$53–$66	$47–$65
Junior developer	$75–$91	$41–$53	$35–$53
Quality Assurance expert (Automated)	$167–$74	$35–$72	$32–$74
Quality Assurance expert (Manual)	$139–$62	$66–$34	$61–$26
DevOps	$148–$114	$59–$82	$62–$79

How to build your own dedicated development team: Step-by-step guide 

When building a dedicated software team, you want to source dedicated software developers with the right skills to bring your project to success. There are two major parties involved in this process: Customer and Provider. The responsibilities are typically divided in the following way: 

The provider takes care of: talent acquisition, IT infrastructure, office space, dedicated software developer retention, administration, payroll, paperwork, team building, and employee benefits. 

The customer is responsible for: providing Project Scope, team effectiveness measurement, communication, and company culture.  

Now that we’ve outlined the responsibilities of each party, the next question would be where to start? 

Step 1. Define your requirements

Before contacting the vendor, your team should decide on a tech stack and prioritize features so that a vendor can build a dedicated development team based on your needs. Giving information about your company will help find developers who would be a good fit in terms of company culture.

Step 2. Interview candidates

Typically, the hiring process includes several rounds of interviews. The candidates are initially verified by the vendor’s team, which involves technical and HR interviews. Then, the candidates who’ve made the cut are forwarded to the client for client interviews.

During the hiring process, you may want to take the provider for a spin. Take notice of their company culture, communication style, and ability to meet your requirements. That will allow making an informed decision. With nCube, there’s no need to pay upfront until you are ready to hire a dedicated software developer. We also are open to signing a non-disclosure agreement before we start our cooperation.

Step 3. Launch your team

If you have chosen the team members carefully, chances are high that your dedicated development team will be a success. At this point, a lot depends on your involvement in the project. Set up the processes and communicate with team members regularly. If you choose nCube, you’ll be working with developers from CEE or LATAM who have high technical proficiency, a problem-solving mindset, and strong communication skills.

Dedicated software development team: Where to build it?

These are regions that are the most comfortable for launching your dedicated software development team. 

Eastern Europe

When it comes to the best countries to launch your dedicated development team, many Eastern European countries (Ukraine, Poland, Romania, etc) are globally recognized as hotspots for this activity. 

In Eastern Europe, developers have vast experience working on global software development projects and excel at diverse technologies. Particularly, Ukrainian and Polish developers are well-versed in JavaScript, Java, C#, Python, PHP, Swift, and C++ as well as in-demand fields, such as Data Science, IoT, Blockchain, and AI/ML. 

When you go for dedicated team development in this region, you can rely on a repository of nearly 1 million expert IT specialists. Dedicated team development in this region is also a lucrative option thanks to a convenient time zone, no-barrier communication, and minimal cultural discrepancies. So, when sourcing dedicated software developers from Eastern Europe, you can optimize your budget without any trade-offs. 

READ ALSO: Offshore Product Development: Eastern Europe, Latin America or Asia? 

LATAM

LATAM is currently a growing tech hub, where such countries as Mexico, Argentina, and Brazil stand out as the most popular destination for dedicated development. LATAM is also a preferred region for US-based companies seeking nearshore opportunities. 

Akin to Eastern Europe, LATAM offers affordable software development rates compared to North America. LATAM nations are close to the US when it comes to the time zone, so many businesses prefer to launch dedicated software development teams in this region. Besides that, providers in LATAM are laser-focused on North American projects, which allows them to have a deep understanding of their inner workings, requirements, standards, and goals.

We at nCube focus on both of these regions and will help you set up your own dedicated development team in the destination of your choice. 

READ ALSO: Why is LATAM Software Development Thriving? 

A dedicated development team: Is it the right approach for your business?

To summarize our post, we’ve gathered a few scenarios where adopting a dedicated development model may be a suitable choice for your business. 

• Your organization lacks software development expertise;
• You need to rapidly scaly up your development capacity because of an increasing workload;
•  You need a sustainable development team for projects with long development cycles;
• You want to accelerate time-to-market by building a skilled development team fast;
• You want to add skilled technologists without delegating team control and SDLC to the vendor;
• You lack specific skills for a particular stage of SDLC, for instance, Quality Assurance;
• You want to shift the focus of your core team toward strategic initiatives rather than stick to a day-to-day development routine. 

At the end of the day, there is no universal recipe for developing software. In some scenarios, it’s best to go with an in-house software development team. In others, a dedicated team can be a good solution, especially when you want to scale your internal team fast and prune the extra costs associated with an in-house team. Together with a dedicated development team from nCube, you can build long-term relations with the best tech talent in Eastern Europe and LATAM. Let’s connect.