Year after year, several companies seek digital transformation and consequent business model modernization. With such technological development comes a unique set of challenges – including rapid growth in the demand for specialized labor and the struggle to hire an efficient technical team.
There are various models in place that companies can follow to close talent gaps and meet the growing demand for skilled tech workers. The question is, which one should you choose? This article gives a comprehensive insight into three technical recruitment models – independent contractors, an agency, and staff augmentation.
As businesses look ahead to 2023, let’s weigh the pros and cons of the different recruitment models to help you choose what best suits your requirements. We’ll also embark on a recently developed hybrid, ’the dedicated teams model,’ that combines the best of these three methods and eliminates their limitations.
What is Technical Recruitment?
Technical recruitment can be thought of as an umbrella term that involves sourcing, screening, and assessing candidates to fill specific technical positions that make up a modern IT workforce. Nearly every company with an active IT staff includes developers, security analysts, administrators, and engineers. However, companies that offer services like app modernization, cloud migration , digital transformation, and setting up big data analytics require technical talent with specialized skills, such as cloud migration officers (CMOs), cloud consultants, data scientists, etc.
Technical recruitment isn’t very different from traditional recruitment. While an in-house HR manager with a good understanding of technology can find and hire technical talent, this process can become complicated for non-tech companies and SMBs. To avoid such problems and establish a competent, cost-effective IT team, let’s evaluate three popular models of technical recruitment:
- Independent Contractors
- Agency
- Staff Augmentation
The Top Three 3 Models of Technical Recruitment in 2023
As businesses innovate, scale and digitally transform operations to edge out competition, it becomes challenging to hire the best technical talent. To fulfill the unique needs of companies and the highly varied roles required in a modern IT staff, different models of technical recruitment have surfaced.
In keeping with trends for 2023, let us assess the best three models of technical recruitment, each with its own set of advantages and disadvantages, and choose the one that emerges at the top.
Independent Contractor
Independent contracting is one of the most popular forms of employment for specialized roles. The reason being independent contractors are experts in their industry and bring their specialized skill set to a particular project or task for a set duration. They can be found in just about every industry, be it IT, marketing, or healthcare.
It’s important to note that independent contractors are not employees but separate legal entities. Thus, as opposed to traditional employees, they are solely responsible for performing the services outlined in a contract or Scope of Work (SOW). Let’s take a deeper look at the pros and cons of independent contractors.
Pros of Independent Contractor
- Flexible
Independent contractors are more flexible in their terms of service. They allow companies to respond to specific business needs and are often used to working for different organizations, in different locations, for varied periods of time. - Highly specialized skill sets
Independent contractors usually have years of expertise in a single field and are accustomed to working on niche projects that require their specific skill set. Thus, they’re a viable and attractive alternative to full-time employees. - Overall lower costs
Independent contractors may have a higher hourly rate or a higher upfront cost. Still, in the long term, they are more cost-effective than full-time employees since they do not require an annual salary or other associated costs of hiring a permanent employee. - Minimum training required (if any)
Independent contractors are highly skilled in their field of work and experienced with working in new environments. The combination of these two factors means that independent contractors require minimum training (if any at all) and can get started on your project as quickly as possible.
Cons of Independent Contractor
- Different working styles
It’ s possible that the independent contractor you decide to work with may have a different working style than the rest of your team, which would take getting used to and, in some cases, might lead to miscommunication.Additionally, when most of your workforce constitutes independent contractors operating from different countries, timezone calibration becomes challenging. Gathering relevant stakeholders into a meeting is a hassle and real-time collaboration takes a hit. - Additional management
Hiring independent contractors means allocating additional management roles for regular work supervision. This may become even more difficult as the number of contractors in a company increases. - Transitioning Friction
When independent contractors go on vacation or no longer contribute to your company, the KT (Knowledge Transfer) is something to consider. The independent contractor must bring the relevant internal stakeholders up to speed with the altered business processes or technologies to ensure a smooth transition.
Agency
Another model of technical recruitment is outsourcing agencies. It could serve as a better alternative to hiring independent contractors by eliminating the need to scout multiple individuals. The agency forms and manages the team and takes more responsibility for the final result and quality of the project. This model operates on mutual trust between the two partnering entities.
Pros of Agency
- Faster recruitment
Hiring an agency is undoubtedly faster than hiring a team of experts yourself. Agencies maintain a talent pool with a wide range of skills that can be deployed to new projects on very short notice - Minimum managerial overhead
There is reduced management overhead since the outsourcing agency works independently. The manager only needs to be in touch with the agency contact to receive updates on the progress made. This eliminates the need for constant supervision and allows the client company to focus on the end result. - Capable of larger and diverse projects
The larger and more diverse talent pool allows agencies to take on different types of large-scale projects. Thus, hiring an agency is an excellent choice for large-scale, one-off projects such as digital transformations and platform migrations.
Cons of Agency
- Premium for convenience
The overall costs for hiring an agency will be higher compared to a group of independent contractors because you are paying a premium for the convenience of external management and recruitment. - Relevance to Company’s Mission & Vision
One major challenge about the agency recruitment model is shortlisting suitable entities. The right agencies must fit with your company’s core values and expertise expectations.
Staff Augmentation
Staff augmentation refers to an employment arrangement where a third-party service provider, usually a talent agency or Managed Services Provider (MSP), helps you form and employ temporary staff to fill specific skills gaps in your organization. While this is a type of outsourcing, staff augmentation is closer to traditional employment in structure.
In this model, the hired workers are temporary employees of the company. While an outsourcing agency creates milestones and manages the whole process, in staff augmentation, the recruits work in tandem with your internal teams, and you manage the new employees as your existing ones.
Pros of Staff Augmentation
- Greater control
Staff augmentation teams are like company employees. Thus, there is greater flexibility in the projects/tasks assigned, reduced turnaround times, and quick scalability response in accordance with project needs. - No additional/separate management
Employers will manage staff augmentation employees the same way they would any other employee; there is no need for additional management. - Cost-efficient
Staff augmentation is much more economical than hiring full-time employees while achieving the same results because you only pay for the skills/talents you need at a given time. - Fills the gap in smaller internal teams
Staff augmentation is particularly a great option for companies that are slowly building their internal IT staff but need full-time employees specializing in certain fields for specific time periods. The management has greater control over the team, and it allows for cohesion and effective greater teamwork.
Cons of Staff Augmentation
- Long-term costs
Staff augmentation is an excellent option for short-term projects, but long-term costs are comparable to or may even exceed full-time employment, depending on the project. - Internal knowledge
Staff augmentation teams work as internal employees, but they do not possess historical knowledge of the company or have access to any confidential information, which can limit the scope of their work in certain scenarios.
The Modern Solution: Dedicated Teams Model
Each of the three technical recruitment models we discussed has drawbacks, which could sometimes be deal breakers. To bridge these gaps, we at D3V set out to create a hybrid recruitment model that would retain the benefits of external technical recruitment, such as low costs, flexibility, and autonomous working styles with limited supervision required.
After several trials, we finally came up with the Dedicated Teams Model, a hybrid recruitment model built specifically for the challenges faced by legacy and modern businesses alike. This modern form of technical recruitment is in keeping with future trends. It enables companies to hire flexible technical teams capable of spearheading entire technical projects such as cloud migrations and app development, and also allows them to work in tandem with a company’s internal team during peak season or when a company is just building out its technical staff.
Since the Dedicated Teams Model encompasses the best of the three top technical recruitment models and eliminates their limitations, it has proven to be a game-changer in our practice and dealings with our clients.
Getting Started with Technical Recruitment
Technical recruitment is a common challenge for non-tech companies that have either adopted new technologies or have recently undergone a digital transformation. In both of these cases, there is often an immediate need for technical staff to take over administrative and development tasks from the cloud migration/digital transformation teams. However, since there is limited technical knowledge in the HR departments of most small-medium businesses, technical recruitment can be a slow and inefficient process.
The methods we have discussed above can help you altogether avoid these challenges as you look to bolster your specialized technical staff in 2023. However, in case you’re finding one too many trade-offs in the three forms we’ve discussed, you should take a deeper look at the dedicated teams model. To learn more about how this model can be implemented into your business, book a free consultation with one of our cloud-certified experts today.
