How to cope with the increased shortage of technical IT skills in Western Europe? Engaging IT resources at offshore or nearshore locations where the availability is better, seems the most obvious solution. But how does it work?
Basically there are two ways:
- Execute the work at an offshore/nearshore location. This is known as ‘remote timehire’, ‘out staffing’, ‘dedicated development teams (DDT’s)’, or – if the provider is taking result responsibility – ‘outsourcing projects’ or ‘outsourcing services’.
- Bringing the wanted IT staff from offshore/nearshore locations to the (onshore) client location. This is called ‘fly-in’. It may apply for both temporary and permanent staff.
Recommended for clients
As a client, what should you choose: remote timehire of fly-in? Reasons to choose remote timehire:
- Cost of remote timehire is around 50% lower than fly-in
- Flexibility is much higher, which is important when the team is growing or shrinking or staff needs to be replaced in case of underperformance, sickness or holidays.
- Administration for remote timehire is much simpler than for fly-in (travel, housing, work permits, taxes and labour legislation).
- People management, quality assurance, office space and infrastructure for remote timehire are easier than for fly-in. Often the IT provider has included this necessary overhead in the hourly rate.
It looks like remote timehire is more attractive than fly-in. However, many low- and midlevel managers at the client’s side prefer fly-in. Why?
- They like to ‘see’ their staff, to have a better feeling of control, despite modern communication technology.
- Worries about the social coherence while managing a team distributed across two or more locations.
- Unfamiliarity with different cultures and fear communications issues.
- Bad experiences in the past while working with remote staff.
- If the remote operation is too successful, they fear that senior management may decide to offshore/nearshore a larger part of the IT operation, which might result in losing their position for the low- and midlevel manager.
Senior managers are usually more open to remote operations, since they look at the cost and since their job won’t be jeopardised.
Recommended for providers
As a nearshore or offshore IT service provider, what should you choose: offering remote timehire of fly-in?
The reasons for preferring remote timehire above fly-in are for IT service providers more or less the same as for clients. Additionally they are facing issues with their staff who don’t like working abroad for a longer time. Therefore most IT service providers are just offering remote timehire and no fly-in.
However, in most cases it’s the client who decides instead of the provider.
This leads to an unbalanced situation where most clients are asking for fly-in while providers are offering mainly remote timehire.
The few IT service providers or recruiters, who are able to deliver fly-in staff, will find themselves in a market without much competition. They will be the champions.
In case you don’t know where to find fly-in clients or providers, please contact us.
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