Dedicated team vs. extended team: the difference

10 min read
July 14, 2022

In June 2022 alone, the Apple App Store released close to 36,000 apps. The figures for the Google Play Store were even more staggering, with 90,000 apps launched.

Indeed, it’s becoming a saturated market. The natural response is to develop better apps in a shorter time frame.

Unfortunately, this is straining the capacities of development teams worldwide.

A good solution? Outsource the task to a third party.

You have two options here. You can either hire an extended or dedicated team.

What are the differences between the two, and when should you hire one over the other? Let’s discuss that in greater detail.

What is a dedicated software team?

A dedicated software team is an outsourced group that functions just like an in-house development team, except that they’re a third-party service provider.

Frame 1684

What sets them apart is their involvement. Dedicated teams can and often create an app from scratch and even handle its maintenance once launched.

Hence, they offer a comprehensive range of services, including coding, testing, UI/UX design, project management, and graphic design.

Hiring a dedicated team differs from hiring both in-house staff or freelancers.

Frame 1685

Usually, you don’t recruit individuals yourself. Instead, you partner with a vendor or agency that will do that for you.

They will either interview and screen candidates on your behalf or have a talent pool that they can tap into.

Services01

Need a dedicated team for your app? —
Here’s how we do it →

The latter is the better option since they will be able to put together a team much faster. Thus, we recommend partnering with an agency that has this capability.

For example, DECODE has a pool of 70+ experts across a wide range of skills that enable us to create a team that fits any app requirement.

Good dedicated teams are also cross-functional by nature. That means members have the exact skills needed to bring the app idea to life and tackle any potential issues.

This is why dedicated teams are good at tackling app niches you don’t necessarily have experience in.

For example, suppose you want to enter the fintech market for the first time. In that case, you can create a dedicated team with a finance expert and compliance specialist.

This is an easier and cheaper path than hiring these professionals in-house.

Dedicated teams have been gaining popularity in recent years thanks to their effectiveness. Indeed, many high-profile apps became possible thanks to this model.

Famous brands that work with dedicated teams

Source: HQ Software

Dedicated teams are often conflated with extended teams, which is understandable since they have many similarities.

But they’re actually two different outsourcing models with specific use cases.

What is an extended team model?

In an extended team model, you hire experts or freelancers to cover up skill gaps in your in-house team.

Frame 1688

In other words, the extended team model is about augmenting your existing workforce. A dedicated team, on the other hand, is assembled.

Because an extended team is integrated into an existing team, they don’t have as much freedom in setting workflows and pipelines as a dedicated team.

They will need to conform to the in-house team’s existing system, tools, and methodologies.

Here’s another way to differentiate the two. A dedicated team model is more like outsourcing a core function (in this case, creating an app) to a third party.

On the other hand, extended teams are an example of outstaffing or hiring outsiders to perform in-house tasks.

Outstaffing vs Outsourcing whats the difference

Source: Lvivity

However, both models are similar in that they are third-party service providers. Functionally, they are part of your in-house team, but structurally, they are distinct.

A company would want to extend its team for one of two reasons.

One is that you need to expand your productivity to meet deadlines.

For instance, if you need to launch an app in three months but your team’s bandwidth can only achieve it in four months, you can hire additional developers to speed up the work.

The other is if you require specific skills for one-time niche projects. This is crucial in certain areas like finance or law, where you need a subject matter expert to guide developers.

In these cases, hiring a freelancer or consultant is more economical than getting a permanent employee on your payroll.

Like dedicated teams, you can partner with an agency to help source personnel for your extended team. However, you can also hire the staff yourself.

This is preferable if you only need one or two individuals for your team.

Frame 1690

Many of the best practices of forming a dedicated team also apply to extended teams.

You’re undoubtedly wondering which model to choose. We’ll spend the next sections discussing these. Let’s begin by laying out the pros and cons of dedicated teams.

Dedicated development team model pros and cons

The dedicated team model is popular because of its many advantages.

Frame 1691

One is that outsourcing is more cost-efficient than hiring in-house staff. You can access a global talent pool, which means you can hunt for the best prices.

Just look at how varied developer rates are around the world.

Limiting

Note that lower-priced developers don’t necessarily produce poor-quality apps. In the same way, highly-paid developers don’t often translate to the best results.

Indeed, Eastern Europe has carved a reputation as a region of developers who charge moderate prices but deliver world-class quality. It’s a good place to start your search.

Outsourcing also helps you avoid the substantial costs of hiring staff, which include benefits, training, equipment, and onboarding.

Indeed, a study by the Society of Human Resource Management discovered that onboarding an employee alone could cost $4,100.

Dedicated teams are also quicker to put together than an in-house team, especially if you partner with an agency like DECODE that already has a ready talent pool.

This allows you to skip the interview and hiring process, which can take weeks.

average length of interview process table

Source: Pesto Tech

The next advantage is that a dedicated team is better suited to tackle your app’s requirements.

Remember that teams are built based on the needs of your project. That means they’ll always have the skills to deliver an exceptional output.

This also makes dedicated teams very flexible and adaptable. You can easily scale them depending on your needs.

For example, you can easily bring data analytics experts to your team once your app has launched.

Or you can extend your dedicated team to include UX designers if you want to redesign your app later.

Now let’s get to the cons of the dedicated team model.

The most significant challenge with this setup is communication. Chances are, remote teams are in a different time zone.

Thus, some part of their schedule must align with your company’s working hours.

Then there’s the risk of a bad cultural fit.

Misunderstandings due to cultural differences and language nuances are possible, especially if your dedicated team is from a non-native English-speaking country.

Many clients underestimate this cultural aspect of outsourcing—to their detriment:

ljudi

Dedicated teams can also create security issues. Data transfers from outside networks and giving third parties access to your files are all cybersecurity risks.

You’ll need to put up extra protocols to mitigate them.

Let’s look at extended teams next.

Extended team pros and cons

The dedicated team model has many pros, which also apply to extended teams. That includes cost efficiency, flexibility, and the speed of putting them together.

In this section, we’ll talk about the advantages specific to extended teams.

extended team advantages

Source: Altamira

One is that there’s no need to replace your in-house team, making extended teams much less expensive and more cost-efficient overall.

This can help keep your budget within range while providing a substantial productivity boost.

There’s also no need to create new workflows or protocols with an extended team, as they should be able to adapt to your existing system.

Thus, you waste zero time trying to prepare as you would a dedicated team.

You also have more control over an extended team, as they’re technically an extension of your in-house staff.

This is suitable if you prefer a little micromanagement (but don’t overdo it) or simply want staff you can oversee.

Now, let’s look at two cons specific to extended teams.

The biggest is that the extended team might find it challenging to integrate with your system.

That’s because of their relative lack of freedom in using their workflows, unlike dedicated teams. This can lead to some delays as members try to adjust.

The other is that coordination can be challenging between your in-house and extended team, especially if they’re in the middle of a project.

This isn’t usually a problem with dedicated teams that work together from the start.

When to hire a dedicated development team?

Now we get to the big question—when does hiring a dedicated team make the most sense?

Here’s a quick rule of thumb:

Frame 1716

Generally, a dedicated team works best for large and complex apps in a challenging market.

Chances are that the app’s requirements will often change to respond to market forces, therefore making a fluid and adaptable team necessary.

Apps should also have a long timeframe (ideally a year or more) to maximize the benefits of a dedicated team.

Anything shorter, and you might have to pay more. Alternatively, you can opt for dedicated teams if you have multiple app projects you want to implement simultaneously.

Dedicated teams are also the way to go if the client has zero app development expertise. This happens if, for example, a non-tech client wants to develop a custom app for their business.

Rather than establishing an in-house development team from scratch, it’s cheaper and easier just to outsource it.

Finally, dedicated teams are ideal for clients who have minimal time to supervise a project.

Great dedicated teams should be able to progress independently yet keep the client in the loop at regular intervals.

When to hire an extended development team?

Now let’s consider when it’s better to extend your existing team instead of creating one from scratch.

when to hire an Extended Dev Team

The top reason is having a specific skill gap in your in-house team.

For example, if you’re developing a graphics-heavy app but don’t have designers on your payroll, you can hire an extended graphics team instead.

Subject matter experts like finance and health consultants are also common roles you can expand your team with.

Hiring them as an in-house staff is normally not economical unless you work in an app niche where they’re required.

Extending your team is also preferred if you’re short on staffing and facing tight deadlines simultaneously. In these cases, overworking your existing team is a bad idea.

Extending your team to help with the workload is a more cost-effective solution.

Speaking of cost-effectiveness, extended teams are also suitable if you have a tight budget.

That’s because it’s more economical to expand your existing team than to build one from scratch.

Our general advice is to look at the extended team model first and determine if it will solve gaps in your team. If it can’t, maybe an extended team is the answer.

It’s all about the quality of the team

Whether you want to extend your team or hire a dedicated one, what matters is the quality of the people you pick.

A subpar team or agency will not give you the benefits you deserve. In fact, it will harm your app through missed deadlines, unstable apps, or communication mishaps.

To avoid that, partner with an agency like DECODE, with its proven track record of many successful app projects and satisfied clients. That will give you the best chance at success.

Interested in working with us? Get in touch, and let’s start talking.

Categories
Written by

Marko Strizic

Co-founder and CEO

Marko started DECODE with co-founders Peter and Mario, and a decade later, leads the company as CEO. His role is now almost entirely centred around business strategy, though his extensive background in software engineering makes sure he sees the future of the company from every angle. A graduate of the University of Zagreb’s Faculty of Electrical Engineering and Computing, he’s fascinated by the architecture of mobile apps and reactive programming, and a strong believer in life-long learning. Always ready for action. Or an impromptu skiing trip.

Related articles