Engagement Models In IT Industry

Each project is individual, so a special approach is needed when choosing the type of interaction that will meet the requirements of development.
Therefore, in this article we will find out what is an engagement model and how to select the best interaction variant for the successful implementation of an IT project.

What is an Engagement Model?

In order to properly build the partnership among the client and the supplier, you should select the right and optimal project engagement model. Before picking the ideal option for you, study all the details of the project, namely its size, strategies and concepts.

The software development engagement model is a specific concept on which the relationship between the customer and the supplier will be based throughout the work.
It is engagement models that help to properly build the entire work process. You discuss the payment method, terms and deadlines, management issues and much more that is necessary for the implementation of a quality project.

Many are wondering if there is such a model that will suit everyone? The answer is obvious, there is no such model of interaction. As mentioned earlier, each project is unique, so it needs to be approached accordingly.

Types of Engagement Models

To date, there are several basic it engagement models. They differ in their conditions, price, as well as a unique mode of operation. Therefore, now we will consider the most famous of them and get acquainted with their features and characteristics.

Relationship-Based Business Engagement Models

Software engagement models differ mainly in terms of the level of involvement of developers in a future project. Therefore, now we will look at the 3 most popular examples of interaction models that are built on relationships and their main characteristics.

Outstaffing Model

This is a very interesting business engagement model that can be described as an exchange of time for money. The bottom line is that people start working for you, but officially they have a different employer, namely an outstaffer. Payment is usually done by the hour.

This model is used when companies need to expand the team. As a rule, all the necessary equipment, jobs and other points are provided by the outstaffing company. Thus, you save your money, which may be associated with the above costs. The main advantage is that you, as a client, are in full control of all the activities of the company.

In many cases, outstaffing is done remotely as teams may be based in other countries. Therefore, try to choose a provider of such services, which will be close to you. Do not forget about his local time, it should be optimal and convenient for cooperation. This is necessary to simplify the process of work and interactions.

Pros

• Versatility. You may quickly customize the process of drafting. You run all the stages related to personnel, so you might quickly set the amount of the team and adapt the number of employees in compliance with your business.
• High level of knowledge. Extensive experience, unique skills and knowledge in your industry – all this you can get from specialists who will cooperate with you.
• Process adjustment. When you hire outstaffing specialists. You are in the complete run of the all process. At any time, you can correct the workflow.

Cons

• Difficulties with communication. Often this model of cooperation involves joint activities with companies from other lands. Therefore, there may be problems with language barter and other features of the culture of the country of developers. It is best to discuss the moment of language and cultural views with the future team in advance.
• Time Zones. Another point that you may encounter is local time. Time differences can make things difficult, but if the right measures are taken, this can be avoided. You can immediately discuss the work schedule with the future team and determine a convenient time for them and for yourself.
• The outcome is up to you. In order for the draft to turn out to be of high quality, the customer must clearly understand what he wants to get in the conclusion. To do this, you have to draw up a clear specification and keep an eye on the entire process of work. This responsibility lies with you.

When to choose?

As mentioned earlier, such a team is needed in cases where you urgently and easily need to increase your team or get proper knowledge from specialists in a particular area of work.

Dedicated Team Model

One of the most popular types among it engagement models is a dedicated team. With this collaboration, you will have a command at your disposal to handle the full development. This is very convenient in order to adjust it to the budget of the project. The customer is in charge of the management process, all other responsibility lies with the contractor.

Pros

• Budget savings. You reduce development costs, because with such cooperation you do not lose the quality of the project, but spend less by hiring a dedicated team. You save on equipment, space and other necessary things.
• Process control for the project manager. Another advantage is that the agencies themselves ensure a project manager who controls the entire work process and is responsible for its quality.
• Expertise. If you need help only in a specific area, you may select the appropriate service provider, thereby gaining unique knowledge and skills in the area you need.

Cons

• Possible inaccuracies. The fact is that, as mentioned earlier, agency runners are responsible for control, therefore, in order to get the desired result, you must provide a detailed description of all tasks and processes, as well as explain in detail what you want to receive;
• Ignorance of the language and cultural characteristics. As with the outstaffing model, you may encounter language barter as well as different cultural perspectives. It is quite hard to run people from other locations.
• Declassification of information. Every business has its secrets, strategies and other hidden information. In order for the supplier to create a unique solution for you, he must know as much as possible about you. Therefore, you will have to tell as much as possible about yourself, sometimes including confidential information.

When to choose?

Dedicated team is suitable for long-term projects. Especially such a model of cooperation will be useful for a company that does not have a large number of highly qualified employees in the area needed for development.

Technical Partner

One of the key positions in engagement models in it industry is occupied by a technical partner. The bottom line is that you hire a company with extensive experience, which includes specialists from various fields, including designers, project managers, testers and many others.

Pros

• Effective solutions. Since this is a large and balanced team with a lot of experience, they will easily be able to ensure the best development for the specifics of your business.
• Qualified specialists. You will be able to get access to cool specialists in design, testing, marketing, and other areas.
• Saving time. The contractor is fully responsible for all development processes, so you can focus on more important business processes.

Cons

• Not suitable for short term projects as it is not profitable.

When to choose?

This type of interaction is suitable for huge and long-term projects where a large number of specialists are needed. If your draft is exactly like this, feel free to choose a model.

Type-of-Contract Business Engagement Models

No less popular engagement models in software development are types of cooperation with fixed pricing and time and material. Further in this article, we will get acquainted with their features and characteristics in more detail, as well as find out which one suits you best.

Fixed Price Model

When choosing software engagement models, many prefer the fixed price model. A feature of such cooperation is the setting of a specific budget, as well as the discussion of all the details, namely the timing, scope of work, equipment, and so on. Based on these data, a certain price is built.

Pros

• Proper budget allocation. You know in advance the amount that the project will cost, so you know what to expect and how to manage the budget.
• A clear development implementation process. You will discuss all the stages and necessary work in advance, so the performer will be less likely to make mistakes or shortcomings.
• Saving time. As in some other models, the whole process lies with the performers, so you can more rationally allocate your time and do other important things.

Cons

• Lack of flexibility. If in the end it turns out that there is more work or something needs to be changed because it does not fit, then it will be hard to do this, because the price and all conditions have been discussed.
• Complicated assessment. In order for the performers to correctly evaluate the entire work, they will need time. Therefore, due to the complex assessment, a considerable amount of time is spent to determine the final amount, which makes the process a little longer.
• Regular communication. In order to get the quality development you want, you should communicate with customers regularly. This is sometimes very tiring and takes a lot of time.

When to choose?

Many people prefer the Fixed Price Model over other engagement models in software development due to the fact that it is good for not big projects with a small budget and amount of work.

Time & Material Model

Another type among the many engagement models that deserves attention. The bottom line is that you pay for the work done. How much the developers have done, for that part of the work you pay.

Pros

• Simply to modify. You might easily make any edits and corrections in the course of work, as payment is made for actually completed tasks
• Saving time. You will not fritter away time evaluating various indicators, planning and other things, because everything can be discussed and corrected in the process.
• Availability. You can easily intervene during the process, find out at what phase the development is going on, evaluate the quality and make changes.

Cons

• Difficulties with budgeting. In this model of cooperation, it is difficult to predict what the price will be and calculate the budget.
• Lack of clearly defined deadlines. The amount of work is not really specified before the start of development, so you cannot plan how long the development will take. Although a lot depends on the chosen service providers.
• Full immersion in the project. Since this is a volatile form of cooperation, you will not have to regularly participate in the development and make certain decisions.

When to choose?

Among all engagement models, this one is popular among clients who regularly undergo some changes in their business and its processes.

Conclusion

Summing up, we can say that all engagement models are special in their own way. It’s hard to say which one to select. It all depends on your business, its features and characteristics.

In order not to make a mistake with the choice, carefully study each of the engagement models, examine your business processes and decide which form of cooperation suits you best.

• Versatility. You may quickly customize the process of drafting. You run all the stages related to personnel, so you might quickly set the amount of the team and adapt the number of employees in compliance with your business.
• High level of knowledge. Extensive experience, unique skills and knowledge in your industry – all this you can get from specialists who will cooperate with you.
• Process adjustment. When you hire outstaffing specialists. You are in the complete run of the all process. At any time, you can correct the workflow.

Cons

• Difficulties with communication. Often this model of cooperation involves joint activities with companies from other lands. Therefore, there may be problems with language barter and other features of the culture of the country of developers. It is best to discuss the moment of language and cultural views with the future team in advance.
• Time Zones. Another point that you may encounter is local time. Time differences can make things difficult, but if the right measures are taken, this can be avoided. You can immediately discuss the work schedule with the future team and determine a convenient time for them and for yourself.
• The outcome is up to you. In order for the draft to turn out to be of high quality, the customer must clearly understand what he wants to get in the conclusion. To do this, you have to draw up a clear specification and keep an eye on the entire process of work. This responsibility lies with you.

When to choose?

As mentioned earlier, such a team is needed in cases where you urgently and easily need to increase your team or get proper knowledge from specialists in a particular area of work.

Dedicated Team Model

One of the most popular types among it engagement models is a dedicated team. With this collaboration, you will have a command at your disposal to handle the full development. This is very convenient in order to adjust it to the budget of the project. The customer is in charge of the management process, all other responsibility lies with the contractor.

Pros

• Budget savings. You reduce development costs, because with such cooperation you do not lose the quality of the project, but spend less by hiring a dedicated team. You save on equipment, space and other necessary things.
• Process control for the project manager. Another advantage is that the agencies themselves ensure a project manager who controls the entire work process and is responsible for its quality.
• Expertise. If you need help only in a specific area, you may select the appropriate service provider, thereby gaining unique knowledge and skills in the area you need.

Cons

• Possible inaccuracies. The fact is that, as mentioned earlier, agency runners are responsible for control, therefore, in order to get the desired result, you must provide a detailed description of all tasks and processes, as well as explain in detail what you want to receive;
• Ignorance of the language and cultural characteristics. As with the outstaffing model, you may encounter language barter as well as different cultural perspectives. It is quite hard to run people from other locations.
• Declassification of information. Every business has its secrets, strategies and other hidden information. In order for the supplier to create a unique solution for you, he must know as much as possible about you. Therefore, you will have to tell as much as possible about yourself, sometimes including confidential information.

When to choose?

Dedicated team is suitable for long-term projects. Especially such a model of cooperation will be useful for a company that does not have a large number of highly qualified employees in the area needed for development.

Technical Partner

One of the key positions in engagement models in it industry is occupied by a technical partner. The bottom line is that you hire a company with extensive experience, which includes specialists from various fields, including designers, project managers, testers and many others.

Pros

• Effective solutions. Since this is a large and balanced team with a lot of experience, they will easily be able to ensure the best development for the specifics of your business.
• Qualified specialists. You will be able to get access to cool specialists in design, testing, marketing, and other areas.
• Saving time. The contractor is fully responsible for all development processes, so you can focus on more important business processes.

Cons

• Not suitable for short term projects as it is not profitable.

When to choose?

This type of interaction is suitable for huge and long-term projects where a large number of specialists are needed. If your draft is exactly like this, feel free to choose a model.

Type-of-Contract Business Engagement Models

No less popular engagement models in software development are types of cooperation with fixed pricing and time and material. Further in this article, we will get acquainted with their features and characteristics in more detail, as well as find out which one suits you best.

Fixed Price Model

When choosing software engagement models, many prefer the fixed price model. A feature of such cooperation is the setting of a specific budget, as well as the discussion of all the details, namely the timing, scope of work, equipment, and so on. Based on these data, a certain price is built.

Pros

• Proper budget allocation. You know in advance the amount that the project will cost, so you know what to expect and how to manage the budget.
• A clear development implementation process. You will discuss all the stages and necessary work in advance, so the performer will be less likely to make mistakes or shortcomings.
• Saving time. As in some other models, the whole process lies with the performers, so you can more rationally allocate your time and do other important things.

Cons

• Lack of flexibility. If in the end it turns out that there is more work or something needs to be changed because it does not fit, then it will be hard to do this, because the price and all conditions have been discussed.
• Complicated assessment. In order for the performers to correctly evaluate the entire work, they will need time. Therefore, due to the complex assessment, a considerable amount of time is spent to determine the final amount, which makes the process a little longer.
• Regular communication. In order to get the quality development you want, you should communicate with customers regularly. This is sometimes very tiring and takes a lot of time.

When to choose?

Many people prefer the Fixed Price Model over other engagement models in software development due to the fact that it is good for not big projects with a small budget and amount of work.

Time & Material Model

Another type among the many engagement models that deserves attention. The bottom line is that you pay for the work done. How much the developers have done, for that part of the work you pay.

Pros

• Simply to modify. You might easily make any edits and corrections in the course of work, as payment is made for actually completed tasks
• Saving time. You will not fritter away time evaluating various indicators, planning and other things, because everything can be discussed and corrected in the process.
• Availability. You can easily intervene during the process, find out at what phase the development is going on, evaluate the quality and make changes.

Cons

• Difficulties with budgeting. In this model of cooperation, it is difficult to predict what the price will be and calculate the budget.
• Lack of clearly defined deadlines. The amount of work is not really specified before the start of development, so you cannot plan how long the development will take. Although a lot depends on the chosen service providers.
• Full immersion in the project. Since this is a volatile form of cooperation, you will not have to regularly participate in the development and make certain decisions.

When to choose?

Among all engagement models, this one is popular among clients who regularly undergo some changes in their business and its processes.

Conclusion

Summing up, we can say that all engagement models are special in their own way. It’s hard to say which one to select. It all depends on your business, its features and characteristics.

In order not to make a mistake with the choice, carefully study each of the engagement models, examine your business processes and decide which form of cooperation suits you best.