The IT market is so diverse and fast-growing. Moreover, you need some time to understand it. We spend a fair amount of time researching IT market analyzing and systematizing our insights.
We have collected the most valuable data concerning Information Technology environment and would like to share it with you.
Classification of Project Teams
After seeing what Upwork, Clutch, Freelancer, Blurgroup, Crew, TopTal, Guru, Topcoder offer plus looking at TOP-100 companies in the world, the local rankings as well, we have divided IT contractors into groups depending on the approach. We focused on companies that operate in the range from the lowest up to $ 2 million budgets for the project. In our survey, we didn't consider the largest companies that do projects at the level of $ 10 million and higher. This is an entirely different market.
So, here's what we got:
- Freelancer or a team of 3-4 people. Approach: "make this button on this page for $ 50." What they sell: the performance of a specific task.
- A small web studio / small IT outsourcer. Approach: "Do what the customer said." What they sell: qualified execution of a small project under the management of the client as a leader.
- A small specialized agency / small specialized IT outsourcer. Approach: "development or promotion." The customer initiates all ideas and management activity.
- Project team or outsourcer with extensive technical experience. Approach: "study of the customer's idea, development, and implementation of the project at a high level."
- A large project or an outsourcing company. Approach: "the client expresses the idea, then the development team implements on a primarily large scale at the global level."
However, there are companies which couldn't fit any parameters provided below, but we want to describe them as well.
These are highly specialized (niche) businesses that implement a single product of one version. "Team geniuses" is substantially similar to a small studio with a highly professional team. However, the company is difficult to determine by the formal characteristics. It's not included in the typical list of teams that provide exclusive services for outstaffing (hiring remote personnel). Moreover, we did not include digital agencies, as they do too much. For them, the development is a part of the project. So that is outsourced.
Are IT Contractors Different?
We compared the approaches using 6 parameters: the number of people in the team (understanding how large the potential project could be): the support and guarantees provided; the customers a company usually works with; the style of work and creative tasks, the level of documentation and management style.
Freelancer or Freelance Team: Amateur Level
- Staff: from 1 to 3-4 people
- Support: no support / no guarantees
- Types of customers: piece-work - short-term relationships, made-paid-earned-gone
- Creativity and style of work: "piecework" mode - is responsible only for a clear scope of work, which the freelancer knows 90% and can guarantee the result
- Documentation: no project documentation, task history (tracking system), testings (Quality Assurance)
- Management: the terms are traditionally not maintained, edits are not controlled, the work is conducted "to the victorious"
- Project budget:
- <1000 $ - freelancer - a small page, a template site
- <5000 $ - freelancer or a team of freelancers - finalization of the ready, template solutions
When is it a good option? If you need to fix a problem that is cheaper to outsource than to bother your developer.
Little Studio: Scheme Work
- Staff: usually 5-12 people
- Support: in 95% of cases, support is provided only within 1 month after the project delivery
- Types of customers: rarely get "long-playing" customers: the project work "did-run-paid"
- Creativity: don’t think about the idea, don’t offer any improvements at the level of business processes
- Style of work: they work exclusively on ready-made patterns: there is no custom development, only ready-made solutions
- Documentation: TK is done, but by the middle of the project it has been no longer followed, as a result, after the launch, there is no management. There is no dedicated project manager, everything is done by the many-armed Shiva - the owner of the studio a la senior developer
- Project budget:
- <5000 $ - finalization of the ready, template solutions
- 5000 $ -10 000 $ - solutions based on ready assemblies
When is it a good option? If you want to develop a template solution on a finished platform without custom development.
A Small Specialized Agency / IT-Outsourcer: a Reliable Developer of Understandable Solutions
- Staff: usually 15-25 people, but there are companies with even a smaller staff
- Support: there is, but the quality of all companies is different. There are companies of this scale that specialize specifically in supporting
- Types of customers: 1-2 projects, beyond this volume, their customers' needs aren’t met
- Creativity: very low level meaning "in our experience, there is no need ..."
- Style of work: perform reliable development of turnkey projects, a full cycle from requirements development (SRS) to testing (QA) and support after the launch + development in the short term
- Documentation: conducted + \ - diligently, but its quality depends on the company
- Management: a dedicated project manager (not always highly qualified), often with the active assistance of the owner of the agency
- Project budgets:
- 10 000 $ -50 000 $ - reliable development of the full cycle (both implementation of ready-made solutions and custom development)
When is it a good option? If you need reliable development with technical consulting, but without interference in business logic and the project itself is not huge and can be performed on the technologies on which the company specializes.
Project Team or Outsourcer with a Wide Technical Stack
- Staff: depends on the scale of the business, ranging from 25 people, but mostly 40-85 people
- Support: subscribe for a long period, flow into the development of the project
- Types of customers: medium-sized businesses that require the development of complex online services (mail dispatchers, portals, large stores)
- Creativity: basically at a technical level, not in terms of design or elaboration of a business idea
- Style of work: very clever and experienced "hands" of development, a large team with a full set of specialists, following methodology (often agile), responsibility for the product lies on the client, for other parts of the product - on the team
- Documentation: world standards
- Management: dedicated PM + BA (business analyst) dealing with customer requirements
- Project budgets:
- 50 000 $ -500 000 $ - a new online product or serious introduction
When is it a good option? An entrepreneur or business manages a sufficient budget, there is a clear business idea and business logic that requires serious scalable solutions, but there is no time or to study and understand all the details of the development.
Large Outsourcing Supplier: Custom Solutions for Large Business Solutions
- Staff: more than 100 people
- Support: all inclusive (contracts for fixed amounts in millions of dollars and for 5-10 years), while the client works as a business development manager
- Types of customers: large enterprises (banks, logistics, insurance, enterprises, large-scale trade)
- Creativity: offset in user-defined dev and value dev (CRM-, ERP-systems, that is, Enterprise-solutions)
- Style of work: a full cycle of creating custom solutions for large enterprises with professional implementation in place and further support (not reused)
- Documentation: according to the world standards, according to the project of the chosen business analyst and quality engineer
- Management: PMP managers (project management specialists), product owners on the client side
- Project budgets:
- 500 000 $ -2 000 000 $ and above - individual systems for large business / large online services. This is an average range, internal systems usually cost from $ 1,000,000 depending on the complexity of the project.
When is it a good option? Big money + non-standard business processes inside the company = large-scale custom solutions
Which Team is Better to Choose?
Select the ratio between the difficulty level of the task and the available budget. If you only have an idea, you do not need to go to the first three teams. At once it is necessary to begin competition among medium and large developers. If you have a design specification + prototype + your project manager, you can choose a command of type 2 or 3. The first type is suitable for small tasks. The chance to find a good freelancer is small, but they are on stock exchanges, it all depends on the personal qualities of the performer.
What is The Type of Evergreen?
In our approach, we combine the main advantages of type 3: we are a small team that performs projects qualitatively, but we see our involvement in developing mode, and we have quite a diverse technical experience - we do not specialize in any technology. We specialize in taking together with the client his idea and growing from it a successful online project. This is our value and our passion.
Evergreen is a project team that starts with the idea and works out technical requirements, chooses an implementation variant from a wide stack of available technologies.
The images used in this article are taken from open sources and are used as illustrations.