Outsourcing software development? You’ve got options; project-based teams, staff augmentation or a dedicated development team. But how do you know which one is right for your business? In this post, we’ll explain what a dedicated team model is, its pros and cons, how it compares to other outsourcing models, cost considerations, and when it’s the right fit. Read on for all the details!
What is a dedicated development team model?
A dedicated development team is exactly what it sounds like – a team of developers, designers, and other technical experts who work exclusively on your project, just like an in-house team but without the hassle of hiring and managing them yourself.
Unlike other outsourcing models where resources are shared across multiple clients, a dedicated team is fully committed to your product, ensuring better focus, consistency, and quality.
Plus, you get the flexibility to scale the team up or down as your project evolves, making it a great option for businesses that need long-term collaboration without the overhead of full-time hires.
Dedicated development team structure
The structure of a dedicated development team can vary depending on your project scope and business needs, but there are some core roles you’ll find in most teams:
- Project manager
- Business analyst
- UI/UX designer
- Developers (front-end, back-end, full-stack, mobile, etc.)
- QA engineer
- DevOps engineer
If you want a deeper dive into what these professionals do and how they contribute, check out our detailed guide: Dedicated Software Development Team Structure: The Roles and Responsibilities You Can Outsource
Dedicated development team vs. other outsourcing models
When it comes to outsourcing, you have got different options to engage development resources. To help you decide, we’ll break down how the dedicated team model compares to three common alternatives: fixed price, time and materials (T&M), and staff augmentation.
Fixed price model
A fixed price model is a collaboration approach where the client and the outsourcing company agree on a set price for the entire project before development begins. The budget, scope, timeline, and deliverables are all predetermined.
It’s best suited for:
- Small, well-defined projects
- MVPs with minimal features
- Simple websites or apps with predefined scope
The main drawback of the fixed price model is its lack of flexibility. Since the budget, scope, and timeline are predetermined, any changes or unforeseen challenges can lead to delays and additional costs.
Unlike the fixed price model, a dedicated team offers full flexibility for changes and continuous development, making it ideal for long-term projects. However, it usually involves a higher cost compared to the fixed price approach.
Another key difference is your level of involvement. With fixed-price projects, you typically have less direct engagement with the engineering team, and a project manager acts as your main point of contact.
But with a dedicated team, your active participation is crucial; you define the vision and requirements while the development team focuses on bringing your product to life.
Time and materials (T&M) model
The time and materials model is a flexible approach where you pay for the actual time developers spend on your project and the resources used. There’s no fixed cost upfront, making it ideal for projects with evolving requirements, as you can adjust the scope and priorities as needed.
This collaboration model works for:
- Projects with unclear or changing requirements
- Long-term development with ongoing updates
- Prototyping and experimental software
The main drawback? Costs can be unpredictable. Since you’re paying for time and effort, the final price depends on how long development takes, which may exceed initial estimates.
Plus, T&M doesn’t guarantee that you’ll work with the same team throughout the project – developers may be assigned based on availability, which can affect consistency.
Compared to T&M, a dedicated development team provides not just flexibility but also stability. With a dedicated team, you get an exclusive group of professionals fully committed to your project from start to finish, ensuring better collaboration and deeper product knowledge.
Staff augmentation
The IT staff augmentation model lets you temporarily extend your in-house team by hiring external developers on a contract basis. This is a great way to fill skill gaps without long-term hiring commitments, giving you access to specialised talent when needed while keeping full control over the project.
This model is ideal for:
- Scaling an in-house team quickly
- Short-term projects requiring specific expertise
- Companies with existing internal management and processes
With this approach, you get more responsibility on your end. While you get additional developers, you still have to manage them, assign tasks, and ensure smooth collaboration. Plus, integrating external team members with your internal workflows can take time and effort.
A dedicated development team, on the other hand, offers a more hands-off approach. Instead of just hiring extra resources, you get a fully managed team that handles the entire development process. This means less time spent on day-to-day management and more focus on your core business.
Here’s a comparison table highlighting the key differences between dedicated team vs. other outsourcing models discussed above.
| Feature | Dedicated Team | Fixed Price | Time & Materials (T&M) | Staff Augmentation |
| Pricing | Monthly/hourly rate per team member | Fixed total price | Hourly/daily rate based on actual work | Hourly/daily rate per staff member |
| Risk | Shared; client has more control | Vendor bears most risk | Vendor bears most risk | Client bears most risk |
| Control | High; direct management of team | Limited; managed by vendor | Moderate; client monitors progress | High; direct management of staff |
| Flexibility | High; adapts to changing needs | Low; limited to defined scope | High; adapts to changing needs | Moderate; adapts to changing needs within staff’s skill set |
| Team composition | Dedicated, full-time team | Vendor-selected team | Variable, based on needs | Individual specialists integrated into existing team |
| Project management | Client or vendor depending on contract. | Vendor | Client or vendor depending on contract. | Client |
| Suitable for | Long-term, evolving projects | Small, well-defined projects | Projects with changing requirements | Filling skill gaps in an existing team |
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When a dedicated development team is the right choice?
Let’s go over five key scenarios where a dedicated team approach is the ideal choice.
Startup growth phase
Startups often don’t have the time or resources to build an in-house team from scratch, and hiring freelancers for every development task can slow things down. With a dedicated team, you get a group of experienced developers who work exclusively on your product, helping you build, test, and refine features at speed.
This allows you to quickly adapt to market feedback and roll out updates faster; all while keeping your focus on funding, marketing, and scaling your business. Instead of worrying about hiring and managing developers, you have a ready-to-go team that acts as an extension of your startup, ensuring smooth product growth without delays.
Expensive in-house hiring
If hiring an in-house development team is too expensive due to the overhead costs of full-time employees like salaries, benefits, office space, and equipment, a dedicated development team offers a cost-effective alternative without compromising on commitment or quality.
Building an internal team requires significant time and financial investment, especially if you need specialised talent that’s hard to find locally. With a dedicated team, you get highly skilled professionals at a lower cost, often from regions with more competitive rates, without dealing with the complexities of recruitment and HR. Plus, you only pay for the expertise you need, when you need it, making it a scalable and budget-friendly solution.
Long-term projects
If you’re working on a long-term project that requires continuous development, updates, and scaling, a dedicated development team is the way to go. This model is perfect for complex software that isn’t built in a few months but evolves over time; think SaaS platforms, enterprise systems, or large-scale applications.
With a dedicated team, you have a stable group of developers who deeply understand your product, ensuring consistency and efficiency as new features are added and improvements are made. Plus, as your project grows, you can easily scale the team up or down without the hassle of hiring and onboarding new people every few months.
Evolving requirements
If your project scope is unclear or you know it will change frequently, a dedicated development team is the best choice. Many software projects start with a rough idea that evolves based on user feedback, market trends, or new business needs.
In a rigid outsourcing model, making changes mid-way can be expensive and time-consuming. But with a dedicated team, you have the flexibility to adjust priorities, experiment with new features, and refine your product as it develops. This is especially useful for startups or projects where learning and adapting are key to success.
Multiple ongoing projects
Managing several projects – whether it’s maintaining an existing product, developing a new app, or handling internal tools – requires a reliable and skilled team that understands your business and can seamlessly switch between tasks.
Instead of constantly hiring freelancers or working with different agencies for each project, a dedicated team gives you a stable, long-term resource to handle all your development needs under one roof. This ensures better consistency, faster execution, and smoother collaboration across projects.
When NOT to choose a dedicated development team
While the dedicated development team model comes with plenty of advantages, it’s not always the best fit for every project. In some cases, other outsourcing models might be more practical and cost-effective. Here are three situations where hiring a dedicated team might not be the best option.
Short-term or one-time projects
If your project is short-term, has a fixed scope, timeline, and budget, then a dedicated development team is not the most cost-effective option. Hiring a team for an extended period makes sense for long-term projects, but if you’re building a one-time product, an MVP with minimal features, or a small website or app, a fixed price model is a better fit. With a fixed price approach, you get a clear estimate upfront, with a predefined set of deliverables, making it easier to manage costs and expectations.
Limited budget
The dedicated team model involves ongoing payments for a full team over an extended period, it requires a steady financial commitment. If you’re working with a tight budget and can’t sustain the cost of a long-term team or you only need development help for a specific task, a more budget-friendly approach like the time & materials (T&M) model or IT staff augmentation might be a better fit. These models let you pay only for the hours worked or hire specific talent temporarily, keeping costs more manageable while still getting the development support you need.
Lack of internal management
If you don’t have the time or expertise to manage a remote team, a dedicated development team might not be the right fit. While the team handles development, you still need to provide direction, define priorities, and stay involved in decision-making. If you prefer a hands-off approach or lack internal management resources, a fully managed outsourcing model would be a better choice. With this approach, a project manager oversees everything from planning to execution, ensuring smooth delivery without requiring your constant involvement.
How much does it cost to hire a dedicated development team?
Figuring out the cost of hiring a dedicated development team can be tricky because there’s no one-size-fits-all price. The total investment depends on several factors, including team size, location, level of expertise, and the scope and duration of your project.
The pricing model for a dedicated team is straightforward – each team member has an hourly rate, and you pay for the actual hours worked.
One major factor that affects cost is the location of your dedicated development team. Developers in the US and UK typically charge higher hourly rates compared to specialists in Eastern Europe or Asia, where you can find equally skilled professionals at a more competitive price.
After researching platforms like Clutch, Upwork and Payscale, we’ve prepared a general overview of average hourly rates (in USD) of dedicated specialists in the US, UK, Poland, Ukraine and Pakistan.
For example, let’s say you want to hire a dedicated development team in Pakistan for a 6-month project with the following team structure:
- 1 Project Manager
- 1 UI/UX Designer
- 2 Software Developers
- 1 QA Engineer
Assuming a 40-hour workweek, the total cost at local market rates would be around $139,200.
Note: This is an estimate based on average rates. Actual costs may vary. Factors like specific skill sets and experience levels can influence the final price. It is always best to get a detailed quote from the company providing the services.
Why choose GoodCore Software’s dedicated development team services
At GoodCore Software, we have extensive experience working with clients in a dedicated development team model. In fact, 20% of our projects run on this model, helping businesses build high-quality software with long-term collaboration and flexibility. Here’s what you get collaborating with us:
Hire dedicated specialists fast
We have a pool of highly skilled software engineers and product experts proficient in all major platforms and technologies. No need to go through lengthy recruitment processes, we bring the right talent to your project quickly and efficiently.
Get your team up and running in no time
Our dedicated teams can be ready to kick off in just 1-2 weeks, ensuring minimal delays and a smooth onboarding process. We handle the setup, so you can focus on your product.
Scale your team as needed
Your project needs may change, and that’s okay! Whether you need to expand your team with more developers or scale down, we offer the flexibility to adjust resources on demand without the hassle of hiring or layoffs.
Maximise value without overspending
With operations in the UK, Pakistan, and Malaysia, we provide access to top-tier global talent at highly competitive rates. You get the same high-quality development expertise without the high costs of hiring in expensive markets.
Choose how you collaborate
Prefer direct interaction with your team? Or want a project manager as your single point of contact? We offer flexible engagement options so you can work the way that suits you best – no rigid processes, just what works for you.
You may also want to check out our article: How to Hire A Dedicated Software Development Team
Want a reliable, skilled team to execute your project?
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FAQs
What are the benefits of hiring a dedicated development team?
Hiring a dedicated development team gives you long-term commitment, flexibility, and access to top tech talent without the overhead of in-house hiring. You get a team that fully understands your project, adapts to evolving requirements, and ensures faster development. Plus, it’s a cost-effective solution compared to hiring full-time employees in high-cost regions.
Where to build a dedicated development team?
You can build a dedicated development team in popular outsourcing regions like Eastern Europe, Latin America (LATAM), and Asia, which have large pools of highly skilled IT specialists. Eastern Europe (e.g., Poland, Ukraine) and LATAM (e.g., Brazil, Argentina) offer technical expertise at mid-range costs, while Asia (e.g., India, Pakistan, Vietnam) is the most cost-effective option without compromising quality.
What legal aspects should I consider when hiring a dedicated development team?
When hiring a dedicated development team, consider key legal aspects like intellectual property (IP) rights, ensuring your business owns all code and deliverables. Sign non-disclosure agreements (NDAs) to protect sensitive information and a clear service contract outlining payment terms, responsibilities, and dispute resolution.
Can I scale a dedicated development team up or down?
Yes! A dedicated development team offers full flexibility, allowing you to scale up or down based on your project’s needs. You can add developers, designers, or QA engineers as your workload increases or reduce the team size if requirements change. This ensures cost efficiency and agility without long-term hiring commitments.
What are the challenges and disadvantages of a dedicated development team?
Some challenges of a dedicated development team include the need for active management, potential time zone differences, and higher costs compared to short-term outsourcing. However, with the right tools and processes, these challenges can be minimised for a smooth collaboration.
