Remote Developers vs On-site Developers: Which is Right for Your Business in 2024?

The development market is vast and continues to grow, encompassing various industries and technologies. As a result, the global software development market increased from $260.79 billion in 2022 to $334.86 billion in 2023 at a compound annual growth rate (CAGR) of 28.4% and is expected to grow significantly in the coming years.

The demand for software development services is increasing as businesses embrace digital transformation and adopt new technologies such as cloud computing, artificial intelligence, and the Internet of Things. As a result, the web and mobile application development market, in particular, is expected to grow significantly in the coming years.

As technology continues to permeate every aspect of business and society, the demand for software development professionals is expected to remain strong in the coming years. In addition, the trend towards remote work and the increasing need for software solutions to manage remote work has also increased the demand for software development skills.

Before we dwell into what is best for your IT team: on-site or remote work, there are a few questions that you must ask yourself before finding out the pros and cons of a remote team and an on-site team.

Questions to Ask Yourself to Choose the Best Solution

The IT requirements of your business can be better understood by asking the following set of questions:

1. Where is your foundational support system?

Today, a business can choose whether or not to host its infrastructure in-house or in the cloud. In comparison to an on-premises network, cloud computing requires much less upkeep and fewer hardware-related tasks, making it an attractive option. If a hard drive or another component of the network fails, for instance, the data center where the server is located will deal with the issue. Moreover, the hosting service can supply Internet connectivity, uptime guarantees, and more.

With cloud computing, businesses save money by not employing a dedicated server administrator. Many server administrator duties can be carried out digitally and remotely. Similarly, the data center will typically handle any hardware issues remotely.

There are advantages to outsourcing your network, but you should also know that the data center staff will handle any issues that arise due to increased uptime, guaranteed connections, and the like.

2. In whose interests does your team work?

This is an important question as you consider different options for your IT network. For example, will most of your IT team interact with internal (office) clients? If not, then perhaps external customer service is where their attention lies.

Forgotten passwords and account lockouts are common cases requiring assistance from internal services. Furthermore, they may assist with onboarding services and handling other minor issues.

An external help desk, on the other hand, collaborates with customers outside of the company (who could be customers). Similar to internal issues, the problems can come from without (forgotten passwords, for example).

If your IT department's primary focus is on internal matters, you may not need a dedicated team. One person can take charge of resolving any internal issues. However, a remote IT team may be preferable if employees deal primarily with customers. Remote customers can reach the support team via email, chat, or phone and get answers fast.

Organizations dealing with internal and external IT issues may benefit from establishing either a hybrid workforce (consisting of both an on-site and remote team) or a dedicated onsite department.

3. Should you get custom development for your company?

any?

IT services extend far beyond password resets and broken hardware for some businesses. Potentially, they need to be improved constantly. Some industries, for instance, may require a company to have an IT employee monitor and audit processes and apps to ensure compliance with regulations. Furthermore, a business might face several situations that call for special programming.

Using a remote engineering team presents its own set of difficulties when a company needs constant innovation. Among the numerous challenges associated with remote work is the problem of fostering team spirit and performing specialized IT tasks.

Companies that need constant improvement may benefit more from hiring an on-site development team. IT staff members can collaborate and other departments. Cooperation and friendships are much simpler to cultivate under those conditions.

Your decision to hire an on-site or remote engineering team is essential to the direction the market is taking.

Where's The World Heading?

We all know that since Covid-19, the world has shifted to remote working. But to emphasize our point further, let's have a look at these intriguing statistics:

• A survey conducted by Upwork states that due to COVID-19, 61.9% of companies are planning more remote work now and in the coming years. It's worth noting that remote workers now save 40 minutes per day on average on transportation costs due to the pandemic. In 2022, 16% of companies worldwide were 100% remote, and 44% didn't allow remote work.

• Just after the COVID-19 pandemic, 76% of IT employees in the United States began working from home in May 2020, according to The Economist. This is a significant increase from before the pandemic, demonstrating the growing flexibility and convenience of remote work for software engineers.

• According to a study by DigitalOcean, 86% of IT developers work remotely, with nearly a third working from home full-time.

• According to Global Workplace Analytics, employers can save over $11,000 a year per employee in a remote work model due to lower cost of office space, more productivity, less absenteeism, and reduced turnover. 

What is an on-site development team?

On-site development refers to software development at a physical location, typically within the company's offices. In an on-site development environment, the software developers work near one another. As a result, they can collaborate and communicate directly with other members of the team, as well as with other departments within the company.

On-site development is often seen as the traditional model for software development and has been the norm for many years. However, in recent years, the trend has been moving towards greater flexibility as technology has advanced, and companies have embraced the benefits of having a hybrid or solution.

That being said, some industries, such as finance and healthcare, may still require on-site development for security reasons. One of the biggest obstacles to in-house software development is the shortage of skilled tech talent. While this shortage isn't new — in 2009, over 50% of CEOs were already worried about the lack of tech workers — the accelerated digital transformation spurred by the pandemic has widened the gap.

Here are some pros and cons of an on site team:

Pros of on-site development team:

1. Better collaboration and communication

On-site teams allow for face-to-face communication, leading to improved collaboration, faster problem-solving, and increased productivity. They can have in-person conversations, which are often more effective and efficient than remote communication. Face-to-face interactions allow team members to read each other's body language and non-verbal cues, which can help convey meaning and build understanding.

According to the Connected culture report, 71% of those employees who said they were more productive, feel well-connected to their colleagues. So, employees who regularly communicate with one another are more effective. 

Moreover, a company that lacks communication can suffer, as indicated below:

2. Increased accountability

When team members are physically present, there is a heightened sense of accountability for completing tasks and meeting deadlines. In addition, they are more likely to be transparent about their work and progress, as they work in an environment where they can be easily observed. Moreover, hiring managers and supervisors have a more direct line of sight to work being done and can more easily monitor progress and provide feedback.

3. Improved company culture

Having an on-site team can help build company culture, create a stronger sense of community, and foster a more positive work environment. Adding a healthy dose of competition to the workplace has increased morale and output. Workplace morale can be boosted when employees receive encouragement from their coworkers. When employees regularly meet, they have an increased commitment to the workplace and colleagues, which may result in a greater retention rate for the company.

4. Exposure to training and development

On-site teams have more opportunities for in-person training, workshops, and team-building activities, which can lead to better professional development. Moreover, they have better chances to demonstrate their skills and prove their value to the company, which can lead to promotions and advancement.

5. More control

You'll have more say in the outcome of the development process if you use an in-house team. As a leader, you are always aware of the tasks being completed by each team member. In addition, having control over the development process in-house makes it simpler to enforce strict quality assurance guidelines, such as protecting sensitive information.

Cons of an on-site development team:

1. Limited geographic flexibility

On-site teams are limited to working in a specific geographic location, which can disadvantage employees who prefer to work remotely or in a different location.

2. Higher costs

It's undoubtedly a significant drawback that it has a lot of costs attached to it, such as rent for office space, utilities, and other expenses associated with maintaining a physical location. Moreover, it's expensive for employees to commute to the workplace, considering the global inflation rate.

3. Reduced talent pool

On-site teams may have a reduced pool of talent to draw from, as not all potential employees may be willing or able to work in a specific location.

What is a remote development team?

What is a remote development team?

A remote development team is a team of software developers, designers, and other IT professionals who work from remote locations rather than a central office or on-site location. Remote development teams use video conferencing, collaboration software, and other tools to communicate and collaborate with their clients. The team members can be located in different cities, states, or even countries, but they are all connected virtually to work on a joint project.

Pros of a remote development team:

1. Cost-effectiveness

Outsourcing can save you a lot of money because you only pay for the service and don't have to worry about hiring new people or providing them with benefits. Payroll costs, including insurance and benefits, are not your responsibility. Companies specializing in software development will cover these costs for their employees, while independent programmers will pay for them themselves. Most businesses value outsourcing because of the savings they can realize it.

Do check out our blog on cost-effective tips for hiring remote developers.

2. Quicker responses

Firms or individuals specializing in software development are accustomed to jumping right in on day one. There will be no wasted time as you put together a team and teach them to follow procedures and policies established by your business. Developers who offer professional services will have streamlined processes they regularly use to meet deadlines. If your internal team is an experienced DevOps unit, they may be able to complete the project more quickly. However, if this is your first project, you are better off outsourcing.

3. Streamlined operations

If you outsource, you won't have to create something from scratch. A professional firm will have dealt with these issues while working on other projects and likely has established procedures, but you will still need to provide a brief and explain precisely what you're looking for.

4. Scalability

Outsourcing is a simple method of scaling up for situations where you must rapidly release multiple projects. You can hire a hundred companies and start several separate tasks simultaneously if you have enough money. Even if you don't need massive expansion, outsourcing lets you keep various highly specialized projects active simultaneously.

5. Long-term commitment

When building your team, you must allocate significant resources to their initial orientation and ongoing development. If you only need a simple app or won't require constant maintenance and updates, you may not want to make this investment. When you outsource, your involvement is temporary and restricted to a specific project. A long-term commitment may not be necessary for speculative projects, or you may want to test the waters with a trial version of your software to see how it is received before committing fully.

Cons of a remote development team:

1. Managing remote workers

Managers may find it more difficult to manage remote workers, as they lack the benefit of face-to-face interaction and may have more difficulty monitoring their performance.

Check out how to manage remote developers here.

2. Communication difficulties

Due to time zones, language barriers, and other communication challenges, remote teams may have more difficulties communicating and collaborating effectively.

3. Technical challenges

Remote teams may experience technical challenges, such as unreliable internet connections, software compatibility issues, and other technical problems that can impact the team's ability to work effectively.

Moreover, suppose you're looking to hire a remote team of top-vetted software engineers. In that case, you should consider Remotebase, as it doesn't only hire the top 1% of talent for you but allows you to build a remote team that you can confide in for scaling up your tech business. Additionally, it offers a free 2-week trial with no upfront charges, so it's a win-win!

So, have you made a decision yet? If not, that's okay. You can check our in-depth guide on whether hiring remote developers is worth it in 2023.

Bottom Line

It's worth noting that both on-site and remote work arrangements have pros and cons. The best option for a company will depend on various factors, such as the type of work being done, the company culture, and the needs of individual employees.

In recent years, there has been a growing recognition of the benefits of remote work. As a result, many companies are now offering hybrid models that allow employees to split their time between on-site and remote work. This can offer the best of both worlds, providing the benefits of direct collaboration and control while allowing for remote work's flexibility and cost savings.

Ultimately, the best approach will depend on each company's specific needs and requirements. For example, some companies may prefer on-site developers, while others may find remote developers a better fit. Finally, some companies may adopt a hybrid model that allows for both on-site and remote work, depending on the needs of each project.

Frequently Asked Questions

What is an on-site software development model?

The onshore/on-site software development model is a software development approach where the development team works physically at the client's location to deliver a project. This model allows for close collaboration and direct interaction between the client and the development team.

Is remote work a competitive advantage?

It's possible to hire from anywhere in the world, and this is perhaps the most significant benefit of remote work. However, to what extent a startup is successful depends mainly on how well it can assemble and keep together its core team. As a result, fierce competition exists among businesses for the best available employees.

Is it better to work remotely?

Although the employee is the primary focus for the benefits of remote work, the company also stands to gain a lot. Improvements in retention, brand recognition, communication, employee morale, and output are just a few.

Hire Top 1% Remote Developers in 24 Hours with Remotebase