In-House Development: The Pros And Cons

The definition of in-house developer has shifted over time given the wave of remote work. You can now be separated by thousands of miles from the home office but still be an in-house engineer.

Even amid the growth of remote work, in-house development still stands as the conventional model of building out a development team. But any business owner starting out or looking to expand should consider the pros and cons of in-house development.

So, what is in-house development? Simply put, it’s when you are building out an internal software development team. This means that you are hiring full-time employees for your company rather than a contractor.

To put it another way, you’re working with a W-2, not a 1099. And the result of that hiring in-house includes everything from managing the recruitment process to payroll to HR.

(For a look at the flipside of  in-house development, see our analysis of software outsourcing here.)

Benefits of a full in-house development team:

Hiring your entire development team in-house is arguably the most common method of building a software development team that exists. In doing so, you’re going to enjoy the many benefits that an in-house development team will bring you.

Control

When hiring an in-house development team, you inherently gather more control over your team and their roadmap. These individuals are your direct hires, so they are guided by your command. You own the process of onboarding these developers and of teaching them the processes and philosophies you want them to follow. As full-time members, they start to learn the organization more thoroughly, making them efficient employees who can more eloquently adapt to the needs of the company.

Communication

Communication can be one of the hardest facets of managing developers. As your in-house team, you can communicate directly with the developers themselves rather than having to interface with an intermediary. This layer of direct communication can help reduce ambiguity and miscommunication.

Consistency

When you hire an in-house team, you’re hiring a team that you hope will grow with you as a company. This means you have consistency in talent. You’re investing in the future, not just the instant gratification of building a product. In maintaining your development team, you are building domain expertise that becomes incredibly valuable to your product roadmap, a positioning that isn’t always gathered when just contracting temporary developers.


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Drawbacks of a full in-house development team:

While hiring in-house developers offers many advantages, it also has some drawbacks that position it as a risk that each company must weigh. There are three main negative aspects to consider before determining to hire an in-house team.

Bandwidth limitation

While it’s wonderful that your developer on your team is dedicated to your team, you must also consider that you are limited to their knowledge and bandwidth. If you need some quick work in a different technology, you can’t pull from other resources like you could when outsourcing; you’re stuck with your team, so you are bound to their limitations.

Time intensity

It takes a long time to hire the right person. In some instances it can happen in weeks, but in others it can take months. You have to source the right candidate, put them through an interview process, and then if you decide to hire them, you must spend at least a month onboarding them and ramping them up to speed. All in all, it is a very time-intensive endeavor as compared with the speed of outsourcing.

High costs

As we all know, time is money. When something takes a long time, that means it costs a lot. Hiring a developer in-house is not only more expensive from the salary point of view, but also from the process perspective. You should expect to pay an in-house hire at a multiple of what you could otherwise hire for when outsourcing. You also must consider the amount overhead it will be in managing this in-house developer and factor that into your cost projections.

So, how do I get started?

If you’re hiring in-house, take a look at sites like BuiltIn to post your job. BuiltIn is an amazing website that highlights tech jobs. You tend to get great candidates through BuiltIn’s network and reach. You should also heavily lean on your own networks, such as LinkedIn, as well as personal connections who are familiar with your job needs and have a community they can connect you with.

Whatever route you go, be sure you’re ready with the proper hiring infrastructure to onboard your new developers as well as the proper benefits system to retain them as your employees.

Not sure if in-house hiring is right for you? Check out our thoughts on outsourcing your software development, either entirely or by supplementing your in-house team.

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