Outsourcing vs. Outstaffing: What is the difference and what to choose?

Jul 1, 2022 3 min read


Outsourcing and outstaffing are two ways to get work done. It’s important to understand the differences between them so you can make an informed decision about how best to use them at your company.

What is outsourcing?

Outsourcing is the practice of contracting a third-party vendor to provide services that would normally be performed by a company's own employees. For example, if you want to hire a web developer but don't have any in-house resources for creating your website, you could outsource the development of your site to an external firm.

Outsourcing is popular because it allows companies to focus on their core competencies while outsourcing low value tasks to other firms at lower costs than hiring internal employees. Outsourcing can also lead companies to focus more on new innovations rather than repetitive tasks that they don’t need but still need done in order for their business model to work smoothly (i.e., manufacturing or customer service)

consider the following scenario: You’ve decided to start up your own online business. First, you’ll need a website and some marketing materials. To build these out, you could either hire an in-house team of web developers or go with an outsourced company. The former option might be more costly upfront but will save money over time by providing long-term employment benefits such as paid time off and health insurance.

Benefits of outsourcing

Here are some of the advantages of outsourcing:

Access to a greater pool of talent. Typically, you will be able to hire experienced, qualified candidates who have the skills and experience that you are looking for.

Reduced costs. By using a third-party company, you can reduce your costs by not having to hire an employee or pay them benefits or insurance premiums.

Reduced risk. When hiring employees directly, there is a certain level of risk involved when it comes to hiring an employee who may not suit the job requirements or who may end up leaving after only being with your company for short period time (this can be especially problematic if they pass on confidential information). Hiring through a third-party company ensures that they will provide adequate vetting and selection procedures before placing someone on your team so that this type of problem doesn’t occur as often as it would if you were directly hiring someone yourself

What is outstaffing?

Outstaffing is a form of outsourcing that will help your business accomplish more with less. It’s a way to bring in experts who will work on your project, and you don’t have to worry about managing them or making sure they are following through with their tasks. But at the end of the day, it’s still outsourcing so it doesn't come free; you'll have to pay for these services.

If you find yourself needing more work done than your staff can handle, then outstaffing may be a good solution for you. You might not even have enough workers on hand yet! In this case, outstaffing allows you to hire people from other companies who are experts in their fields but lack their own company infrastructure (like HR). This means that if something goes wrong during an outstaffed project or there's some kind of dispute over payment between employer and employee--it's someone else's problem!

Benefits of outstaffing

Outstaffing is a win-win model with less risk and more flexibility. The outstaffing model allows you to outsource only the services that are necessary without losing control, while allowing your teams to keep focus on what they do best. You will also enjoy reduced costs, since the process is more efficient and accurate than outsourcing or going through an agency.

Outstaffing is not a one-size-fits-all model but rather works with each client individually to find solutions that work best for them in terms of project size, budget, team size and location (near or far). You can choose how many resources you want at any given time based on your needs—and if those needs change over time then it’s easy to adjust them instead of having someone else decide for you!

With outsourcing there isn’t much room for change because once an employee leaves their job there’s no way back into their old role unless they agree beforehand not to take up another position elsewhere until some specified period has elapsed; otherwise this could be considered as unfair dismissal due to breach of contract which could result in legal action against both parties involved."

Currently, only outstaffing is the truly win-win option for an IT company and a client.

Outsourcing is a great option for companies that want to focus on their core business. If you’re not sure whether you should outsource or outstaff, ask yourself:

How much time am I willing to spend managing the outsourced team?

What resources do I have at my disposal?


In general, outsourcing is a good alternative if your business needs flexible and cost-effective IT support. On the other hand, outstaffing is better suited for companies that want to keep their current employees but save costs on new hires by outsourcing some tasks to remote workers. In both cases, you may need some help from an outstaffing agency or freelancer to find qualified candidates who will work with you on projects such as

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