BOT vs Staff Augmentation
Phoenix, AZ, December 06, 2021 –DIGITANITY. The global IT outsourcing market was valued at $333.7 billion in 2019, and it is expected to reach $397.6 billion by 2025. In addition, economies are gradually recovering from the Covid 19 pandemic. As a result, a new trend is emerging where companies prefer and are ready to explore a Build Operate Transfer model over staff augmentation services.
What is Build Operate Transfer Model?
Build Operate Transfer model is a method in which companies engage in developing infrastructure projects in developing countries. The private sector company will invest in the project by building, managing it for 20 to 30 years before transferring it to the government. The advantage is that the company can recoup its investment during this time frame and make profits much higher than it would have in developed countries.
However, nowadays, IT companies are adopting the BOT model to establish new markets. The Build Operate Transfer (BOT) model was initially used in developed countries, but it is also gaining popularity in the developing world.
Staff Augmentation Services
Staff augmentation is a business model where the third-party company provides professionals to companies looking to outsource some of their work on a short-term basis.
The primary advantage for companies using staff augmentation is that they do not need to pay benefits or incentives to the employees. Instead, the staffing company pays these. Companies also save money on office space and infrastructure for the staff.
However, companies using staff augmentation services are restricted in terms of their technology choices. Furthermore, because there might be limits to the maximum time a company can keep an employee, there is no incentive for employees to build long-term relationships with clients or companies.
Also, it can be challenging to get outsourced employees to understand the technology at hand because they’re constantly on the move.
Why is Build Operate Transfer Model Gaining Popularity?
The Build Operate Transfer model does not involve any labor outsourcing. Instead, it means that companies do not have to worry about the business continuity or tax issues associated with staffing augmentation services.
Also, if a company has an urgent requirement for a more skilled employee, the Build Operate Transfer model is flexible enough to accommodate these requests.
Build Operate Transfer models are more beneficial for companies looking for low-cost development centers in countries with lower labor costs, strong IT talent and schools. In addition, staff augmentation services can be used by organizations whose business requirements are more temporary or project-based.
BOT in Nearshoring
Web developers, app developers, digital agencies, online retailers, and other technology-savvy entrepreneurs opt for the BOT model of nearshoring. While cost savings are significant, participants still get all the benefits that an on-site nearshore engagement provides, like 24/7 support, round-the-clock office hours, and project management teams to oversee work.
Growth in technology has given rise to digital businesses that can operate anywhere worldwide. First, however, they need to manage customer relationships efficiently. Now that customers can be accessed and interacted with in real-time, companies need to ensure the availability of the right resources. It means having a dependable infrastructure in place to deliver an omnichannel experience to customers.
Additionally, technology adoption is picking up pace across various industries. However, there exists a considerable gap between the technical requirements of individual businesses. The BOT model bridges the gap by providing flexible engagement models adjustable according to business needs and requirements.
It has led e-commerce companies to explore BOT options to scale up or down their resources depending on changing business needs.
Who Should Consider a BOT Model?
Any company considering establishing a long-term IT and software development team in nearshore or nearshore locations can consider BOT. It offers a proven, dependable, and flexible delivery model.
It’s also an excellent option for companies with strict data, safety, regulatory, and compliance requirements. BOT providers can proactively address business needs keeping in mind the industry standards, best practices, and compliance norms.
BOT is beneficial for companies that look at achieving an intra-nation presence. BOT providers ensure high-quality resources with expertise in varied functional areas, leveraging and establishing a market stronghold.
The model is well suited for companies needing expertise in multiple development technologies like Big Data, Cloud Computing, Mobility, and Analytics.
With Digitanity’s BOT model, businesses can ensure the requisite infrastructure and resources to achieve their business goals. In addition, the availability of qualified resources on-demand provides low project risk with faster time-to-market for projects.
The best part about this project delivery model is that it provides an opportunity to assess the quality of services a development team offers before going in for a long-term engagement.