Pros and Cons of Outsourcing CTO Services

May 6, 2020

The tech landscape is changing rapidly. In order to adapt to these changes and grow, a business needs better strategies. Many companies in the tech industry usually hire a consultant or a contractual CTO. It has become clear to many in the industry that having a part-time CTO can fulfill the same responsibilities as someone hired in-house. They can lead a company’s implementations from a strategic standpoint and ensure that the systems are updated and working properly.

This role is commonly in demand with startups. “Most startups don’t need a full-time CTO to handle strategy, a fractional CTO works extremely well in those situations,” said Tony Karrer,  a Consulting CTO.

Businesses that rely on tech and software will agree that it is vital to have experts to help them manage the whole system. It is helpful that the management team is partnering up with a team of software experts to establish tech strategies, whether it is for short or long term purposes.

What is the answer?

For some, DIY is an option. Someone in the company who has experience with handling tech initiatives could do it. However, this raises some potential issues:

1. It takes your eyes out of the big picture.
   As the owner of the business, your primary role is to manage your business and focus on what requires much attention. And make sure your business is heading in the right direction.
2. It takes more time to execute the new tech project.
   Some of the companies have in-house management that has experience with coding, but they do not have the specific skills and experience on what it needs to be done and how to do it on time.

Let’s look at the pros and cons of this scenario:

Cons

1. Outsourcing your CTO requirements could mean that you are potentially exposing some of your “secret sauce”. You will have to make sure that you have signed an NDA and enlist a creditable software developer to mitigate such risks.
2. You need to allow for time for the CTO to get up to speed with the business. Just like a new hire, you will need to allow for an onboarding period where they become familiar with the organisation.
3. Not all are built the same. A level of due diligence will need to be done before hiring a firm to conduct your CTO requirements.

Pros

1. They help figure out what needs to prioritize and how to adjust in order to shift troubling situations.
2. Access to a pool of CTOs and supporting services.
3. Reduce costs significantly by avoiding the huge salaries, bonuses and other perks often required to attract and retain in-house CTOs.
4. Access to external know-how brings in fresh ideas into the mix.
5. Better redundancy as you are not dealing with a single person.
6. Get expertise from a top-level professional whose real-world experience and an unbiased view of best practices and vendors will make your IT department more productive and efficient.

The option of outsourcing the Chief Tech Officer role might be the answer to your current tech challenges. What makes having one is adding exceptional value to the business.

We can help you build a product that is secure and scalable. Contact us!