For leaders in established brands, undertaking a digital project is a significant opportunity, and selecting the appropriate resource for executing your vision can be a key differentiator between a successful project and an over-budget, delayed, or substandard mess. These decisions are not easy. With an array of options available, it can be challenging to determine which approach is best suited to your company's present needs.
Creating digital products is somewhat like building a house. You have a few options when it comes to assembling the best team for each specific job. You could personally employ a full-time carpenter to build your house, who has expertise in a variety of areas, but can only work a reasonable number of hours per week and might need to learn electrical wiring on your paid time. You could manage a team of contractors to build your house, which provides more flexibility and the ability to bring in specialists as needed. However, coordinating and managing multiple contractors can be time-consuming and challenging. Or you could hire a construction company to create your home by offering access to a team of craftsmen with diverse skill sets working together. However, you may lose some control on the end result and be worried about surmounting costs.
Just as every homeowner has different needs when building their house, every company has unique requirements when creating digital products. The key is to assemble the right team who can supply the expertise and an appropriate approach to align with your goals and budget. It sounds simple enough, but anyone in this position can tell you there is a lot to balance and many stakeholders to account for.
In this article, we offer an in-depth breakdown of the advantages and disadvantages of various approaches for your digital projects, including internal resources, consultants/contractors, traditional agency engagements, and dedicated teams from agencies. We'll delve into the intricacies of each approach, explore their benefits and drawbacks, and provide you with the information you need to make an informed decision. You will finish this article with a better understanding of which approach is the most suitable for your upcoming or ongoing digital projects. Whether that is to leverage your internal processes or ramp up with external resources, our aim is to provide you with the insights to guide your process.
Internal Resources
When embarking on a digital project, it's natural and often good strategy for companies to start by leveraging their internal resources. Utilizing an internal team brings key benefits that are hard to replicate with external options. Firstly, internal teams possess a deep understanding of the company's inner workings, priorities, and culture. This familiarity allows them to navigate the project intrinsically and adapt to changing circumstances more effectively than external resources. Their direct integration within the organization can also facilitate communication, ensuring that the project aligns closely with the company's objectives. Moreover, internal teams provide a higher level of transparency, enabling better cost control and accountability. By leveraging these internal resources, companies can often achieve high cost and time savings, maximizing the efficiency of their digital projects.
However, the effectiveness of internal teams varies greatly depending on their structure and management style. Several factors come into play, such as team size, composition, skills, and working relationships, which collectively determine the team's success. If a team lacks the necessary skills or capacity to successfully complete a project, it can pose significant challenges for companies, especially when dealing with new technologies or projects. Moreover, adjusting the size of an internal team can be a time-consuming process that involves coordination with HR and finance departments. Internal politics and conflicting priorities can further exacerbate delays and reduce overall productivity. Additionally, the financial implications associated with having an internal team extend beyond salary considerations alone. For instance, hiring an entry-level digital marketer with a $45k annual salary entails additional costs such as onboarding expenses, benefits, insurance, and employment taxes. These fully loaded costs typically amount to an additional 30% to 50% on top of the salary, and also carry higher liability considerations.
To overcome these challenges, companies need to focus on building base skills that are constantly reusable and/or broad on the team. While external resources can be brought in to supplement the team's skills or bandwidth, it's essential to maintain a strong internal core. It is the foundation of the company, and the guiding to ensure that the company's direction remains on track. By striking the right balance of resources, companies can maximize the chances of project success while ensuring that the company's long-term goals remain the top priority.
Benefits:
Familiarity with company culture and workflow built over years or decades
Ability to pivot quickly if there is current bandwidth
Direct communication and collaboration with other departments
Deep understanding of the company's specific industry
Internal reporting is more transparent and timely
Challenges:
Specialized expertise may not have consistent demand
Project timelines compete with other day-to-day demands
Slow to ramp up and wind down; resourcing may involve HR and finance departments
Internal politics and conflicting priorities can hinder progress
Workload may be already at capacity
Be sure to calculate the total loaded cost of an FTE when comparing alternatives
Freelancers/Contractors
Freelancers are independent professionals who offer specialized skills and work on a project-by-project basis. They are usually found through referrals or on digital marketplaces like Fiverr and Upwork and can be a cost-effective alternative to hiring a full-time employee or outsourcing to an agency.
The main benefit of working with freelancers is simple - flexibility. They can be hired as needed and brought in at any stage of a project, making them a great option for companies with fluctuating project needs. Freelancers also tend to have specialized skills, can offer great results, and have experience in a specific area, which can provide a fresh perspective and help overcome obstacles that internal teams may not be able to. Additionally, since they typically work from their own location and don't require the same overhead as full-time employees, they can be comparably cost-effective depending on the length of the engagement. As with the following external options discussed below, they typically carry significantly less legal liability when compared to a direct employee.
As with all approaches, there are potential drawbacks to working with freelancers. They are, by nature, solo providers, and even the best ones can have trouble absorbing swings in demand. Communication can sometime be a challenge as they may be working on multiple projects simultaneously, making availability variable from week to week. Also, freelancers tend to be freelancers for a reason - they enjoy the autonomy to choose the most interesting and profitable projects available and may not be open to working on multiple concurrent projects. It can be time-consuming for your team to source quality providers who have the necessary skills and experience, and even if you do find a great provider, there's no guarantee you won’t be sourcing a replacement in a few weeks or months.
To mitigate these risks, it's important to research and vet potential freelancers thoroughly. Look for freelancers with a proven track record of success and experience working on similar projects. It is also wise to consider testing multiple contractors with a smaller initial project and then moving forward to larger undertakings with your top choice. In each case, establish clear communication and expectations for the onset to ensure they align with your company's goals and timeline. Maintain strong internal project management and communication, especially when developing new relationships with freelancers. A poorly defined scope or expectation can lead to project creep and misaligned results. Finally, it should go without saying, but once you do find a great provider, compensate them well to make sure your priority is aligned.
Benefits:
Flexibility to ramp up and wind down resources quickly
Ability to augment skillsets that an in-house team may not currently have or need long-term
May bring outside perspectives from similar or different industries
Detached from challenges with internal politics and conflicting priorities
Challenges:
Potential communication challenges, including context setting with each provider
Managing multiple contractors is a full-time commitment, and difficult to coordinate full teams for complex projects
Shopping for effective freelancers is time-consuming and may take multiple attempts
Potential for inconsistent quality or performance
Traditional Agency Approach
A traditional agency is a professional services company that employs a diverse range of experts, including strategists, project managers, designers, marketers, and developers. Agencies collaborate with clients to undertake various, and often larger, digital projects and in many cases offer a wide spectrum of services. Their teams come in different sizes and specializations, from small boutique firms to large multinational corporations, catering to diverse industry needs. When considering engaging a traditional agency, it is essential to carefully assess alignment with your project requirements.
Partnering with an agency may offer compelling benefits for your company. By collaborating with an agency, you gain access to a diverse team of experts with specialized skill sets and extensive industry experience. This expertise extends beyond project implementation to include strategic insights. With a larger client base, agencies bring a wealth of perspectives and experience across diverse industries. They also provide valuable resources, tools, and technology that accelerate project timelines and enhance productivity. Leveraging dedicated project management and streamlined processes, agencies excel in coordinating teams, managing timelines, and facilitating effective communication. This means you can have a website developer with a decade of experience for a month, week, day, or even an hour, then substitute a tenured copywriter without any direct coordination from your team. Additionally, they may offer your internal team some objectivity, enabling them to offer strategic guidance. Partnering with a well-fitting agency can help you achieve exceptional results in your digital projects.
As with our previous approaches, agencies are susceptible to their own list of drawbacks. A primary consideration for many teams is the higher fees. The resourcing costs of employing numerous experts, subscription fees for tools and technology, and business overhead must be covered through fees to clients in the same way as any other business. In addition, differences in communication styles or processes may lead to misunderstandings and project delays, and some internal teammates may feel a loss of control or ownership over the project. Conflicts may arise over the direction or quality of the agency's work, leading to further challenges. Lastly, remember that in-demand agencies have a list of ongoing clients, and timing expectations must be well communicated.
Finding and maintaining a strong agency partner can lead to a relationship that sees both teams prosper, and many digital leaders maintain trusted agency partnerships throughout their careers or even between companies.
Benefits:
Augment your team with a range of services from strategy to execution
Higher level of strategy and technical guidance
Specialized expertise available on an as-needed basis
Valuable project management processes, tools, and resources for consistency
Expertise in the latest tools and technologies to stay ahead of the competition
Challenges:
Hiring an agency can be expensive compared to other approaches
Communication and collaboration is an ongoing effort
Companies may not have as much control as they’d like over the project
Difficulty in managing agency processes and methodologies
Dedicated Team from an Agency
If you've considering hiring an agency to handle your project, a similar option you may have come across is a dedicated team. Dedicated teams are a specialized offering from some agency partners, where a specific group from within the agency is assigned to work exclusively for a single client. This differs from the traditional agency model, where teams largely work across multiple clients, and it is a strategy usually reserved for projects that require significant time and resources. Think along the lines of large software projects or spinning up new brands that can take several months to multiple years to complete.
A dedicated team can bring together some of the best parts of working with both an internal team and an agency. Like an internal team, a dedicated team can feel like a natural extension of your existing workforce and focus exclusively on your project to offer a higher degree of control. Communication is streamlined, and the team can work closely with your internal teams to increase speed and the likelihood of success. Like an agency, a dedicated team can provide specialized expertise, resources, and project management to leave your core internal team unburdened while still providing flexibility in scaling up or down the team as needed.
And then there are the challenges. Even compared to a traditional agency relationship, their price of hiring a full-time team of experts should be approached wisely. While the team is not directly employed by your company and thus carries less liability, you are paying for sole access to their time and attention. Initial onboarding can also be a time-consuming, as the agency team needs to fully understand your company's culture and goals to set the project off in the right direction. This can result in some delays at the beginning of the project. Additionally, you are still giving up some level of project control in order to ensure that your time is dedicated in other priorities.
Despite these challenges, a dedicated team from an agency can still be a highly effective option for project execution. When considering a dedicated team, it's important to ask potential agencies about their approach to project management, their expertise in the specific areas needed for the project, and their track record of success. Decision-makers should carefully evaluate the potential benefits and challenges of utilizing a dedicated team and determine if it is the right option for their specific project needs.
Benefits:
Feels like a natural extension of your internal team with greater collaboration
Specialized expertise and knowledge
Greater flexibility in terms of scaling the team up or down for projects
Less time-consuming for project managers, and the ability to keep internal resources focused.
Challenges:
Higher costs associated with utilizing an outside agency
Steep initial learning curve and onboarding time
Limited control over the team's schedule and priorities
Potential issues with meeting deadlines and achieving project goals if mismanaged
When it comes to managing digital projects, choosing the right approach can be a difficult decision. With options like utilizing internal resources, hiring freelancers/contractors, or working with agencies, it can be overwhelming to determine which will be the best fit for your specific needs.
Get in Touch
At GRAYBOX, we recognize the challenges of this decision-making process. With over 14 years of experience and 4,000 completed projects, we have the expertise to help guide you toward the best solution for your project. Our two distinct options, traditional agency and dedicated teams, provide specialized expertise, flexibility, and a focus on results.
We understand that each project is unique, and we offer tailored solutions to meet the needs of each client. Our team of experts is available to discuss your project's specific requirements and provide guidance on the best approach. Contact us today to learn more about how we can help you achieve your digital project goals.