Build-Operate-Transfer Model Strategy for the Tech Crisis

February 3, 2023

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Finding your way through the current US tech crisis turns imperative right now. On one end, you’ve got the massive layoff environment where Big Tech companies are letting go of hundreds of workers. On the other end, you’ve got talent shortage issues that don’t show any signs of slowing down. For both ends, there is a common solution: Introduce the Build-Operate-Transfer model to your business strategy.

But, first:

Tech Crisis Outlook

Massive Layoffs Landscape

US technology companies, including giants like Meta, Google and Amazon, are laying off thousands of employees. In one of the worst contractions in history, layoffs at technology companies in the US reached a more than two-year high as they prepared for a potential recession by hiring at the second-fastest rate ever.

As a result, technology companies slashed over 154,843 positions last year. Furthermore, ​​technology companies have already let go of 85,200 more workers in 2023. 
In the end, businesses throughout the US are significantly reducing employment as part of their restructuring efforts to be ready for a likely economic downturn. The fact that this is merely the beginning is alarming. However, one important thing to keep in mind is the premise that tech workers who lose their jobs swiftly find new ones. In fact, published in November 2022, a research discovered that eight out of ten tech professionals who had been laid off find new employment within three months of beginning their hunt. And some are even luckier: over 40% of people who lose their tech jobs do so within a month.

Tech Talent Shortage Landscape

Let’s get one thing straight: Even though the Big Tech are letting go off a great number of workers, there is still a tech talent shortage thanks to the unmet demand in all industries. 
Leading market intelligence company IDC projects a 4 million developer shortage by 2025, while the U.S. Bureau of Labor Statistics projects that by the end of the decade, there will be a need to fill over 200,000 developer positions annually. Moreover, while there is a chance for developers to profit from a strong job market thanks to this type of employment demand and potential job stability, there is a drawback. According to Forbes, the complexity of software development jobs keeps rising, which has the unfavorable effect of counteracting the enthusiasm many developers have for their work.

What is the Build-Operate-Transfer Model?

Gartner Research describes it as a contractual arrangement in which a company employs a service provider to establish, enhance, and manage a business (or process/service/delivery) operation with the express purpose of transferring the whole operation to the company when the time comes. 

In other words, when implementing the BOT model, you are partnering up with a service provider that will come to know your talent needs and will reach out through its databases to find tech talent tailored to your needs. After your partner sets up, optimizes, and manages the process on your behalf and it’s operating well, they hand off control of the operation back to you.

Example of Build-Operate-Transfer Model in Action

In the software development landscape, let’s say firm A is a life science company in need of tech talent and developers for its new medical device development; so, firm A decides to give the BOT model a shot.

Firm A finds a service provider, firm B, a specialized company that works in building software engineering teams in Mexico.

1. Build: Firm B gathers the team based on Firm A needs and the specialization of the developers.
2. Operate: After both firms have come to an agreement about the specialized team, Firm B starts operating the project and performs day-to-day operations hand by hand with firm A’s involvement and instructions. Basically they started working together while firm B’s sw engineering team started to catch the pace.
3. Transfer: Finally, after firm A considers the team provided by firm B is ready, they go through a stage by stage seamless transfer fully to firm A. They are no longer firm B’s team but firm A’s completely. Afterwards, there is an extended support on behalf of firm B.

BOT model: Keeping the Tech Crisis in Perspective

In view of the current economic state with both landscapes, layoffs and tech shortage, the idea of nearshoring comes into perspective as many organizations have just recently begun to realize its true potential.

Right now, CIOs and CTOs are putting a focus on remote work, hiring in-demand IT talent, and using AI and analytics tools to optimize efficiency gains in order to recession-proof their companies. One way to do all of this is to apply the BOT model through nearshoring. 

One of the strongest advantages of accessing a BOT model through nearshoring is that you enjoy a large and vast pool of talent. Now, you have the chance to access a genuinely global network of experts. Let’s say you choose Mexico for example: With 25% of all Mexican university graduates majoring in STEM, Mexico has one of the highest rates of engineering graduates in Latin America. Numerous Mexican colleges are among the top 50 in Latin America, demonstrating the outstanding caliber of these institutions. Furthermore, more than 130,000 engineers graduate each year summing up to a talent pool of over 700,000 tech professionals. Overall, that’s an opportunity no one would like to miss.

The build-operate-transfer model makes it possible to adjust the ‘ups and downs’ with a contract! Schedule a call with us.

About ITJ

ITJ is devoted to serving fast-growing and high-value market sectors, particularly the Internet of Medical Things (IoMT), working with innovative medical device companies looking to improve people’s lives. With a unique BOT (build, operate, and transfer) model that sources only the best digital talent available, ITJ enables companies in the US to create technology centers of excellence in Mexico. For more information, visit www.itj.com.