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CTO as a Service (CaaS). What Is It?

Dawid Pacholczyk 3622ceab56

29/03/2022 |

7 min read

Dawid Pacholczyk

Do you have an idea for a brand-new app? Or maybe you are already running a business and want to scale it faster with technology? Or perhaps you just want to check whether your software development team works well and delivers high quality? Outsourcing CTO, also called CTO as a Service, is likely what you’re looking for.

Running a business is a complex endeavor, and you may not always have the time, mind space, or energy to control every single aspect of your IT capabilities. This is where CaaS comes in handy. All you need is a CTO you can hire, so they analyze your product and give you advice about technical and business implementation. 

What exactly is this service all about? How does it work? And what value can it bring to your business? Keep on reading this article to learn everything you need to know about CaaS. 

 

Table of contents:

  1. CTO as a Service: what does it mean?
  2. Types of CTO as a Service
  3. Outsourced CTO – pros and cons
  4. CTO as a Service – summary

CTO as a Service: what does it mean? 

CTO as a Service (CaaS) is a technology and business advisory service realized in the role of the Chief Technology Officer who assists the company on its mission. 

Depending on the duties and form of cooperation with the CTO, the service may take on different forms. For example, if all you need is consulting, you can hire a part-time or fractional external CTO. But when looking for more comprehensive technology and business support, you might need a full-time CTO.

Example CTO roles and responsibilities

  • Discovery phase – You can hire an external CTO to help out with the discovery phase of the product, such as designing the technical solution, identifying the best matching tools, building a tech stack, clarifying project goals, and MVP development.
  • Technical solution development – CTO combines development expertise with business knowledge and can assist you with finding the best solutions for technical challenges. A CTO also helps to align with your product goals, extend functionality, create and improve the architecture, oversee the software development life cycle, or carry out complex integration tasks.
  • Scaling a product – CTO can help in business analysis as well, evaluating your current business needs and creating a complete scaling strategy. This includes identification of the most cost-effective solutions, analyzing possible approaches to hosting, developing a reliable and available technology infrastructure, and riskless project expansion.
  • Recruitment – It might come as a surprise, but the CTO often serves as a recruiter for the management and developer teams. In this scenario, this role can help you create criteria for hiring technical employees, evaluate the technical expertise of candidates, and carry out technical interviews.

Types of CTO as a Service

Full-time internal CTO 

This type of CTO provides your company with thorough technical and business expertise. Their responsibilities involve support and development, planning, and management in real-time. 

However, hiring a CTO as a full-time team member is going to cost you a lot – starting from HR expenses related to sourcing, attracting, recruiting, and onboarding to overhead expenses such as office rent, workspace taxes, and more. 

Full-time offshore CTO service

When you hire a full-time offshore CTO, you get all the advantages from full-time collaboration while paying a reasonable salary. In such virtual CTO services, the external specialist essentially becomes an in-house expert – a remote professional who works full-time and exclusively for your company. 

This option is particularly interesting to companies operating in locations where IT talent is scarce and/or extremely expensive. 

Part-time offshore or fractional CTO service

Part-time CTOs usually work on the basis of the agreed number of hours. This gives you the opportunity to evaluate the service and pay only for the time dedicated to your tasks. Virtual CTO services delivered part-time or fractionally are a fail-safe approach to getting the CTO expertise on board. 

The fractional CTO outsourcing model reduces the engagement even more. Naturally, this is the most cost-effective cooperation model. 

One-time CTO service

This type of service focuses only on the required areas of responsibilities and processes in the form of a workshop or audit (that may last several days or weeks). An outsourced CTO is usually hired to troubleshoot a technical problem or carry out an audit inside a company or development team. 

Interim CTO service

An interim outsourced CTO is a technical expert who you hire to temporarily assist with business or technical responsibilities while you’re busy hiring a full-time internal CTO. 

This is a particularly attractive alternative for startups that are looking for a full-time CTO but can’t afford to waste any time on development. At the same time, they don’t want to compromise quality. 

That way, the company can avoid risks in technological processes and decisions, remain active, and take advantage of the technical consultant’s expertise.

Outsourced CTO – pros and cons

Advantages of CaaS

  • Cost-effectiveness Many small and medium businesses, including startups, need CTOs, but they can’t always afford to hire one in-house. That’s why outsourcing the role of CTO is such a great solution. You get all the required services for a lower price and administrative overhead.
  • No hiring hassle – By working with an external CTO, there’s no need for additional recruiting expenses. You also eliminate all the administrative tasks like perks and benefits. When you hire an external CTO, you only pay for the work and services to request.
  • Larger talent pool – By outsourcing the CTO function, you get access to a wider choice of experts. You can use outsourced CTO services to have an expert supervise your team and benefit from top talent no matter where your business is located.
  • Greater agility – Building a startup without hiring a CTO is possible but expect a rocky road. At the same time, a few technical consultations might be enough to clarify the core business or technical issues. Bringing in a CTO consultant is a smart move – they usually offer some fresh ideas on how to reach your business goals faster.

Risks of CaaS 

  • Trust – An outsourced CTO position may have a massive impact on how your development team works and business delivers value. That’s why building trust in a CTO outsourcing scenario is quite tricky. Lack of trust might result in miscommunication or stressful situations when you feel like you can’t rely on the person or make a mistake when hiring one.
  • Context switching – If you hire an external CTO on a part-time basis, the person is going to work across several organizations. As a result, they will switch contexts often, which might impact the quality of services provided.

CTO as a Service – summary

As you can see, CaaS is an incredibly valuable service to companies looking for top tech talent and expertise where technology and business perspectives are seamlessly combined. 

At the same time, this type of service opens the door to hiring a CTO for companies that can’t afford one at the moment. Startups and SMEs can develop their solutions confidently with a virtual CTO service on board, even if this professional isn’t part of the in-house team. 

If you’re looking for CaaS expertise, get in touch with us. We have talented tech experts on board who can lead your team and product in the right direction.

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Dawid Pacholczyk 3622ceab56

Dawid Pacholczyk

Consulting Manager at Codete with over 15 years of experience in the IT sector and a strong technical background. Seasoned in working with multinational companies. Ph.D. student and lecturer at Polish-Japanese Academy of IT, focused on software architecture, software development and management.

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