Mobile apps, websites, SaaS platforms, enterprise software, AI solutions… you need a software development team for almost any tech product you want to build.
Now what’s the ideal structure for such teams? Who does what? Should you build in-house or look for talent elsewhere?
In this guide, we answer these and more questions to help you set up a dev team the right way. Let’s get started!
What is a software development team?
A software development team builds software from idea to final product.
These teams are formed by tech specialists responsible for different stages of development, including planning, coding, and testing. Together, they create reliable, high-quality software that meets user needs and business goals.
When organisations can’t find the right talent in-house, they may opt to outsource certain roles or go offshore to extend their existing team. For example, the Australian firm My Muscle Chef tried both approaches and found success with a unique offshore model that allowed them to achieve a 50% boost in development speed and a significant reduction in tech debt.
Software development team structure: 10 pivotal roles
There’s no predefined structure for a software development team, as roles and hierarchy may vary depending on the project size, complexity, and business needs. The roles listed below are the key positions every dev team typically has.
Product Owner
Product owners are responsible for defining the product vision. Their main goal is to ensure that the final product meets customer requirements, so they must prioritise features and create a backlog that outlines what needs to be built and in what order.
Project Manager
While product owners are focused on the product’s evolution, project managers plan the project’s activities so everything is delivered on time and within budget. They assign tasks, maintain a schedule, and track progress.
Software Architect
Software architects design the high-level structure of software systems, ensuring scalability, security, and maintainability. They choose technologies, define coding standards, and guide developers in implementing the architecture.
Development Team Lead
Also known as engineering managers or tech leads, they oversee the work of every software developer in the team. Their job is to motivate and mentor engineers, as well as guarantee that technical decisions align with project goals.
Business Analyst
Sometimes mistaken for product owners, business analysts focus more on the technical and operational aspects of the project. They’re responsible for gathering requirements, analysing customers’ business needs, and translating them into clear specifications for the dev team.
Software Developers
Developers are the members of a software development team who (literally) bring the product to life by coding its features and functionalities. For many, they are the most essential role in a dev team, as you can’t write, maintain, optimise, and implement new features without them.
Quality Assurance (QA) Engineer
If software developers build software, QA engineers make sure it complies with performance and quality standards. They run different types of tests to verify the product isn’t defective, including functional, performance, security, and usability testing.
UI/UX Designer
UI/UX designers work very closely with developers to make the product as easy to use and intuitive as possible. Although they might be the least technical professionals in a software development team, their expertise in prototyping tools and design systems is fundamental to making products accessible and functional.
DevOps Engineer
DevOps engineers connect development and operations, making software delivery faster and more efficient. They build CI/CD pipelines, automate workflows, and ensure updates are released quickly without compromising stability.
Scrum Master
The Scrum master’s job is to set sprints using the Scrum methodology and eliminate obstacles affecting the progress of the project. Their role is different from that of a project manager, as the latter focuses on high-level project execution, and scrum masters are responsible for managing the Agile process. In large teams, both roles can coexist.
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DOWNLOAD CASE STUDYHow to build a successful software development team
Now that you understand the key roles in a software development team, it’s time to build yours with a structured approach that fits your business needs.
1. Choose the right development methodology
The first step to building a successful dev team is to define what methodology your team will use to complete projects. Choosing one or another will influence the way people work and the specific roles you need (and don’t need).
For instance, if you go with Waterfall, you won’t need a Scrum master in your team, as this role is exclusive to teams that work under Agile methodologies.
Here’s a quick breakdown to help you decide which of the three most popular methodologies (Waterfall, Agile, or Hybrid) aligns best with your requirements:
- Waterfall is the right fit if your projects follow a linear structure and don’t require significant changes once started.
- Agile is a strong choice if your projects demand flexibility, frequent iterations, and fast releases.
- Hybrid works well when parts of your project benefit from a structured approach (Waterfall) while others require adaptability (Agile).
2. Define team size and composition
After choosing the development methodology, you can start considering the size of the team and its structure. The number and type of specialists can vary depending on factors such as:
- Your budget.
- Your project’s complexity.
- Your time-to-market goals.
Let’s say you’ve decided your new dev team should follow the Agile methodology because you need to build, release, and continuously improve a mobile app with highly technical and evolving specifications. Your budget is designed to get the best value for money.
In this case, since the focus is on long-term development rather than a one-time project, you can start with a small team of software development engineers specialised in Kotlin or Swift and extend it with other technical roles as your needs change.
3. Look for the best talent
Now, how can you hire top talent for your software development team? Well, that depends on your software development strategy and whether you prefer to set up an in-house team or a team in another country with professionals who may best fit your requirements.
These are some of the hiring models you can use to build your team:
- In-house development. It involves hiring software development talent within your home country. You’ll be limited to looking for specialists locally, but you’ll have the opportunity to work with them face-to-face in your office and have full control over their work.
- Nearshoring. If you want to hire talent in neighbouring countries, nearshoring might be your best bet. It allows you to expand your search to larger and stronger talent pools while working with your team across minimal time zone differences.
- Outsourcing. This model is an excellent solution if you need a team to complete short-term projects or temporary tasks. You can outsource software development in your own country or elsewhere.
- Offshoring. Contrary to outsourcing, offshoring is for those looking to set up a team that adds long-term value to their business. If you’re looking for world-class talent in some of the best tech talent pools in the world, offshoring is the way to go.
Generally, tech leaders who prioritise cost-effective access to top talent choose offshoring as their preferred model.
4. Pick the right development partner
To build a software development team the right way, you must consider collaborating with a development partner, especially if you decide to hire specialists in another country.
Just think about all the legal, administrative, and other tasks you’ll need to do on your own, knowing very little about the region where your potential team will work and live. A reliable partner doesn’t only help you with finding talent, but with setting up operations abroad.
Imagine you decide to go offshore and build a dev team in a renowned tech hub like Bangalore, India. These are the aspects you should consider to pick the right offshore development partner:
- Double-check their expertise and assess whether they have experience in hiring for the roles you’re looking for. One of the best ways to verify this is by reading case studies.
- Evaluate if the services they offer are as cost-effective as they claim. Some partners give vague answers about pricing, which may indicate hidden costs.
- Analyse their approach to communication and how they bridge cultural gaps between you and your team. You need a partner who works towards minimising any barrier that may arise, as the specialists you hire are located in a country with significant cultural differences from yours.
After following these steps, you’ll be closer to finding a partner to assist you in building a team with software developers, business analysts, product owners, and any other role you need.
5. Establish clear communication and collaboration tools
Poor project management is one of the most common SDLC challenges and is strictly related to the failure of dev projects.
A recent Boston Consulting Group study found that 29% of businesses and C-level executives cite a lack of collaboration and coordination as key factors behind tech project delays, both of which fall under ineffective project management.
So, to set up a successful development team, you must use tools and systems that guarantee that projects don’t get stuck due to miscommunication. Even the best project manager struggles without a structured environment and clear ways of working.
The right dev partner has processes in place to ensure everyone in the team stays on track and well-informed at all times, even if they are thousands of miles away from your headquarters.
Typically, they rely on communication platforms like Slack or Microsoft Teams and project management tools like Jira, Trello, Asana, to keep your team aligned, track progress, and address potential roadblocks before they become major issues.
6. Define performance metrics and success indicators
Tracking performance keeps your dev team on point. Without clear metrics, it’s impossible to know what’s working and what’s not.
Here are a few key performance indicators (KPIs) you can use to measure progress:
- Velocity shows how much work gets done per sprint (Agile teams), usually measured in story points or completed tasks.
- Cycle time measures how long it takes to complete a task from start to finish.
- Lead time tracks the duration from an initial request (or idea) to its release.
- Deployment frequency indicates how often new code is successfully released to production.
- Change failure rate represents the percentage of deployments that result in failures requiring fixes.
- Mean Time to Restore (MTTR) calculates how quickly the team can recover from failures or outages.
- Defect density measures the number of bugs per unit size (typically line of code or features).
- Customer satisfaction (NPS, app ratings, CSAT) gauges user feedback on the product.
Keep in mind that the goal isn’t just to track numbers but to build a team that delivers, learns, and gets better with every cycle.
Common pitfalls and solutions when building a software development team
Even after defining your software development team’s structure and starting to set it up, you may still face roadblocks that impact software production.
Here are the most common mistakes and how to solve them:
Choosing the wrong development methodology
Earlier in this article, we covered how important it is to start building your team by choosing a development methodology. This will ultimately help you assess what specialists you need and what roles they will have in your organisation.
See, if you go with Waterfall but then realise your project requires an Agile methodology instead, you may end up over- or under-hiring, mixing up requirements and responsibilities. It can be a waste of time and resources that affects the whole development process before even kicking it off.
Solution: Assess business needs before selecting Agile, Waterfall, or a hybrid model. Involve stakeholders and ensure the methodology is aligned with the project scope, timelines, and the level of flexibility required.
Failing to plan for team scalability
Some companies build a dev team to cover an immediate need. For example, adding an extra feature to their product. They hire a bunch of developers via outsourcing to do the job and close the project.
Then, there’s another group of organisations that set up a team, ignoring they may need to extend it in the future as their product grows and evolves. Many fall into the mistake of choosing a hiring model that doesn’t allow them to scale when needed.
Solution: Plan for future expansion and pick a hiring model, like offshore software development, that lets you scale your team and add more talent at the right time.
Overlooking cultural fit in hiring
The degree to which your dev team align with your company’s values, mission, and vision is as important as the skill sets they possess. Indeed, according to The Global CTO Survey 2024/25 Report, culture fit and technical skills are the top hiring criteria for CTOs.
Still, there are organisations that tend to prioritise candidates’ expertise in programming languages or certifications over how well potential new team members fit into their corporate culture. The results of this strategy can be disastrous, leading to bad hires and a lack of team cohesion.
Solution: Look for a software development partner that not only sources elite talent but also guarantees candidates’ cultural alignment in their hiring strategy and keeps professionals engaged daily.
Not investing in continuous learning and development
A software development team that doesn’t receive regular training on the latest technologies, frameworks, or strategies is at risk of falling behind. How can an engineer add long-term value to a business if they’re stuck in outdated coding practices?
Similarly, specialists who lack basic soft skills may struggle to collaborate with their team or clearly convey their ideas across the organisation.
Solution: Provide training, certifications, and knowledge-sharing sessions to keep hard and soft skills up to date and developing. The right development partner invests in the teams’ skills and growth and offers such trainings, even with a dedicated Learning and Development Manager (L&D Manager).
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LEARN MOREBuild a world-class software development team with The Scalers
If you’ve read this far, you’re probably ready to build or extend your software development team. Or maybe you’ve already tried but weren’t happy with the results.
At The Scalers, we’ve built over 100 tech teams using the best offshore model to hire the top 1% of Indian engineering talent in Bangalore. We’ve helped organisations of all sizes and industries, including FinTech, MarTech, Retail, and Ecommerce, achieve their goals.
What sets us apart from other software development partners is our people-centric approach. Your team isn’t just a group of developers but an extension of your company. We make sure they’re fully aligned with your vision, values, and culture. Plus, we take care of everything on the ground, so you can focus on growing your business.
Do you want to know more about The Scalers’ model and how we can assist you in building a high-performing software development team? Fill out this form and one of our senior executives will come back to you promptly!
In the meantime, check out our case studies for more success stories like Nexpoint’s.
In summary
A software development team can vary in size and nature depending on your unique needs and evolving requirements. You can start with as little as 5 software engineers and a product owner and expand it over time to, let’s say, 20 specialists.
Just make sure you choose a hiring and engagement model that gives you the chance to hire top talent and grow your team on demand.
FAQs
What is the ideal team size for a software development project?
The sweet spot is usually 5-10 people. Small enough to stay agile, big enough to cover key roles without burnout. However, organisations may consider scaling their teams with key roles to 20, 50, or even 100+ as their business and product offering grow.
Which is better, hiring freelancers or a dedicated software development team?
Freelancers are great for short-term tasks, but a dedicated software development team gives you consistency, better collaboration, and long-term success.
What are some challenges software development teams face?
Communication gaps, shifting requirements, unrealistic deadlines, and keeping up with new tech. Good leadership and clear processes help tackle these.
How long does it take to form a fully functional software development team?
It can take weeks to months. Finding the right people, onboarding, and getting them to work smoothly together takes time.
