When companies are seeking outside help to complete critical IT projects, they often consider two fundamental delivery models: outsourcing and staff augmentation. Generally, staff augmentation is a hiring model that leverages temporary workers to fill short-term vacant job positions within an organization.
Although relatively similar to project outsourcing, there are several distinct elements that differentiate staff augmentation from outsourcing. Unlike outsourcing which requires the hiring company to purchase a specific outcome and share the risks with the vendor, staff augmentation allows the hiring company to maintain control over the team and the project’s deliverables.
According to a report published by Statista, the global staff augmentation services grew from 5.2% in 2018 to 6.3% by 2020. And with the onset of the global Covid-19 pandemic, more and more companies worldwide started turning to team augmentation services to find experts with the right technical skills. A different report by SpendEdge projects that the global staff augmentation industry will grow at a 3.53% CAGR between 2021 and 2025, reaching the $81.87 billion mark. This growth can be attributed to among other things including superior flexibility, low risk, and seamless integration.
Different Types of Staff Augmentation
The staff augmentation business model can be profiled into two distinct categories: short-term and long-term. As the name suggests, short-term resource staff augmentation is applied when in-house employees are unavailable or there’s a short-term need for employees. Long-term staff augmentation, on the other hand, is utilized in projects with a significantly longer turnaround time, and there’s an exciting skill gap.
Staff augmentation solutions can further be divided into three categories:
- Commodity. This comes into play when a company is looking for a trustable workforce that does not necessarily have specific skills.
- Skilled. Ideal for a company looking for specialists with specific skill sets, with the level of skills not necessarily critical.
- Highly skilled. This type of resource & staff augmentation entails hiring professionals with advanced skills gained through effective experience and training.
Types of Technical Staff Augmentation Service Providers
When it comes to engaging staff augmentation talent, there are multiple options to choose from, and your choice is pegged on the specific needs of your organization.
- Traditional staff providers. This category of service providers provides temporary workers to companies facing limited skills in-house.
- Master vendor staff providers. These are unilateral recruitment agencies that supply staff to organizations by doing all the legwork. They help fill the roles themselves and when they can’t, they partner with 2nd or 3rd tier recruitment agencies to help.
- Boutique agencies. These are small recruitment agencies that help companies source highly-specialized talents.
- Gig platforms. These are online platforms that act as a talent repository for companies and provide instant access to hundreds of independent workers.
- On-demand platforms. These are online platforms that allow companies to access highly-skilled specialists.
- Independent contractors. These types of specialists engage directly with organizations.
IT Staff Augmentation Role and Use Cases
As a business, hiring an in-house IT team can be costly and time-consuming. With IT staff augmentation engineering, you can procure highly skilled remote engineers and dedicate them to delivering a specific project within your organization. As such, IT staff augmentation can help reduce software development delays and even reduce organizational expenses.
Below are some instances where you can choose the staff augmented model for your business:
- Your in-house team has limited skills. As an employer looking to release a new product, you need a fully constituted in-house software development team. But what happens if they don’t have the necessary expertise? You can either choose the time-consuming option of training them or complement current expertise by using IT staff augmentation services.
- You are working on a tight deadline. Hiring, recruitment, and onboarding can be time-consuming. This is especially the case for highly specialized industries like IT. If your organization doesn’t have the luxury of time to wait for weeks or months to hire and assemble an engineering team, IT team augmentation can help your organization meet its needs both in the short run and in the long run.
- You need specific skills. If you have a special project that requires an equally specialized team of engineers or technicians, the team augmentation agile development model gives you access to a large pool of software developers from around the world.
How Does Resource and Staff Augmentation Work?
Although different industries have different hiring protocols, the process of workforce augmentation follows an almost linear trajectory, the industry notwithstanding. In this section, we have prepared a quick rundown of the process of IT augmentation works.
Determine your needs. The first step and critical step in staff augmentation require you as the business owner to clearly outline your outsourcing needs and goals. By doing so, it not only becomes easier to create the best proposition for the potential employees but also assembles a team of talented engineers who have the creativity, skills, and energy required to deliver your project on time and within budget.
Source the talent. After establishing your hiring needs, the next natural step is to start looking for the right staff augmentation contractor. Today, there are multiple staff augmentation firms out there and you want to choose one that thoroughly vets its workers. By having the right partner, you can rest easy knowing that the workers are equipped with the necessary skills to handle the task at hand.
Start the onboarding process. After you have the team onboard, it is critical to clearly define the roles and responsibilities of each team member. This helps eliminate confusion and ambiguities and confusion when executing the project. While at it, allow the team members to ask questions about the project and provide feedback as the project progresses to cultivate a cohesive environment.
Provide ongoing support. The process of IT and project management staff augmentation
Does not end with hiring the workers and leaving them to their own devices. You need to continue providing support and resources on an ongoing basis to ensure your project is completed on time and within budget.
Benefits of Technology Staff Augmentation Services
Today, most companies are looking into staff augmentation resources to meet budgetary and time constraints. In this section, we are going to look at some of the benefits of staff augmentation in detail.
Reduces Development Costs
Recruiting, hiring, and maintaining a full-time in-house IT team is expensive, especially for small companies. One of the biggest merits of on-demand outstaffing is its cost-saving aspect, both in terms of time and money. In staff augmentation project/s the cost of setting up new workspaces, and offering office equipment, hardware, and software is shouldered by the vendor, significantly saving you the money that would have gone to procuring all these equipment. Along with that, you don’t have to worry about catering for health insurance, sick leave, vacations, and filing tax returns for the employees, as this is the staffing vendor’s duty. True to this, a 2020 Deloitte Global Outsourcing Survey indicated that 70% of businesses use outsourcing due to the cost reduction associated with the hiring model.
Flexible and Secure
Another major benefit of IT Staff augmentation is its flexibility. It allows you to scale up or down the size of your team depending on the hiring needs. You can hire as many professionals as you wish, whether you need a single person to handle a particular project requirement or multiple employees to deliver an entire project. As a result, your business can undertake tasks of varying sizes or complexity, all while filling vacant positions in a matter of days.
Compared to other hiring models, staff augmentation offers better returns in terms of greater productivity as everyone in the team commits all of their effort towards completing a single task. Along with that, working with staff augmentation providers gives you better control of your project, as you get to set out the project’s guidelines.
Efficient Staff Management
Unlike outsourcing, staff augmentation gives you better control over the team and workflows. Instead of leaving the team management to the vendor, you are able to oversee the team, exercise authority over the workflow, and set the project’s guidelines. But that’s not the best part; keeping track of workflow and the team’s performance allows you to pivot your resources and redirect them to where they are needed most.
Focus on the Actual Professionals Instead of the Vendors
When choosing an outsourcing service, businesses tend to focus on their overall expertise and experience. Unfortunately, these two elements don’t necessarily translate to quality deliverables by the outsourced vendor. In this case, the best thing to do is to focus on the core competencies required to deliver the task at hand before selecting the vendor.
The staff augmentation model lets you handpick the right experts with the exact skills required to deliver your project irrespective of the company. As such, you can select five engineers from five different firms or partner with a vendor that can provide all five at once. Better yet, you augment the team within just a few days, as the vendors always retain pre-vetted employees waiting to be deployed.
Risks Associated with Resource and Staff Augmentation
Just like any other hiring model, resource and staff augmentation does carry some inherent risks and downsides. They include but are not limited to the following;
As indicated above, augmented staff are entirely managed by the outsourcing company and typically work offsite. For this reason, you need to establish an augmented communication, workflow management, and time management system. Worse still, you need to track the project’s timelines and all the risks associated with it, which require more managers to oversee everything.
Working with an augmented team essentially means introducing outsiders into your internal operations and systems. Wrongly managed and controlled, staff augmentation could lead to stolen intellectual property and even crucial customers’ information. To avoid this, you need to ensure that your company is protected by NDA contracts and regulations.
Communication plays a critical role when in offshore staff augmentation and nearshore staff augmentation. Generally, most vendors hire employees from around the world, meaning their work hours are based on their time zones, which more than often overlap. To avoid miscommunication or missed deadlines, you need to establish communication tools to keep everyone in the loop. Along with communication, you need project management tools like Trello, Jira, TeamClerck, and others to centralize and manage all your projects.
What’s the Difference Between Staff Augmentation and Outsourcing?
Technically speaking, staff augmentation is a form of outsourcing. In fact, most people tend to use the two interchangeably even though they aren’t synonymous. Basically, outsourcing entails hiring an individual or a company to deliver a project that could be done internally by an in-house team. For example, you may outsource web design, digital marketing, customer service, and so on. Staff augmentation, on the other hand, entails temporarily filling out an existing team with additional team members, often to deliver a specific project or goal.
Whilst outsourcing can save you money, it leads to minimal control over the team, and depending on your project, the final deliverables might not align with your expectations. Resource and staff augmentation let you incorporate another individual or team into your in-house team, giving you better control of the team and overall direction and implementation of the project.
As you can see, resource and staff augmentation is an intricate and well-oiled process that could be an excellent solution to get startups and small businesses up and running and competing with large organizations. On top of offering unmatched flexibility, staff augmentation will give you access to a large talent pool and save cost, irrespective of the size of your business.