4 Oct · 8 min read
In the modern digital age, numerous companies face business challenges in the form of staff shortages or unproductive hiring. This crisis, which is largely caused by the coronavirus pandemic, has encouraged many companies to modernize their business with new and non-traditional approaches, including outsourcing and outstaffing.
Outsourcing is thriving in the IT sector (in 2021 alone, the combined revenue of this model was 351 billion dollars), with staff augmentation contracts and dedicated team services being especially popular. If you’re interested in additional assistance but confused about the particular contract type you need, we can help.
External hires are brought in to compensate for any shortcomings and get the work done on time. While outsourcing has become the go-to choice for some companies, if you want more control over the work and to expand your team, you should consider trying staff augmentation.
This article will paint a full picture of staff augmentation, including how it compares to alternative models and how you can start applying it.
Staff augmentation is an approach used in project development that adds external specialists to a team for a limited time with the intention to speed up progress and save time/costs. This project is then developed internally, allowing the company to have more control over its flow and better integrate the temporary hires.
Sometimes, this arrangement is also called a distributed team, while other common names for it include team extension and business augmentation. Due to the ambiguity of the term, we recommend discussing the finer points of cooperation with a partner before making assumptions and signing any paperwork.
As an example of technical staff augmentation, let’s examine a company aiming to hire Angular developers. Their local talent market is pretty sparse, with the few available Angular specialists asking for astronomical salaries. They want more affordable candidates, but are hesitant about hiring from freelance websites.
So, what do they do? They find an partner who already has multiple specialists lined up. They just need to make sure the candidates are a good fit for team augmentation, sign some paperwork, and boom! Just like that, they have several new specialists working on their team after just a few days. And when the developers are no longer needed, they can be easily dismissed at any time.
It is important to clear up a common misconception about staff augmentation. Some companies classify it as a form of outsourcing and some as a form of outstaffing, creating a lot of confusion about the terminology. At Program-Ace, we classify it as outstaffing, and our experience has shown that it is preferred by companies that want to maintain complete control over the work of their team and have the resources to manage each individual specialist on a team.
At the same time, companies with very limited resources and experience find it easier and more useful to delegate all project work to an outsourcing firm, which surpasses them in these aspects.
We have already mentioned a few of the reasons why companies choose to augment, but there is more to look at, including some potential risks. Let's break it down, delving a little deeper into the subject.
Companies enjoy great flexibility
The contracts allow them to scale their project teams up or down quickly.
More skills to take advantage off
Businesses gain access to highly experienced professionals that raise the entire team’s quality of work and help internal specialists gain new skills.
The cost of employment is reduced
Not only do outsourced specialists offer better rates than most Western labor markets, but they don’t need to be kept on the payroll permanently.
Last but not least, the process of choosing a specialist and signing a contract is sped up exponentially when you have a partner with the people and paperwork ready to go.
While these challenges may pop up from time to time, you are unlikely to face them if you find a capable provider. Ideally, they will provide specialists ready to work in overlapping hours with your team, carrying a solid command of your language, and quick to adapt to new settings.
Given the surprising abundance of various outsourcing or outstaffing models, there is nothing wrong with comparing them and shopping around for types of staff augmentation and alternatives. Let’s see some matchups with the most popular alternatives to augmentation:
IT Staff Augmentation vs. Project Outsourcing
Project outsourcing is a rather general term that you might apply to a few models, but there is a major distinction with augmentation, having to do with where a project is developed. With classic outsourcing, the client delegates most (if not all) project work to specialists at another company and just keeps an eye on it. As for augmentation, it is more a matter of keeping work within the company but getting some extra help through bolstering your team with external resources.
Staff Augmentation vs. Dedicated Teams
A dedicated team is a model of cooperation that puts a lot of trust in an outsourcing partner, enlisting a whole team provided by them for current projects. The work is done externally (as opposed to staff augmentation), and the group works exclusively on the particular staff augmentation project assigned to them. The team can include a multitude of unique roles and the time that they stay at work can vary from weeks to years.
Staff Augmentation vs. R&D Center
R&D centers represent the largest and most ambitious form of outsourcing. Instead of fulfilling business needs by augmenting with a handful of experts, you almost open up a new branch of the company. Though this center is managed by a development partner and its workers employed there, everyone at this location is working on tasks from the original client.
Staff Augmentation vs. Independent Contractor
Independent contractors are sometimes considered the go-to choice for low costs because many of them offer affordable rates right out of the gate, and if they operate on a freelance platform, the process of signing an agreement is streamlined. However, the risks that come with this choice are substantial - contracts are very flimsy and unenforceable, and they simply don’t offer the same level of experience and resources provided by most augmentation firms.
Staff augmentation is a wonderful choice when you already have a solid foundation for project development - some senior experts, a proper project plan, and the financial resources to expand it. Thus, you can just get an extra boost of specialists that will fill in any gaps you have, especially if this is an extended team for startups. It is also a recommended option for those businesses that are unwavering in their priority of developing everything in-house.
The way staff augmentation is carried out varies from one company to another, but we can describe how we do it at Program-Ace.
First of all, we find a potential partner in need of outsourcing/outstaffing services.
We learn about the needs of the contacting company and tell them more about what we can offer. It is also at this point that both sides determine which model would work best for them - outsourcing or outstaffing.
When both sides are in agreement, we ink out the full details of this staff augmentation contract, finalize the deal, and the project is set in motion.
If the candidates that are to join the new team were not stipulated in the contract, they are now selected through interviews or other preferred methods.
During onboarding, the selected candidates are quickly brought up to speed with their project, acquainted with communication channels, and given the tools to start working.
Remaining in constant communication with their teammates at another location, our specialists work on the project, sharing their knowledge and expertise.
As your project evolves, the remote team can be scaled up or down at any time. Similarly, you can end the workers’ involvement at any time. We like to go the extra mile for our clients, and also offer post-release support and continued maintenance for projects that we helped advance.
For clients who already have a capable team and the infrastructure in place to oversee the core of project development, Program-Ace recommends a staff augmentation based approach.
A staff augmentation approach can hit the bullseye for your project if you already have a qualified team and the resources to expand it. Thus, you come to the matter of choosing new experts.
While there are hundreds of staff augmentation companies, few offer the level of experience and sheer quality of services offered by Program-Ace. Our company is a regular recipient of Clutch and IAOP awards, and a long-standing (27 years) leader in the field of B2B.
Unlike some smaller and newer companies on the market, we do not limit ourselves to one service or business model. Program-Ace’s vast experience (26+ years of operations) and large staff (120+ specialists) allows us to expertly handle projects with both types of models - outsourcing and outstaffing.
Even if you are not sure about the cooperation model best for you, it will be our pleasure to give you all the details and help with the choice. Want to learn more or get started? Send us a message today.