Staff Augmentation Explained: Is It Right for Your Business?

Business operations have never been more dynamic, and this trend is undoubtedly on the rise. To prevent their business from suffering, companies often need to react swiftly and decidedly in the face of challenges. This frequently involves finding the right skill set urgently to cover projects needs or address overall company requirements.

When this happens, hiring in a traditional way seems to be the go-to option; however, it often takes a lot of time and diverts the workforce which might be better employed elsewhere. Therefore, organizations are increasingly exploring alternative solutions, such as staff augmentation services. But, first things first: what is staff augmentation?

Staff Augmentation Definition

Staff augmentation represents a strategic outsourcing mode that avoids the long-term and financial commitments associated with traditional hiring. In short, staffing augmentation services offer a flexible solution that allows companies to quickly integrate external talent into their teams to cover skill gaps and project needs, on a temporary basis. Essentially, these augmented staff members operate as internal employees, providing the needed expertise while reducing costs and maintenance requirements.

Key Characteristics of Staff Augmentation

Control and Flexibility:

Unlike project outsourcing, staff augmentation lets companies maintain control over their teams, enabling them to direct projects according to their vision and goals.

Temporary Expertise:

Organizations can access expert talent for short-term projects through staff augmentation, avoiding the commitment of hiring full-time employees.

Cost-Effectiveness:

By leveraging external talent when needed, companies can save on recruitment, onboarding and employee benefits.

Quick Response:

Staff augmentation provides a fast solution to urgent skill gaps, minimizing delays in project timelines.

From these characteristics, it is obvious that in certain circumstances staff augmentation can be a far more convenient solution than traditional hiring. In the following section we’ll go into details and explain exactly how staff augmentation works, step by step.

How Staff Augmentation Works

When implementing IT staff augmentation, four steps ensure a smooth integration:

Step 1: Assessing requirements

Before taking any action, it’s necessary to identify the project’s needs and objectives. This lays the foundation for assembling a team of professionals with the right skills and proficiencies.

Step 2: Sourcing Expertise

Selecting suitable talent is probably the most important step of all, so it’s crucial for the company to partner with a credible staff augmentation firm. Not all companies offering resource and staff augmentation services are equal, so choose one with substantial experience and expertise.

Step 3: Integrating new talent

Once your team is in place, the focus shifts to clearly defining roles and responsibilities. A framework for transparent communication, continuous feedback mechanisms and an open dialogue are key for the smooth progression of your project.

Step 4: Providing continuous support

With everything set up, roles and responsibilities defined and open communication established, the only thing remaining is providing ongoing support. Even a highly talented workforce benefits from effective communication and leadership.

Which Companies Use Staff Augmentation?

Actually, it’s not about the type of company but rather the situations or scenarios in which there's a need for it. All kinds of companies leverage staffing augmentation, with the most common scenarios being:

1. Increased Capacity:

Temporary spikes in work volume, such as project work, increased production, higher customer demand or seasonal business workload spikes, often drive the need for resource augmentation.

2. Bridge to Hire:

Business augmentation becomes necessary when a company is hiring or replacing a permanent team, such as when establishing a new location or launching a new line of business.

3. Specialized Skills:

Filling short-term skill gaps is a common reason for staff augmentation.

4. Need to expand the team fast:

In situations where local expertise is scarce and time is of the essence, staff augmentation proves to be invaluable. It allows companies to quickly contact the vendor, review experts’ CVs and select the right people to boost their team and meet project deadlines.

Staff Augmentation vs Other Outsourcing Models

There are several outsourcing models similar to staff augmentation. Let’s observe them and understand what makes staff augmentation different from each.

Staff augmentation vs Independent Contractors

Staff augmentation has a vendor-driven approach, liberating businesses from spending time on communication, management and payroll responsibilities. Independent contractors offer direct hiring opportunities, freeing companies from vendor commissions. However, the competencies of individuals are not pre-vetted and it might take some time to sift through the candidates.

Staff Augmentation vs Managed Services

Staff augmentation places the client in the driver’s seat, maintaining full control over tasks and training, similar to managing an in-house team. In contrast, managed services involve the vendor assuming external control of non-core systems, providing little to no client control, but allowing focus on core competencies.

Staff Augmentation vs Dedicated Teams

With staff augmentation, the client directly manages remote workers with less vendor involvement. On the other hand, a dedicated team operates under the vendor’s supervision, often multitasking across several clients.

Staff Augmentation vs Offshore Development Centers

In the staff augmentation model, the client manages the team directly. However, with ODCs, the vendor sets up a representative office handling recruitment, office setup and other services as part of the client’s organization. A simplified parallel would be comparing building a home to renting an apartment.

As with any other model, staff augmentation has its pros and cons. Let’s explore them next!

Staff Augmentation Pros

• ‍Cost reduction: The primary and most apparent advantage is the ability to leverage global resources, potentially resulting in significant savings on salaries, office expenses, and equipment.‍
• Full Control: Augmented staff is there (temporarily) to be treated as your own employees, enabling full oversight on hours, tasks and meeting deadlines.‍
• On-demand Scalability: Staff augmentation allows companies to easily adjust their workforce based on requirements, adding and reducing resources as needed.‍
• Recruitment Overhead Elimination: Vendors handle recruitment and HR management, allowing companies to focus on core business functions.‍
• Access to Specialized Professionals: Businesses can tap into a global talent pool, breaking geographical barriers and gaining access to skilled individuals.

Staff Augmentation Cons

• ‍Potential for Miscommunication: Diverse dialects and cultures among global staff may sometimes lead to miscommunication. Clear instructions are needed to prevent errors in any setting, but they become crucial in the context of remote work. Needless to say, opting for on-site staff augmentation eliminates the potential for this problem.‍
• Privacy Risks: Working with a third party requires trust, alongside thorough security audits and robust Non-Disclosure Agreements (NDAs) to secure privacy protection.‍
• Managerial Bottlenecks: Efficient communication channels and process upkeep are needed to prevent miscoordination between in-house teams and augmented staff.‍
• Quality Control: While pre-vetted, it is beneficial to verify, from time to time, that your augmented staff isn’t underperforming, as this can lead to delays and a decline in quality.‍
• (Potential) Insufficient Technical Expertise: At times, augmented staff may turn out to lack the skills necessary for your project needs. However, working with reputable service providers minimizes this risk.

Categories of Staff Augmentation Models

There are three categories of staff augmentation models that a business may employ for specific tasks or projects:

Commodity Staff Augmentation

Commodity-based augmentation focuses on adding more staff to a business in a minimal period of time. It is especially suitable for scenarios requiring a quick influx of workers, or for positions that don’t demand highly specialized skills - such as basic factory work, events coordination, retail support and manual labor.

Skill-Based Staff Augmentation

This model comes into play when businesses need workers with specific skills that may not be highly specialized but are necessary for the task at hand. Examples include proficiency in typing, using spreadsheets or knowing a foreign language. While skill level is important, individuals in this category usually do not require extensive training or experience.

Highly Skilled Staff Augmentation

Highly skilled augmentation is reserved for demanding tasks that require skills developed through substantial training and experience. These individuals have expertise in areas such as software engineering, contract law or brand design.

Highly skilled augmentation further branches into short-term and long-term models.

Short term staff augmentation involves bringing in temporary employees for specific tasks or projects.

Long-term staff augmentation entails hiring individuals for extended periods, typically a year or more.

Types of Staff Augmentation Services

The categories of staff augmentation models we just discussed address the skill level and nature of tasks. But staff augmentation services can be divided into types, depending on the operational and logistical aspects of the way augmented staff is integrated with the existing teams or projects.

On-Site Staff Augmentation

This type of staff augmentation involves the recruitment of temporary professionals who work within your physical premises. It’s ideal for projects demanding close coordination, perfect team alignment and face-to-face communication.

Remote Staff Augmentation

As you’re probably guessing, remote staff augmentation entails hiring professionals who operate remotely. This type of service opens the door to a global talent pool and suits organizations and projects in need of specialized skills or cost-effective solutions. Effective communication and project management systems are crucial with this type of service.

Project-Based Staff Augmentation

Again, the title is self-explanatory: the focus of this type is a specific project or assignment, allowing businesses to leverage specialized skills without committing to long-term contracts.

Team-based Staff Augmentation

This type of staff augmentation involves hiring an entire pre-assembled team dedicated to a particular project or area. Ideal for situations where a complete team with a complementary skill-set is needed or when rapid scaling is necessary for time-sensitive projects.

Do You Need Staff Augmentation Services?

Before you go ahead and choose a staff augmentation model, there are a few things to take into account:

• ‍Assess the approximate timeline of your project - staff augmentation is an ideal choice for projects with a duration of less than six months.‍
• Calculate your costs - evaluate the expenses associated with training your in-house team to work with augmented staff. Make sure that communication and management processes are effective to realize the cost-saving benefits of staff augmentation.‍
• Make sure that your data is protected - consider the sensitivity of the data you’ll be sharing. It’s crucial to prepare a non-disclosure agreement (NDA) for your augmented staff to sign.

1. What is an example of staff augmentation?

An example of staff augmentation would be a software development company hiring an external team of programmers to assist with a specific project, on a temporary basis.

2. What is the difference between contractor and staff augmentation?

Contractors are hired directly by companies, they work relatively independently and their skills are not necessarily pre-vetted. Staff augmentation is vendor-driven: a company partners with a staffing agency that provides pre-vetted augmented staff and handles management, communication and payroll responsibilities.

3. What are the different types of staff augmentation?

There are three types of staff augmentation: commodity staff augmentation (non-specialized tasks), skill-based staff augmentation (specific skills, not highly specialized) and highly skilled staff augmentation (demanding tasks requiring extensive training and expertise).

4. What are the pros and cons of staff augmentation?

The pros would be cost reduction, full control on tasks and deadlines, on-demand scalability, flexibility and access to a global talent pool. The cons are potential miscommunication, privacy risks, coordination challenges and underperformance risks.

5. How much does staff augmentation cost?

The cost of staff augmentation depends on various factors: location, skill level, duration, type of service, agreement model, and quality of talent. While agencies may have different rates, a rough estimate suggests that staff augmentation could potentially save you around twenty to thirty percent compared to hiring in-house.