Staff augmentation is a good solution for companies to reduce operating costs while maintaining productivity as much as possible. But before taking advantage of this service, you need to understand the definition of staff augmentation and its respective pros and cons.
In this article, we will be taking a look at the meaning of staff augmentation, its difference versus managed services, and its pros and cons. To start, what is staff augmentation?
What is Staff Augmentation?
Staff augmentation is a solution to onboard the skills your company requires at a lower cost via outsourcing. Your organization’s augmented staff will be managed directly by your company, as if they are your employees, but with significantly less costs and liabilities associated with hiring and maintenance. Usually, staff augmentation is used as a solution to fill in a temporary need for a specific resource.
Staff Augmentation vs. Managed Services
The difference between staff augmentation versus managed services can be explained using two factors: Control and Accountability.
With staff augmentation, you have full control over the tasks the augmented employee will do. Essentially, they will be like your own staff, so they may also require training in order to augment them into your company operations or project.
On the other hand, managed services involves fully outsourcing one of your department to a third-party organization. This means you will have little to no control over the recruitment and use of the staff. The benefit of this approach is it lets you focus on your company’s core competencies, while the managed service provider handles the day-to-day operations and management of staff.
Since you have full control in staff augmentation, your company is fully accountable on the performance of the staff augmented.
Versus managed services, accountability is placed on the managed service provider. Typically, MSP clients are protected by a service level agreement (SLA) that guarantees certain goals and objectives are met by the managed service provider.
Understanding Staff Augmentation: Pros and Cons
Pros of Staff Augmentation
1. Reduced Costs
Since most staff augmentation companies use resources from around the world, they are able to provide personnel at a significantly lower cost.
To give you an idea of the average savings that staff augmentation can provide, here are some of the positions and the associated savings we were able to provide to our clients:
- Help Desk: 46.14% Cost Savings
- Systems Engineer: 48.77% Cost Savings
- Software Developer: 52% Cost Savings
- Quality Assurance Specialist: 55% Cost Savings
In addition to lower salary costs, you will be able to save on expenses related to an office computer, equipment, and space since the staff will be working remotely.
2. Full Control of Staff
As detailed in the section “Staff Augmentation vs. Managed Services,” the staff will be essentially your own employee, which gives you full oversight regarding his/her hours, tasks, processes, and more. This lets you have as much control on the outcome of a certain task or project.
3. Increase or Reduce Staff On-Demand
Staff augmentation lets you easily add or cut resources based on your company’s requirements. For example, if you received a project that requires special skills exclusive to that project, you can temporarily add resources through staff augmentation and cut them once the project is completed. This method lets you scale your business in a less risky and costly manner since you are not hiring full-time employees.
4. Eliminate Recruitment Overhead and HR Management
With staff augmentation, the provider is responsible for the recruitment and HR management of the staff you require. This allows you to save on time and costs associated with recruiting staff and redirecting resources to more critical positions or HR tasks that your business needs.
5. Access to a Larger Pool of Specialized Professionals
Since most staff augmentation companies have branches around the world, you can have access to a larger pool of talent and not be limited to your area. This lets you hire specific or niche skills quicker and fulfill your requirements on time.
Additionally, cities and countries often have specialized skills they cultivate and promote, which provides you the option to find top talent on a specific ability or knowledge.
Cons of Staff Augmentation
1. Decreased Accessibility Due to Remote Staff
For staff augmentation to offer lower costs, providers leverage resources from countries that have a lower cost of living. For this reason, staff provided will be working remotely, which may not be as accessible versus someone working in the same office.
2. Potential for Miscommunication
Another con of staff augmentation is the potential for miscommunication. Although many countries can speak English, each country has specific dialects that may cause potential miscommunications.
To avoid this, it is recommended to have important instructions explained to ensure the message is understood. This will greatly reduce communication errors and potentially prevent wasted time.
3. Difference in Cultural Backgrounds
Lastly, different cultural backgrounds can cause potential hiccups since culture greatly influences how a person is effectively managed. History, religion, and language, among all factors, are some of the aspects that affect a person’s work habits and mindset.
We recommend learning and reading books and articles regarding how to effectively manage people from specific countries where your staff augmentation provider is located.
To summarize, staff augmentation is a great solution for companies to reduce costs while still having the necessary resources to maintain business productivity. Additionally, staff augmentation provides you elasticity to increase or reduce resources based on your business needs. Just consider that staff augmentation also has corresponding cons that, if mitigated, can bring significant efficiency to your business.
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