The digital age is changing all relationship patterns. And to build a successful business, it is essential not only to create electronic products, but also to use optimized management systems. The introduction of online advertising has increased the burden on company resources, and the digital transformation of the business requires a growing number of IT specialists.

The rapidly evolving market and ever-changing business models force us to look for new, flexible staffing solutions. These solutions allow us to save not only money, but also time and labor costs. Many modern companies have already come to appreciate one of these solutions - staff augmentation.

It should be noted that staff augmentation is not always a staff optimization solution, but often a necessity. If the company cannot minimize the work processes within the existing staff, then staff augmentation is a way out.

This paper is about the importance of staff augmentation, its advantages and disadvantages, staff augmentation services and the difference between this strategy and project outsourcing.

What is Staff Augmentation?

What does staff augmentation mean? Staff augmentation in this case is a type of staffing decision, one of the branches of the staff outsourcing strategy. This organizational strategy allows you to hire the staff quickly for a short or long period of time and manage the teams directly.

Simply put, this method allows you to quickly recruit staff for a specific project when there is a staffing shortage. The model successfully combines the benefits of staff outsourcing and the convenience of in-house staffing, allowing you to quickly fill the need for missing employees.

We can speak of short-term or long-term staff augmentation. Short-term staff augmentation is applied during peak season, holidays, vacation or sick leave when it is necessary to replace employees and keep productivity at the same level.

Long-term staff augmentation is used for more global strategic purposes. For example, when a company needs to hire additional specialists for a large project.

How does staff augmentation process work?
How does staff augmentation process work? 

Benefits of Staff Augmentation

Staff augmentation can come with a number of benefits. Here are a few of them.

  • Staff augmentation allows you to fill certain skill gaps. When the workforce lacks strong enough specialists in certain areas/technologies, employers often start selecting such specialists themselves.
  • Outstaffing reduces the time spent on selecting employees. Selection of employees is a lengthy and demanding process, and if it is delayed, the company inevitably starts losing money. A specialized company takes care of staff augmentation professionally - you don't have to spend your resources on recruitment.
  • Staff augmentation reduces recruitment costs. When a specialized company takes care of recruitment, costs are significantly reduced.

Find in the guide:

  • Offshore development rates by country
  • Time zone difference
  • Development rates by role
  • Operating costs are reduced. Permanent employees are much more expensive than those who work remotely. In short, staff augmentation allows human resources to be used in the same way as in-house employees, but without the cost of maintaining them.
  • Staff augmentation makes the recruitment process more flexible. You can quickly hire the right number of employees when you need them, without a lot of hassle. For example, it's convenient to run short-term promotions and advertising campaigns, complete urgent projects, or replace sick employees.
  • Staff augmentation allows you to think about the business and its development rather than the staffing routine. The outsourcing company takes over the entire responsibility of maintaining the personnel files for the provided employees. So, you don't have to worry about paying wages, paying insurance premiums, taxes, etc.
  • No geographical restrictions. The location of your employees doesn't matter, and qualified professionals can be hired anywhere in the world. You prioritize experience over residence address.

Pros & Cons of Staff Augmentation [Table]

Like any other organizational strategy, staff augmentation has its advantages and disadvantages. Let’s check them out.

Pros

Cons

Skilled and competent augmented staff can quickly understand and add value to the project.

Some projects may require a high level of contextual, institutional knowledge. So staff augmentation translates to lengthy ramp-up times and wasted costs.

Companies can pull in specific skill sets on a per-project basis rather than hire new employees. 

It is not a great solution for long-term projects or skills required on an ongoing basis. 

Staff augmentation helps to month out peaks and valleys in an enterprise’s journey.

There is an increased dependence on third-party organizations for talent, which may add some risk to sustainability plans.  

You can increase/decrease workforce on-demand, much in the same way that retail stores contract seasonal employees. 

Possible problems in communication between the company and the employee may occur. When all communication with an employee goes through an out-staffer, this can significantly slow down the speed of completing tasks.

Staff augmentation can be used as a ‘trial run’ for potential full-time employees. The staffing organization takes the hit in the case of the issue, rather than the organization. 

Coordination can be somewhat chaotic if people are not instructed how to deal with each other. 

Types of Staff Augmentation Services

Numerous companies offer staff augmentation services. Depending on the specific needs of your business, you can select the right one.


Description 

Talent types 

Best for 

Strengths 

Weaknesses 

Traditional staff providers 

Traditional providers of temporary labor 

Skill-based commodity 

All types of projects where a high level of skill is not required

Flexibility 

Sometimes it is difficult to find a highly-skilled talent.

Master vendor staff provider 

A single vendor runs staffing programs.  

Commodity 

Quick hiring need/bulk-hiring where low cost and scale are essential

Low cost

Scale  

Talent quality can be inconsistent.

Boutique agencies 

Small companies that focus on specialized talent

Skill-based

Highly-skilled 

The cases when you need exclusive needs

Quality 

High cost

Gig platforms 

Online resources with access to independent specialists 

Commodity

Skill-based 

Task-based needs for specific skill sets 

Flexibility

Quick hiring 

No recruitment hassle 

Quite difficult to distinguish the candidates. The talents are geographically distributed. 

On-demand talent platforms 

Online platforms with access to highly-skilled specialists  

Highly-skilled 

High-skilled talent deployed quickly. 

Flexibility

Quick hiring 

No recruitment hassle 

Talents are remote 

Independent contractors 

Independent contractors engaged directly by companies.  

Skill-based

Highly-skilled 

Needs that should be filled by known specialists.  

Quality 

It is challenging to find a reliable talent and keep relationships. 

Staff augmentation services are rather diverse and context-dependent. Evaluate your needs, budget, and degree of control you are ready to give away before making a decision.

Offshore Software Development Rates by Country: Detailed Guide 2021
Average Cost of Software Development by Country: A Detailed Overview

Staff Augmentation vs. Project Outsourcing

Both services seek to make more efficient use of their own resources, minimize staff costs and optimize taxes. But if staff augmentation is the integration of outside specialists into your company, outsourcing is the transfer of certain functions and business processes to a subcontractor.

An example of staff augmentation:

For a major international conference, the company needs to hire translators who will be engaged in translating all speeches and all materials. When the conference is over, there will be no need for such employees. Therefore, they are hired through an augmentation agency for a specific time.

An example of project outsourcing:

A large company (for example, a car manufacturer) does not create its own IT department for the development of multimedia software for its cars. They outsource this task to an IT company with expertise in this industry.

Both services imply the involvement of a contractor to solve specific business tasks. They help to optimize the company's turnover and costs, which increases the efficiency of the core business and accelerates its development. Based on the differences between outsourcing and staff augmentation, you can determine which models are best for your business.

How to find staff augmentation company?
How to find staff augmentation company?

Fulcrum Staff Augmentation Services

One of the essential requirements for successful staff augmentation is choosing a reliable provider. Fulcrum is your perfect choice to grow your team. It doesn't matter if you want to hire a few or dozens of developers, or maybe you are interested in QA gurus and other specialists.

Fulcrum is passionate about providing you with quality staff augmentation services. Rest assured that they will work on your specific project to achieve maximum productivity. They will manage the team directly, just as you do with your internal staff. If any issues or concerns arise, the team at HR will be happy to assist you.

Fulcrum – Top Development Partner in Ukraine by Clutch
Clutch ranked Fulcrum as one of the leading development partners in Ukraine for 2020. Proud to be Named a Top Development Partner in Ukraine by Clutch!

Conclusion

Staff augmentation is an effective model that companies across various industries use to respond to the organization's changing needs. It is an excellent solution to help the company optimize its business processes, reduce tax and personnel costs, and solve the problem of attracting qualified specialists for the projects.

Staff augmentation is especially relevant during a crisis when companies are forced to reduce staff to optimize costs. Evaluate all the strengths and weaknesses of the strategy and consider it to solve financial and personnel issues.

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Staff Augmentation FAQ

📍What is staff augmentation?

Staff augmentation is a type of personnel solution, one of the personnel outsourcing strategy branches, which allows you to hire the staff globally and manage the team directly quickly.

📍How does staff augmentation work?

There are different scenarios in which companies leverage staff augmentation - fulfilling a temporary spike in daily work, for longer-term needs, for out-of-house specialized skills, or building a team using entirely flexible labor as a way to get a competitive advantage.