Given how complex and time-consuming software projects are, the number of available and qualified staff is seldom enough. There is a constant need for manpower that can perform specialized services and make the project implementation faster and more efficient. This is the major reason why staff augmentation and outsourcing is extremely important for any IT business.
Because of their similarities, staff augmentation and outsourcing are often used interchangeably. Although they are used to achieve the same goals, they do not refer to the same thing.
In this guide, we would be exploring staff augmentation and outsourcing definition, the similarities between them, their differences, and the best choice to opt for.
What is Staff Augmentation and Outsourcing?
Staff augmentation involves hiring and using contractors or temporary workers to offer much-needed manpower and assistance to your permanent staff. Imagine a scenario where you need to meet a particular deadline, but have too few hands on deck to meet up, and can’t afford to hire any more permanent staff.
Or perhaps, you do not have the time to go through the rigorous process of hiring a new experienced hand. That’s what staff augmentation solves!
Outsourcing, on the other hand, is a business practice where one company transfers the responsibility of handling an internal activity or job function to another company. It sometimes involves the transfer of assets or employees from the hiring company to the hired company.
What is the difference between staff augmentation and outsourcing?
From the definitions above, it’s obvious that staff augmentation and outsourcing mean two different things. To make them clearer:
- For staff augmentation, the hired extra staff usually don’t spend a long time working, depending on the project. The length of engagement for outsourcing is typically measured in years.
- For outsourcing, the company where the job function is outsourced can afford to be located anywhere they wish, either on-site or off-site. While, for staff augmentation, staff that is contracted must reside within the company itself.
- Another difference between staff augmentation and outsourcing is on whom the responsibility of managing the staff rests. For staff augmentation, both the permanent staff and the hired staff are still managed by the IT department. For outsourcing, this responsibility is left to the discretion of the hired company.
Benefits of staff augmentation and outsourcing
- Staff augmentation allows a company to pick the perfect and ideal temporary staff with distinct skills on board with them. This allows the process of executing and implementing a project much easier.
- Due to lower rates of labor and economy of scale, outsourcing could also help to significantly reduce the costs of production for the company.
- Both staff augmentation and outsourcing could increase the flexibility of the company i.e. its ability to adapt and respond to business and market changes and leverage on this change for business growth.
- Outsourcing other functions enables firms to focus all of their resources on their core competencies.
In conclusion, staff augmentation and outsourcing are important solutions for businesses located in fast-paced environments to take advantage of. If you have to choose, the trick is to consider if your work and processes are well-defined and whether you are willing to give up absolute control over that process.
If yes, then you should consider outsourcing. If your answer is no, then staff augmentation might just be the right fit for you. If you are still caught between both choices, you can reach out to us here. Our team of experts will assess your business concerns and recommend the perfect solution for your firm.