Due to a lack of technical personnel, many startups and established businesses turn to offshore suppliers and remote engineers. Startups search for experts in various technologies who can handle specific activities and augment their in-house team’s overall skills. Simultaneously, businesses want complete control over their project’s resources, management process, and milestone delivery. There is some good news for these businesses: startup product development outsourcing is not the only game in town. Numerous IT firms are now using the staff augmentation strategy to accomplish less time and money. However, what is staff augmentation, and how does it operate exactly? If you’re asking the same question, you’ve come to the right place. We will be exploring all aspects of staff augmentation in this book, from what it is to how it works and its advantages.
Why are Businesses Trying to Implement Staff Augmentation?
The business sector is attempting to use staff and resource augmentation to acquire exceptional individuals without quickly jeopardizing profitability. It would help if you first comprehended what staff augmentation is; only then can you successfully form organizations and employ remote developers. The best approach to convey the notion of staff augmentation is to appreciate the demand of new and developing organizations seeking skilled professionals to manage particular operations perfectly, consequently enhancing the business’s functions. It may also understand the notion of staff augmentation by considering maintaining control of all operations when dealing with any resource allocation project, particularly when developers attempt to manage the process and meet milestones.
What is Staff Augmentation?
Staff augmentation is a kind of outsourcing cooperation in which highly trained workers are hired on a contract rather than permanently. In plain English, you’re acquiring highly trained and talented personnel from a staff augmentation firm that assists you in accomplishing all of your project goals. Staff augmentation has been a term in the IT sector for a long time since it enables IT organizations to expand their teams without incurring additional costs. Throughout the length of the project, the non-technical and technical resources collaborate with your internal staff. Additionally, they might work from their home or place of employment. Knowledge of the staff augmentation process flow helps in assessing existing team members. Additionally, it permits you to select whether or not to use an external resource. Staff augmentation has been a standard means of gaining a dedicated staff. Staff outsourcing, resource augmentation, full-time employee (FTE), project outsourcing, and resource outsourcing are synonymous concepts with minimal law, implementation, and cost distinctions. Many businesses use staff outsourcing to hire industry experts to satisfy their tough project needs and deadlines. It is a realistic option for individuals and companies that want to work on a project-by-project basis.
The Framework of the Staff Augmentation Platform
This term has been trending for many decades, particularly among dynamic company units. It has boosted the economic level of all organizations by allowing them to develop their stakeholder teams without incurring additional costs. The partnership is robust enough for marketing members and other commercial enterprises to use technological and non-technical resources. All of these tactics aid in recruiting internal resources and external developers throughout the length of the project. The recruiting members should have a comprehensive understanding of the staff augmentation process, which will enable them to evaluate the present members of the business’s team. Additionally, the staff augmentation process assists customers and other business needs by assessing the necessity for deployment services and other external sources. Staff augmentation is becoming a well-known platform for hiring committed individuals, and there are additional Outsourcing initiatives related to the foundation for working on execution and compliance.
How Does It Work?
To assist you in understanding how it works, we’ve broken down the full operation into the following fundamental steps:
- Determine Your Specifications
It is the first and most critical step that business organizations must take before hiring people. Two of these are beneficial in establishing the criteria and parameters for what the idea seeks. You must be able to identify the resources required for employing specialists precisely. All team members are continually involved in requirement identification to ensure no resource gaps in technical and non-technical assets for defining the candidate specifications.
- Review and Selection
It is the second step in appreciating the value of staff augmentation. The team members responsible for recruiting individuals for forthcoming projects may also take control of the process of assessing all job inquiries received and eventually analyzing the selection of prospects based on several criteria.
- The Onboarding of New Team Members
Because team members often make errors by signing a contract with the incorrect applicant, it is the job of the recruiting authority to monitor the integration of new team members into the company. All of the losses fall on the business, which becomes more difficult to handle in a short period. The four individuals must be very concerned with successfully integrating new members. Before executing the onboarding process, they must ensure that they give complete support for the successful integration of new members. Additionally, it would help if you had confidence in the contacts of all new workers so that the validation and verification of all papers can be legalized according to the company’s policies and standards. One should exercise caution in processing all regulations and guidelines within the allotted period to ensure that everyone becomes acquainted with one another’s assistance in the new job.
- Consistent Assistance and Nurturing
Once the integration process is over, you must continue to assist your new employees. Additionally, you must get their input and develop strong connections to enable successful and efficient collaboration.
Advantages of Staff Augmentation
- Increases the Duration of the Recruiting Cycle
Enlistment is a time-consuming procedure that might take months, perhaps longer, if you’re seeking applicants with exceptional and unusual qualities. However, with the assistance of staff augmentation firms, you may cut the time required for recruiting from months to weeks or even days. Augmentation experts maintain updated databases with a diverse pool of tech skills from which to pick.
It increases the likelihood that the augmentation company will discover you as the ideal applicant far faster than you would if you began the search on your own. It saves you a lot of time.
Additionally, the specialized team provider takes care of the following:
- Criminal background checks
It is an ideal answer for a technology scarcity that does not seem to be ending anytime soon. According to current projections, a global labor shortage of around 85.2 million workers is expected to exist by the end of 2030. It will result in an enormous $8.452 trillion in unrealized output in the United States alone.
- Cost Savings Associated With the Development
Now, you’re probably wondering how. Probably the most significant and apparent advantage of establishing a remote team is cost savings. Compared to the US and Western European nations, if you attract resources from Eastern Europe and Asia, they will seek cheaper compensation due to lower living costs in those countries. It will result in enormous savings. Additionally, you are well aware that the cost of recruiting in-house personnel in the United States is fairly high, which includes additional expenditures for taxes, employee benefits, and social security, among others. There is a significant difference compared to deploying staff augmentation services from Eastern Europe and Asia. Wages are lower. Even other expenditures like equipment, office space, and taxes are reduced. The bottom line is that outsourcing staff augmentation is the most effective strategy to limit development expenses.
- There are Fewer Legal Complications
Hiring individuals entails many paperwork and legal duties, including payroll, taxes, and employee benefits. When you use staff augmentation, on the other hand, the outsourcing business serves as the employer and is responsible for all of the above-mentioned legal duties and paperwork.
- Overcoming Geological Limitations
Numerous technology startups are having difficulty securing the necessary resources at the right pricing on a local level. Staff augmentation provides a comprehensive answer to this issue by allowing you to look for required professionals situated in many countries without having to hunt for them physically. It connects you directly to professionals who may not be available in your area or nation.
- The High Degree of Adaptability
Staff augmentation is critical in offering flexibility for IT startups. Startups should not be afraid if an unforeseen demand occurs as they can add extra staff with the right competence in a few days. Additionally, entrepreneurs may scale up or down in response to their current needs. As a result, they are not bound to staff who will not be necessary for months.
- Sustained Authority
While companies use their hired expertise, staff augmentation allows them to retain control over their management and work. The full project’s work is transferred to an external entity in project outsourcing. However, with staff augmentation in place, firms may retain control over human resources by contracting with an external agency. Staff augmentation provides businesses with managerial control, allowing them to create the project in the manner they wish. Historically, project outsourcing aimed to reduce the parent company’s involvement in the execution and administration of the project. However, staff augmentation avoids this anomaly by allowing parent enterprises to make the ultimate decision.
- Expansion and Adaptation
Businesses often seek to grow their operations by capitalizing on current market circumstances. However, the accompanying risks and likelihood of failure often dissuade organizations from taking such initiatives. Staff augmentation is beneficial to these types of organizations. Businesses may now use flexible hiring to grow their operations on a trial basis without investing in a full-time crew. It promotes businesses to evaluate their acceptability in various sectors via project-based recruiting. Apart from growth, flexible staffing helps organizations adapt to the market’s inconsistency. With the market changing daily and millennials obtaining new abilities, businesses must continually innovate to survive. Staff augmentation emerges as an efficient technique for accomplishing this goal because it allows organizations to adapt quickly to changing market circumstances using project-specific staff.
- Leverage New Concepts
If you retain a small group of workers for an extended time, you risk opinion stagnation and a lack of originality. It may be a significant impediment to the development and expansion of your firm. Successful and changing businesses need novel approaches to maintain their success.
Staff augmentation encourages businesses to collaborate with a broad group of professionals rather than run with repeated ideas. Through project-specific employment, businesses may tap into a pool of fresh ideas and concepts that can help them improve their company operations.
Disadvantages of Staff Augmentation
- Accessibility Impairment as a Result of Remote Staff
Providers employ resources from nations with a lower cost of living to provide lower-cost staff augmentation. As a result, the staff will work remotely, making them less available than someone who works in the same office.
- Possibility of Miscommunication
Another disadvantage of staff augmentation is the possibility of communication breakdown. While many nations speak English, each country has its dialect, resulting in miscommunication. We must give critical instructions in detail to ensure the message is comprehended to prevent this. It will significantly decrease communication mistakes and may even avoid time being lost.
- Differing Cultural Origins
Finally, cultural differences might create stumbling blocks since culture significantly impacts handling a person. Among other elements, history, religion, and language all affect a person’s work habits and thinking. We advocate educating yourself and reading books and articles on handling employees from countries where your staff augmentation supplier operates efficiently.
Key Things You Must Know About Staff Augmentation
Consider some critical characteristics of the staff augmentation concept.
- The Protection of Intellectual Property Using Nondisclosure Agreements (NDAs)
You must execute a nondisclosure agreement with the staff outsourcing provider to preserve your intellectual property rights. Additionally, you must keep in mind that as your remote workers become full-time developers, they will access secret information. As a consequence, you must ensure that they do not misuse it.
- The Outsourced Organization Employs Remote Developers on an Official Basis
However long the remote developers work for you, the outsourcing company will always be considered the remote developers’ official employer in the eyes of the law. Because of this, it is necessary to clearly define each party’s areas of responsibility in the contract and ensure that all parties agree on working conditions, such as the number of vacation days and sick days to be granted.
- A Monthly Cost That is Transparent
You should pick an outsourcing business that charges a single monthly rate for each developer. The charge should include the developer’s real compensation and the service provider’s commission.
Concerns About Staff Augmentation, as well as Strategies for Overcoming Them
While staff augmentation provides various benefits over in-house employment, you may still have some reservations. We’ve identified three typical concerns you may have and provided tried-and-true solutions to help you overcome them.
English and Communication Abilities are the First Obstacles
When hiring engineers via staff augmentation, the communication quality with an engineer who works from a distance, on a different continent, or in a completely different context may be a source of worry. Meanwhile, several firms and startups have benefited from the staff augmentation approach. How are they able to achieve this? They use caution while selecting suppliers.
Effective communication with a staff augmentation provider is contingent upon experience. The longer a development organization has operated in an international market, the more straightforward it will be to build successful communication. Additionally, the quality of communication is location-dependent. For example, more than 70% of software engineers in Ukraine possess verified intermediate or higher intermediate English skills. More than 12% of IT workers, predominantly project managers and scrum masters, possess advanced English skills. By carefully selecting an outsourcing location and provider, you may avoid communication-related risks.
How can you deal with colleagues who begin their workday before completing the activities on your daily schedule? How can you resolve problems if your partners are unavailable when detected?
While differing time zones may seem like a disadvantage, this disadvantage might benefit certain circumstances.
In this example, the answer is found in making the appropriate destination selection. A little time difference (three to five hours) will provide no difficulty. Simultaneously, you may use a five- to ten-hour time difference to your team’s advantage. You may establish a pleasant work procedure and conduct daily standups conveniently for the whole team when you hire engineers from Ukraine. Daily standups enable you to maintain contact with engineers, align your vision, goals, and responsibilities for the next day, and address any potential difficulties or queries.
CTA: Are you interested in establishing an efficient work process within your augmented team? Allow us to share our industry’s best practices with you.
When your engineering team is geographically dispersed, you may have concerns regarding the outcome. Will they provide the functionality that they discussed at the kick-off meeting? Is the project’s final version consistent with the original requirements? And how much longer will it take to deploy the app with a dispersed team? These and many other questions may arise. Fortunately, there is a way out.
The first step in achieving exceptional outcomes is thorough, accurate, and unambiguous documentation. If you have a project requirements document, double-check it and consult your augmented team. If you do not currently have one or your project’s requirements are incomplete, you may work with our professionals to create a new or enhanced version of your requirements document. Increase the effectiveness of well-written documentation by holding daily meetings to maintain tabs on the current scope of work. Additionally, you should create timelines, sign nondisclosure agreements, develop effective communication, and schedule daily meetings to communicate the project goal to your internal colleagues and external experts.
Staff Augmentation vs. Managed Services
Two elements explain the distinction between staff augmentation and managed services: control and accountability.
With staff augmentation, you retain complete control over the duties performed by the enhanced employee. They will function similarly to your staff and may need additional training to integrate them into your company’s operations or projects. On the other hand, managed services entail completely outsourcing one of your departments to a third-party business. It implies that you will have little to no influence over the staff’s recruitment and utilization. Using this strategy, you may focus on your company’s core competencies while the managed service provider handles day-to-day operations and personnel management.
Because you have complete control over staff augmentation, your organization is liable for the performance of the augmented staff. In comparison to managed services, the managed service provider is held accountable. Typically, MSP customers are covered by a service level agreement (SLA) that ensures the managed service provider meets specified goals and objectives.
We can say that staff augmentation is an excellent way for businesses to save expenses while maintaining the resources essential to sustain corporate efficiency. Additionally, staff augmentation enables you to adjust your resource allocation to changing business demands.