In the fast-paced world of business, companies are increasingly turning to outsourcing. While recruiting, onboarding, and maintaining an in-house team is too expensive, outside help is a great solution for fast and professional project management. When resorting to this cooperation model, employers face a choice: staff augmentation vs managed services.
Both models allow you to unload your team and delegate work within the company. However, which option is a perfect match for your crew? In this article, we’ll examine the pros and cons of staff augmentation and managed services, compare both models and determine the most relevant solution for your organization.
To begin with, let’s understand each model of cooperation.
Staff Augmentation Meaning
Staff augmentation is outsourcing in which an organization engages specialists to bolster and expand its team. In simple terms, when you feel that your in-house crew’s capacity is insufficient, you can resort to external temporary help.
Unlike full-time hiring, this model does not require lengthy recruitment and onboarding processes. In addition, this approach is cost-effective. Most often, it is a temporary solution for short-term productions. It applies to various tasks, from development to quality control. An external specialist helps to close burning issues, replenish skills that are lacking in your employees, and complete the work on a deadline. As a result, you get a quick and high-quality outcome without breaking the bank and wasting precious time.
How Does Staff Augmentation Work?
Staff augmentation is quick and easy given the urgent need for companies to expand their crew. For example, our company works according to the following scheme:
- First, you should define your needs and requests regarding skill sets, terms of cooperation, and other issues. Following your wishes, we find relevant candidates, screen their resumes, and arrange interviews to determine the perfect fit.
- Then, you meet with the selected candidates to evaluate them from your side and make your choice. After signing an agreement, you may start direct cooperation.
- Finally, you familiarize the new member with your workflows and assign the workload. Share your vision, train, and monitor tasks to get the most out of your new talent.
Staff Augmentation Pros and Cons
As you see, this outsourcing model is about quickly ramping up a crew. It comes in handy when your skills or assets are not enough to complete a project on time. However, like any cooperation, staff augmentation has its pros and cons. Let’s look at both sides.
Advantages:
- Global expertise. You get access to the best specialists around the world. Thus, you can strengthen your team with talented experts and gain unique market knowledge.
- Fast onboarding. The adaptation of the involved members is faster than with traditional recruiting. For example, you skip a probationary period, and can immediately move on to more crucial tasks. In addition, you don’t need to train employees because they already have the skills you need.
- Flexibility. You may adjust your team to suit your requirements. This way, you expand or reduce your crew whenever you need it.
- Cost-effectiveness. Expanding staff significantly reduces investments compared to traditional hiring. So, you save money and may direct them to your business development.
- Strict compliance with deadlines. Additional resources help complete projects on time and with high quality. If you have pressing issues, additional labor is the best solution to get the job done without being overwhelmed.
Disadvantages:
- It’s not the best option for long-term projects. Staff augmentation is typically used for short-term tasks when you need to get the job done quickly. As for long-term offers, it may be costly. In such cases, it is better to choose an in-house team.
- Needs your management. New employees will need to understand your business processes and routines. So, you have to organize the workflow and interact with new employees. Otherwise, you risk getting chaotic execution of assignments that are difficult to integrate with your goals.
Where to Use Staff Augmentation?
There are two types of staff extensions. Depending on them, the model is used in different cases. Let’s take a glance at each one.
Short-term
Companies may use outside assistants when their in-house team has a high workload or cannot operate at full capacity. Most often, this happens in the following cases:
- sick leave;
- vacation.
Long-term
It is a relatively long-term cooperation when an employee is needed to complete a project. In this case, employers resort to outsourcing to meet such challenges:
- fill in the missing skills;
- quickly find an employee without long recruitment;
- reduce costs compared to full-time employment.
What Are Managed Services?
Let’s move on to the second model to understand all the pitfalls and benefits. Managed services is a type of outsourcing where a firm delegates certain responsibilities to a third-party provider. The algorithm looks something like this. You find a company with relevant experience. It may be software development, customer care, or something else. Next, you agree on the requirements, prices, and deadlines. After that, the team deals with the task independently, without involving you in the workflow.
We recommend using this option if you are looking for long-term cooperation and can fully entrust the workload to third-party employees. It is cost-effective, as it does not require additional costs for crew maintenance and has a fixed price.
However, be careful, as managed service providers are exposed to the outcome of the entire project. If you choose the wrong company, you risk experiencing malfunctions in certain processes, which affect the result of your campaign.
Managed Services Advantages and Disadvantages
Here’s a list of the main points that customers pay attention to speaking about the benefits and shortcomings of this outsourcing type.
Pros:
- Skills and experience. Providers have deep expertise in a particular area. In addition, they have experience with many similar assignments. So, they handle the process efficiently and professionally.
- Cost-effectiveness. This model implies a fixed price for the project running. Moreover, you don’t have to worry about purchasing software or training your team. It significantly reduces costs.
- The ability to focus on your business. Since service management organizations offer full production running, you devote yourself to more important tasks. At the same time, we recommend introducing weekly or monthly check-ins to monitor the proper completion of the assignment.
Cons:
- Security. By entrusting your workflows to third-party teams, you run the risk of leaking confidential business data. To avoid this problem, we advise you to carefully check your partner’s contract and privacy policy before dealing with them.
- Lack of communication. Since the company will deal with the assignments independently and independently, you will hardly ever cross paths to discuss the details that emerge. It leads to misunderstandings due to different visions of a particular task.
- Possible conflicts. Most often, companies cooperate with offshore service providers. There is a possibility that your project will go to one of them. It can cause long lead times, difficult communication, cultural compatibility issues, or other stumbling blocks.
Difference between Staff Augmentation vs Managed Services
We have collected all the information and created a comparison table to help you easily determine staff augmentation VS managed services.
| Criteria | Staff Augmentation | Managed Services |
|---|---|---|
| Flexibility | High flexibility in scaling the team up or down based on specific needs. | Flexibility depends on the terms of the service level agreement (SLA). |
| Cost Structure | Typically involves hourly or daily rates. | A fixed monthly fee or a cost based on usage. |
| Integration | New members need to integrate with your existing processes, tasks, and members. | MSP operates independently, with minimal integration required. |
| Duration | Often short-term, project-based engagements. | Usually, long-term contracts, focus on ongoing support delivery. |
| Communication | Direct communication between client and augmented staff. | Communication is managed through the MSP’s designated contact points. |
| Project Types | Software developmentIT supportMarketing campaignsEngineering Data analysisShort-term consultancy | IT infrastructure managementNetwork and security CloudsHelpdesk supportBusiness process outsourcingOngoing IT support and maintenance |
What to Choose: Staff Augmentation VS Managed Services
When choosing IT management services vs. staff augmentation, it is important to consider the features of both models. In addition, you should define your requirements and set specific hiring goals. Here are a few steps that will help you decide on the right option:
- First of all, define your goal and what you need help for. Do you want to delegate the duties of an absent employee or need a team that will perform certain tasks in the long run? Decide on the key details to move forward.
- Determine your budget. How much are you counting on and what payment model is more convenient for you: hourly rates or a stable cost? It is important and can play a decisive role in choosing a cooperation model.
- Assess how important communication and personal monitoring are to you. We recommend choosing augmentation if you want to interact with the team and personally control the operation. If you are ready to entrust the assignment to a provider and focus on other deals, consider the managed service model.
Final Thoughts
To sum up, outsourcing is a good solution for companies that want to unload their in-house team, decrease costs, and get high results. When selecting between staff augmentation vs managed services, consider your needs and expectations from cooperation.
If interaction with the team and control over the result are important to you, we recommend choosing staff augmentation. It allows you to find talented professionals with exactly the skills you need. Contact us if you are looking for your ideal team to consider the available options.
