The talent crunch in the IT market has caused a severe skill gap and challenges for companies to find the right candidates. As a result, businesses are competing to hire and retain the best talent and provide high salaries and incentives.

But is it possible to stick to this strategy in the long run? The answer is no. Businesses are relying on outsourcing solutions like staff augmentation.

 If you are thinking about what is IT Staff augmentation meaning? and How does it work? and how you can hire offshore developers using the right augmentation model. This blog post will answer your every query. 

IT Staff augmentation services are the most cost-effective and flexible staffing solutions that allow enterprises to meet technical and industry-specific needs by outsourcing employees from outside.

 It is a powerful model that augments the agility of a company catering to the changing enterprise needs.

Are you a business looking for cost-cutting while maintaining the quality of your technical skillset then here is all you need to know:

“ Staff augmentation means an outsourcing strategy that helps businesses expand and augment their in-house team by hiring temporary employees from the outside ”

This model is also known as the resource and staff augmentation model. Staff augmentation is the savior for business leaders who are not very tech-savvy and wish to concentrate on the core business processes rather than hiring and retaining skilled talent.

 It provides the flexibility of immediately finding the right fit for your hard-to-fill positions, saving you from the hassle.

As per staff augmentation model it is a flexible, cost-effective component and strategy, specifically for start-ups in such scenarios. In-house recruitment doesn’t always work in cases where people with rare or specialized skill sets are required for time-bound projects.

Wondering which staff augmentation type would fit your business? Here are the types of IT staff augmentation model that might help you understand:

The IT industry is growing at an unprecedented rate. Revenue in the IT Services market is projected to reach US$1,204.00bn in 2023. 

The market’s largest segment is IT Outsourcing with a projected market volume of US$430.50bn in 2023. Revenue is expected to show an annual growth rate (CAGR 2023-2027) of 6.86%, resulting in a market volume of US$1,570.00bn by 2027.

This rapid growth in the IT market resulted in shortages of IT professionals and tough competition among businesses to attract employees. 

To solve this problem, Staff augmentation proved to be effective in addressing the problems related to skill gaps and distributing IT workforces among businesses.

The staff augmentation model is popular in the IT industry due for the following reasons:

• This model facilitates the hiring of vast software specialists. Businesses find it easy to augment resources from outside on a temporary basis rather than relying on the traditional method of recruiting in-house talent
• A Scalable workforce is another perk of the staff augmentation model. The IT industry is dynamic, and so are the requirements. Therefore, staff augmentation proves to be a flexible option in scaling up or down the teams as per the business needs.
• Hiring full-time employees can be risky at times like high turnover, less productivity, and cultural misalignment. These risks can be avoided with IT staff augmentation.
• Faster time to market, no fear of revenue loss, and agile and aligned teams are some other reasons which make staff augmentation so popular in the IT industry
• The HR and administrative burden are handled by the staff augmentation company. Hence making it easy for businesses to concentrate on the core aspects of the project.

Overall staff augmentation market size is growing and it is the ultimate solution for all staffing problems, talent shortages, skills gaps, high turnover, and a limited pool of candidates.

IT businesses these days are leveraging the benefits of this model like expertise, quick team scaling, flexibility, and cost savings, to bring value to their business.

IT Staffing services are an optimized outsourcing solution if used in the right circumstances. Here we have compiled some cases where staff augmentation services can prove to be beneficial, especially IT staff augmentation:

1. Filling Short-Term skill gap:

If you need to augment the in-house team for a specific chunk of the project or at the peak workload phase, staff augmentation is for you. With this model, you can avoid unnecessary long-term commitment and fulfil the temporary need.

2. Access specialized/ rare skill set:

Rare specialists like Scala Dev or Big Data developers are hard to find. Recruitment of in-house developers, either senior or mid-level, isn’t easy; staff augmentation helps in finding the right talent as the hiring is global and not restricted to one country or region.

3. Avoid high cost related to hiring in-house team:

Sometimes businesses try to avoid the cost related to hiring in-house hiring. HR and administrative costs related to hiring, training, layoffs can sometimes be an unwanted burden.

4. For quick scaling:

The IT landscape is dynamic. So, with the changing requirements of the project, you will need to scale up or down the team. In this case staff augmentation is a fast and flexible solution to scale the teams.

5. Maintain control over the project:

Each member of the augmented team is bound to report daily to the client. Staff augmentation helps businesses keep total control over the project to ensure the alignment of overall business goals and objectives.

If you have never used staff augmentation services, we have compiled a list of staff augmentation benefits and reasons as to why to opt for this model. Enhance your in-house talent with outsourced professionals and leverage the following benefits:

• Effectively Handle Workload:

It is not always feasible to recruit and retain permanent employees for short-term projects. But you cannot work with professionals either, missing some key skills. The best solution is staff augmentation, which helps you connect with experts externally and distribute the workload.

• Cost-Effective Solution:

Hiring local talent is always an expensive solution as compared to outsourcing talent as the company is liable to pay all the benefits along with the salaries. In the staff augmentation model, businesses only utilize the skills of the resources for a set period while the vendors take care of the rest. Also, businesses are liberated from the HR cost, or the burden related to recruiting, onboarding, training and managing employees.

• Find specific skill sets:

Staff augmentation helps businesses connect with the resources that are a perfect match for their project.

• Boost Productivity:

The staff augmentation model is adopted by almost every IT business as it improves the software development life cycle (SDLC) with the right team working on it. They can optimize the workflow by providing solutions that you couldn’t think of while working with your in-house team. Also, you have control over the entire project so you can manage the performance of the external team.

• Build an exceptional team and save time:

By adding outsourced professionals with a specific skill set, you save your existing team from acquiring those skills. Although some time is spent on onboarding these resources it ultimately saves save a lot of time during the actual development process.

A staff augmentation model provides resources on a client-need basis. IT staff augmentation model helps companies to fill the gaps in their teams by connecting with world-class talent. It is an effective way to expand the existing team and distribute the workload. Here we are sharing best practices of it staff augmentation and how the staff augmentation process works:

1. The first step is to identify the requirements of the project like scope, timeline and budget. Then the existing skillset is evaluated and the skills that are lacking are defined.
2. After this, a IT staff augmentation firm is chosen through thorough research, reviews, and interviews.
3. The resources are then on boarded as per your requirements to complement the in-house talent.
4. Integration of the resources happens to familiarize them with the in-house team and with the company culture.
5. The business manages the outsourced team and the resources report to an allocated project manager by the client.
6. The Staff augmentation services cost and liability of these resources either lie with the client or with the vendor, it depends on the staff augmentation contracts.

Staff Augmentation is getting more common day by day as it is helping businesses with most of the hiring challenges. There are some of the best practices to follow to make this strategy even more efficient:

• Strategy is the key:

Before opting for the staff augmentation model, it is necessary to strategically define your project requirements, goals, timeline and budget.

• Focus on quality over cost:

Staff augmentation is no doubt a cost-effective option. But hiring a staff augmentation company only because it’s offering low prices can become a problem. So, it is important to keep a balance between quality and cost.

• Due diligence is important when choosing the outsourcing partner:

To find the best augmentation agency, it is important to do thorough research. It not only helps you identify the right fit for your business but also saves you from problems in the long run.

• Communicate effectively:

Set a regular communication schedule and provide your team with the right communication and tools. This is the only way to avoid misunderstandings and conflicts.

• Transparency:

One of the major best practices in staff augmentation is transparency. It is important to build trust between the client and the staff augmentation company. It also results in better collaboration, helps mitigate potential risks, and works towards a common goal.

• Invest in training your augmented team:

Training the augmented team to fit the role required for the project is a very good move. This not only streamlines the development process but also helps you avoid tech debt. 

• Foster a collaborative Culture:

Fostering a collaborative culture among the teams and integrating the augmented team is very crucial for project success.

• Measure success:

To make sure the staff augmentation team is achieving its goals, it is necessary to measure and evaluate the success rate periodically.

Staff Augmentation vs Outsourcing these two different staffing solutions. Although both terms are often interchangeable there is a striking difference between both models:

There are several other options available for outsourcing Software Development services in the market which can be utilized as per different requirements of different projects. Here is a chart that compares these models with IT staff augmentation model in detail to help businesses make informed decisions. Let’s dig in:

IT Staff Augmentation

In IT staff augmentation the client retains control over the project and manages it. The augmented and resourced team works in close collaboration with the client’s team. It also provides flexible scaling of the teams. The resources are paid as follow:

• Hourly rate
• Fixed monthly rate
• Project based payment
• Single rate for the entire augmented team

VS

Independent Contractors:

As the name suggests, an independent contractor is a person, business, or corporation contracted to perform specific tasks or projects. They are not permanent employees and are hired when needed. The client is directly in contact with these contractors. They are autonomous and work independently. They are bound to deliver the project as per the contract but are free to manage the project and take decisions. Also, they have their own tools and resources.

Dedicated Development Teams:

IT staff augmentation and the Dedicated development team model are approaches to hiring external talent. But both have some striking differences. In this model, a completely dedicated team is provided to the client with resources having special skills. It is a long-term commitment, and the team has autonomous management. Also, the team doesn’t work as an extension of the in-house team, rather they work independently on the project and have their own team dynamics.

Staff Augmentation Vs Managed Services

What distinguishes staff augmentation from IT managed services is the degree of control over the project. The staff augmentation model works on providing the staff which is managed by the client. On the other hand, managed services are a holistic approach which means the vendor assumes all control of the external non-core business processes of the client and manages all the functioning.

Managed services better fit the scenarios where businesses seek to focus on core business and strategic priorities while handing over the resource allocation to the vendor. Moreover, the vendor already has their benches or teams so the project can start immediately after signing the contract, saving them from the hassle of onboarding new employees.

Offshore Development Teams:

Offshore software development is an outsourcing model in which the project is outsourced to an offshore development company located in another geographic region. It is a cost-effective option since the resources, even though highly qualified, are available at low rates. So basically, businesses can access specialized skills in budget. The resources are allocated and managed by the offshore development company.

IT Staff Augmentation Vs Time and Material:

IT staff augmentation and T&M are engagement models usually used for IT projects. The main difference between the two is the pricing structure and level of involvement of the client. The resources are paid for the actual time and material used for the project. The resources are managed by the service provider. The client only has the power of allocating the resources. Also, the client can make changes to the scope, deliverables and requirements throughout the project

Staff Augmentation Vs Project Outsourcing

In project-based outsourcing, an external vendor takes responsibility for the project’s completion. The vendor has more control and manages the project from start to end, even allocating the resources. It works on a fixed or variable pricing model based on the project requirement. The client pays the vendor for the whole project, not individual resources.

• Not finding the right fit:

Businesses may struggle sometimes with finding the perfect resources. This can lead to delays and frustration at the client end.

• No full control and dependence on vendor:

The project is owned by the client but supervised by the vendor. So, the company is dependent on vendors for the delivery of services.

• Communication issues:

In the staff augmentation model, the resources are located in other countries or at a different location than the clients. Hence miscommunication happens sometimes causing misunderstandings.

• Team merging issues:

Team integration may not always be seamless in staff augmentation. The reason could be differences in work ethic, cultural differences and personal values.

• Security Risks:

Resource augmentation means allowing resources from outside to access confidential data related to your business and project. It can be a risk to data privacy and security.

• Challenges related to contract negotiation:

Transparency and safety in client-vendor relationships can be maintained via properly assembled contracts. Poor contracts can lead to unexpected outsourcing bills and loss of control over the code quality.

• Unrealistic Expectations:

As the teams are working in different settings, problems like unrealistic expectations arise. Hence it can delay the project and increase the budget.

If the staff augmentation model is used in certain conditions, businesses can leverage the benefits in a true sense. These conditions are:

• To gain a competitive advantage by using flexible labor:

Staff augmentation helps businesses to boost the productivity and agility of the in-house team by injecting additional resources from outside. As a result, they get faster development process and speed to market.

• Need specialized skills on a temporary basis:

If at a certain stage of a project resources with specialized skills are required, companies can hire them from staffing agencies on a temporary basis.

• Bridge to hire:

The augmented team can be hired to keep your business operations going while you are looking for a permanent team.

• Distribute the temporary workload:

To increase the working capacity when the workload is at its peak, staff augmentation can be the right choice.

When the domestic talent pool is limited, businesses find it difficult to compete with the prices. Hence, they choose alternative methods like staff augmentation which is not only flexible but also budget-friendly.

Now the question here is how do you find the right staff augmentation company and build trust with it? Here is a systematic vetting process that will help you choose the best IT staff augmentation services company:

1. Research about the staffing company’s reputation and experience:

Before hiring a staff augmentation company, it is important to carry out thorough research about the company’s background and reputation. This is the only way to make sure that your staffing partner can provide the right talent and has experience working in the field required. These are some of the steps you can take:

• Read testimonials and reviews
• Contact previous clients if necessary
• Check portfolio
• Ask around through relative sources or employees

1. Vet the resources not just the vendor’s management:

Vetting resources beforehand is as important as vetting the vendor’s management. Most of the time the resources are switched, and another resource is sent for the job when the actual project starts. Therefore, it is necessary to interview the augmented team if you are hiring full-time employees

1. Clear and solid contract terms:

This is the foundation of a successful project. Make sure all the terms are clear and pre-decided to avoid conflicts later in the project. These are some of the basic terms that should be written:

• Clear identification of both parties involved
• Outline the services provided by the staff augmentation company
• Number and qualification of the resources provided
• Payment terms
• Termination terms
• Cybersecurity insurance
• Allocation of liability in case either party claims damage

1. Make sure the staffing partner can hire personnel irrespective of the location:

The staff augmentation company should have experience and means to hire resources from local as well as international markets. This is necessary as the project requirements may change at times. Also, make sure they can manage remote staff effectively.

1. Pre-decide communication protocols and delivery schedule:

Streamlining the communication protocols, channels and meeting schedule eliminates the risk of misunderstanding and miscommunication. So, make sure the staff augmentation values this aspect of the deal.

1. Consider the level of cultural and work ethic differences:

Why does team integration become a problem in staff augmentation? It is because either of the teams finds it difficult to accept the cultural and work ethic difference. So, the staff augmentation company should be capable of training the resources in this regard. Also being a client, you should also facilitate the vendor as much as possible in this regard.

As a leading Outsourcing Company, Opting for IT Staff Augmentation Services from CodeNinja gives you a lot of benefits. Let’s Discuss how you can scale up or extend your in-house team effectively and efficiently with CodeNinja. 

Broad Choice, Access to Special/Rare Skillset

Code Ninja gives you access to a vast pool of software engineers to hire with years of experience in handling offshore development, which is not the case with traditional hiring development agencies.

Only Trusted Developers

Developers go through a multi-stage screening process and the ones hired with a positive attitude are trained and nurtured in-house.

No Hidden or Additional Cost Incurred

Sourcing and interviewing resources is risk-free, you share developer profiles with their hourly rates stated, and you get a clear picture.

Scale Team

Startups or ambitious projects often scale as they grow, we allow our clients to ramp up their engineering capacity by adding more developers as they like to pursue.

Deep Sense of Inclusiveness

We don’t work in silos, with continuous feedback, and continuous development; we keep everyone in the communication loop, leaving little to no room for confusion and making everyone feel included.

No Need to Wait for Months

Hire instantly our pre-vetted software engineers and scale up your in-house team. Traditional hiring is time taking and slows your business growth ultimately.

IT Staff Augmentation is a valuable resource strategy for businesses that wish to overcome resource constraints and stay ahead of the curve. This model has helped a lot of companies leverage the power of augmented teams to enhance project outcomes and achieve their business objectives effectively.

Are you a business struggling to find the right staff augmentation partner? Look no further and contact us today.