Think about the senior developer who is about to go on maternity leave for a few months or the project manager who has a magnificent idea for a product but doesn’t have access to certain expertise. What would you do?”
As businesses increasingly tap into technology to improve efficiency and productivity—IT departments find themselves with ‘holes’ in their team that require a temporary fix.
This post examines one popular solution—IT staff augmentation. We’ll look at when it’s ideal to take advantage of it vs when it isn’t. We’ll explain how it works in its variations, how it’s different from other staffing services, and how to get started.
What Is IT Staff Augmentation?
It’s a business strategy that uses on-demand, outside personnel to temporarily fill talent gaps and staff a project. Staff augmentation is also known as outstaffing and team extension.
How Does IT Staff Augmentation Work?
The need for staff augmentation starts with an IT project:
- Building an online store
- Creating a website
- Designing a mobile application
- Securing information
- Migrating to the cloud
- Testing software
- Collecting and/or analyzing data
- Automating processes
- Creating tailored software to improve your efficiency in financial, marketing, customer service, etc.
Companies should first evaluate their project and take into consideration their existing/available talent. Next, they must determine the required skills or professionals they are lacking to successfully complete the project.
Rather than hiring for the professionals they are lacking, the company contacts its staffing partner, whether it’s a vendor, a specialized remote team, or a freelancer.
Let’s See an Example
Imagine an e-commerce brand is remodeling and updating its online store. The e-commerce company in this example has its own IT department and web developers but they’re lacking a quality assurance engineer. So, they contact their staffing provider who offers on-demand QA services.
The e-commerce brand will participate in the process by selecting, from the remote team’s candidates, the quality assurance engineer they’ll be working with.
The QA engineer then works remotely, integrating as a part of the e-commerce company’s in-house team under their management.
Staff augmentation is similar to hiring an employee but without the in-house recruitment hassle and the long-term commitment. The e-commerce company will not be responsible for the QA engineer’s benefits package, 401K, health insurance, or ongoing training.
When the web app remodeling project wraps, the contract is finished, and the e-commerce company that no longer needs a QA doesn’t have to worry about letting anyone go. The engineer remains employed by the vendor and will move on to the next short-term project they’re assigned elsewhere.
Types of IT Staff Augmentation
There are different staff augmentation models that can help companies fill tech talent shortages:
- Vendor Staffing Providers – These are your large-scale staffing organizations, like Manpower.
- Specialized Staffing – Specialized staffing is more of a boutique experience. These are agencies that hyper-specialized to guarantee the best professionals in that area.
For IT staff augmentation, this kind of third-party partnership is ideal. A web design company, for example, can form a partnership with a remote team specialized in web application development. Nativo is an example of an IT staffing organization specialized in mobile applications, web development, and quality assurance.
- Independent workers/freelancers – With LinkedIn and online platforms like Upwork, connecting with freelancers has never been easier. The downside is the lack of supervision and the quality of a freelancer’s work can be unpredictable if you’re conducting the selection process without first-hand references.
Staff augmentation is not the only third-party IT staffing option. To avoid any confusion, let’s see how staff augmentation is different from the per-project model and managed services.
Staff Augmentation Vs Per Project
IT per project, also known as IT project outsourcing, is a business strategy in which a business hires a tech company to complete a tech project, end to end, externally.
For example, a software development firm obtains a contract to create a mobile application. It’s peak season and the software development firm doesn’t have the bandwidth for a full project, nor do they have the time to hire and train new developers.
Instead of turning down the project and potentially losing a client, the software development company can hire a third-party, remote development team. The remote development team picks up the project and carries it out, turning in the finished project to the software company.
Staff Augmentation Vs Managed Services
Staff augmentation is the temporary incorporation of outside specialists into your internal team and per project means receiving finished dev projects from an outside team
But managed services are a long-term solution. It’s the constant delivery of services, usually a whole process or system.
For example, many companies use the managed services model to permanently outsource their cybersecurity and support services (call centers and tech support).
When to Use and Not Use IT Staff Augmentation
Businesses can take advantage of IT staff augmentation in diverse scenarios. Let’s begin with the situations in which you may want to seriously consider staff augmentation.
When to Use IT Staff Augmentation:
- When You Need to Access Specialized Skills and Experience
It’s difficult for small to midsize companies to employ a full staff of experienced tech experts that can tackle any project in any programming language. Even larger companies with a full IT staff of experts occasionally need outside hyper-specialized experts that can provide consulting services.
IT staff augmentation offers the flexibility to take on development projects despite limitations.
- When You Need to Respond to Temporary Spikes in Workload
Many businesses see seasonal spikes in their workload which means they turn to seasonal hiring. With staff augmentation, companies can have the support they need for the duration of the peak season, without the uncomfortable dilemma of letting anyone go when the workflow subsides.
- When You Need to Complete a Short-term Project Outside Your Core Competencies
No matter the industry, all modern businesses rely on technology and most will undertake one new tech project, if not several, in the next few years.
Imagine you have a chain of restaurants and you want to create a mobile application to improve customer engagement and communication. Because of the industry you’re in, you don’t sustain a full-time, fully-staffed tech team.
In this case, rather than hiring, you can supplement your existing tech team with additional experts using the staff augmentation model. Another team ‘loans’ you developers, engineers, analysts, support, and specialists so you don’t have to go through the recruitment process just to accomplish one project.
- When You Need to Fill Talent Gaps in between Full-Time Staff
IT staff augmentation can be used if a business requires an extended period to hire for a hard-to-fill position or cover a team member on maternity leave.
According to the U.S. Bureau of Labor Statistics, the growth rate for software developer positions will grow 22% by 2029. That’s 18% higher than the average growth rate for all occupations in the U.S.!
Software also has a high turnover rate, 13.2% per year on average in the U.S., according to a study conducted using LinkedIn member data.
With high demand and high turnover, tech positions can be some of the most difficult to fill and retain, especially for small to midsize enterprises that can’t always keep up with the benefits packages offered by larger companies. IT staff augmentation can be a smart, cost-efficient solution to the talent shortage.
- When Cost-Savings Are Also a Priority
Outsourced IT services on an as-needed basis are often more cost-efficient than permanently maintaining a large in-house IT department. This is because outsourcing models allow businesses to pay for the service on-demand, and therefore sidestep the continuous costs (direct and indirect) that in-house staff require, like benefits packages.
Deloitte’s 2020 Global Outsourcing Survey found that the Covid-19 crisis has caused companies to prioritize cost-efficiency and 70% of the executives interviewed cited cost reduction as their main reason for seeking strategic partnerships with staffing service providers.
When NOT to Use IT Staff Augmentation:
Naturally, when businesses hear that staff augmentation can help cut costs, they begin to explore the idea, especially in a Covid-19 context. However, IT staff augmentation is not necessarily a magic cost-saving model. The decision must be made under the right circumstances.
Perhaps IT staff augmentation *isn’t* the right strategy for your company in the following two situations:
When You Have the Resources to Complete the Project
If you already have professionals on staff who possess the time, experience, and skills to complete the task at hand, it’s not necessary to use staff augmentation. And you should conduct a cost-benefit analysis before committing.
When What You Really Need Is a Long-Term, Full-Time Team Member
IT staff augmentation is something that is meant to be temporary (3 months to 2 years) and cost-efficient.
If your company is growing, tech projects are coming in steadily, and you foresee needing a full-time QA from now to eternity—hire a QA!
Of course, you can use IT staff augmentation for your QA needs for a specific project, or as a fill-in, while you hire your QA engineer.
How to Start Using IT Staff Augmentation
If you’ve never used a staff augmentation service before it’s understandable that you’re not sure where to get started.
Getting started can be time-consuming but it’s pretty straightforward:
- Understand the model you need. Is staff augmentation the right answer? Or are you really looking for per project or managed services?
- When staff augmentation is the right answer, which type of staff augmentation will you be using—a vendor staffing provider, specialized IT staffing, or a freelancer?
- List your project requirements. Understand what exactly you’ll be needing from a specialized staffing service.
- Prioritize your preferences. What’s important to you: Price? Quality? Years of experience? Transparency? Nearshore? Local?
- Prepare the questions you’ll want to ask through the vetting process. Just as you’re strict when hiring, you want to be equally strict when choosing a staffing partner
Begin researching and contacting IT staffing service providers for a consultation
The IT Staff Augmentation Vetting Process
The key to successfully outsourcing is putting candidates through a strict vetting process. You will want to carefully sift through your candidates to avoid the infamous ‘over promise and under deliver’ hazard.
Shift your focus to the candidates who share your values and understand your business goals.
Companies looking to implement a staff augmentation model must ask their candidates exhaustive questions about talent acquisition, employee retention, transparency, process monitoring, documentation, reports, communication channels, tools, and ethical sourcing. Ask, how do they handle developers that aren’t delivering quality?
IT Staff Augmentation and Nearshoring
One of the reasons why staff augmentation can help businesses fill tech positions faster is because IT staff augmentation lets you reach across borders and draw from a much larger pool of qualified candidates all over the world—whether it’s a freelancer in Canada or a remote dev team in Nicaragua.
If you decide to open your search to options abroad, consider practicing nearshoring, a model in which remote professionals provide their IT services from a geographic location that is relatively close to their clients.
An example of this would be when a company in England needs a systems analyst so they partner with a specialized staffing team in Poland who can provide that—Poland being geographically closer than, let’s say Brazil or Australia.
Many companies that outsource have begun to prefer nearshoring because having a service provider relatively near offers its benefits:
- Site visits are more convenient
- There may be fewer marked cultural differences
- Similar time zones facilitate real-time communication
Reducing any potential cultural friction and communicating in real-time helps speed up time to market. This is why we see more and more U.S. and Canada-based companies partnering with tech teams in Mexico, Central America, and South America.
You can find IT staff augmentation services through large-scale staffing organizations, specialized service providers, or freelancers.
IT staff augmentation can be an opportune staffing strategy when your business falls into any one of these 5 categories:
- You need to access specialized skills and experience
- You need to respond to temporary spikes in workload
- You need to complete a short-term project outside your core competencies
- You need to fill talent gaps in between full-time staff
- When cost-savings are also a priority
That being said, the last point, cost-savings, is not reason enough alone. Be sure to conduct a cost-benefit analysis. When you have the resources, available talent, and time to carry out the project, you could actually save by completing the project in-house.
Lastly, you must be prepared to put time and effort into the vetting process before selecting a partner vendor. Your hard work will be worth your time when flexibility and easy scalability propel your business forward.