Staff Augmentation and Its Meaning: A Comprehensive Guide
Currently valued at $761.6 billion, the global staffing market is forecast to grow further by 1.4% within 2023. Staff augmentation benefits immensely from this development as an industry largely dependent on global professionals.
Staff augmentation became popular during the first COVID-19 outbreak when companies struggled to maintain some level of normalcy in their operations. Unbeknownst to many, global research giant Gartner Inc. has practiced the approach for decades. It was 1988 when the firm first coined and used the term for various forms of organizational change.
Many companies continue to rely on staff augmentation after realizing its benefits. What they adopted as a temporary solution has even evolved into a matter of policy for many organizations worldwide. Everybody understands that physical limitations do not hinder growth, and staff augmentation helps them topple barriers.
- While developed in the 1980s as a working model, staff augmentation only became popular beginning in 2020 at the start of the pandemic.
- The strategy benefits employers looking for cost-effective ways of filling various roles and employees who appreciate the flexibility of on-demand work.
- Companies can rely on staff augmentation services to make the process more effective and efficient.
Defining Staff Augmentation
Staff augmentation is a working model that enables employers to hire staff without the usual time and overhead costs of permanent, full-time employment. Companies can have varied reasons for taking this route. Some may do it to fill random temporary positions, while others may hire entire dedicated teams through staffing agencies.
Types of staff augmentation according to timeline
As mentioned, companies can consider staff augmentation services for different reasons, usually tied to a time element. Hence, this working model can work short-term or long-term.
- Short-term. Various scenarios can create a need for short-term staff augmentation. For example, a company may bring in additional people for temporary roles beyond the expertise of its in-house team. While recruiting permanent employees, they may bridge a labour or skill gap by hiring people for a limited time. If project management requirements include expediting the completion of tasks, the company may employ extra hands or minds.
- Long-term. While companies usually engage in short-term staff augmentation, certain situations may require them to do it long-term. For example, they may consider staff augmentation instead of hiring full-time employees to cut operational costs. When unsuccessful in filling a crucial role in-house, they may also look outside and consider staff augmentation.
Types of staff augmentation according to purpose
Staff augmentation can work in various ways, depending on the problems it can solve. Companies may use the following types of models according to their purpose.
Commodity staff augmentation. Companies use this model, also called project outsourcing, when filling roles temporarily for a particular task or project. Commodity staff augmentation is suitable for filling positions that require no specialized skills, such as data encoders, clerks, etc.
However, companies must still ensure that candidates meet at least the minimum qualifications for the job. They must also create a plan to ensure the hassle-free integration of the new augmented team into the existing workforce. Additionally, the program must specify methods for managing the new employees, including monitoring their performance.
Skill-based staff augmentation. In skill-based staff augmentation, companies determine the skills they need and find suitable candidates to fill short-term or long-term positions. This practice works perfectly for those who don't want to invest in or have no budget for staff training.
Unlike the commodity model, skill-based staff augmentation requires specific but not necessarily top-tier skills. The company gets the level of proficiency it wants from new hires without investing in building it themselves.
Highly-skilled staff augmentation. This model involves hiring talent for positions that call for critical, hard-to-find skills. Candidates must have focused expertise in specific knowledge areas, allowing in-house employees to concentrate on tasks for which they are more suited.
The most important thing about highly skilled staff augmentation is hiring people who can deliver beyond expectations. Hiring someone only marginally better than an existing staff member is pointless.
Benefits of Staff Augmentation
Cost-effectiveness is the most common advantage of staff augmentation, but it can help companies in many other ways. People also usually associate it with tech talent, software development, or IT staff augmentation. However, the practice also helps many others industries. Below are the most prominent benefits of staff augmentation to companies worldwide.
Mutual flexibility and cost-effectiveness
Among the most valuable advantages of an augmented staff is flexibility. The approach enables companies to bring in talent to serve their short-term needs and requirements. They can replace permanent workers with skilled professionals to perform specific tasks that may be critical at a particular time.
With this setup, firms can avoid the usually high costs of permanent hiring, such as health benefits and disability coverage. On the other hand, it also offers professionals the freedom to work only on a project basis, making it a win-win scenario for the two sides.
At the same time, staff augmentation helps balance professional skill demand and supply without costing companies too much time and money. It means meeting the needs of both employers and employees through this staffing strategy is a creative process in itself.
Staff augmentation is a short-term hiring method that connects firms to a practically unlimited pool of talented and skilled professionals. Due to their apparent restrictions, such as time zone and physical office space issues, permanent hiring practices cannot offer this advantage.
Moreover, staff augmentation gives companies more opportunities to hire millennials, who are known for their laser-focused knowledge and skills. Professionals hired through staff augmentation generally possess unique, domain-centric abilities, making them precious additions to any team.
Companies, especially startups, can access highly experienced professionals for a quick project instead of permanently hiring them. The talent pool for these firms automatically expands as staff augmentation allows them to hire professionals with diverse skill sets.
Small businesses usually spend so much to sustain their operations, especially during lean months, and often without enough returns. Through IT staff augmentation services, they can increase operational efficiency by using flexible working platforms.
When these businesses work with staff augmentation companies, they won't have to worry about the cost of the necessary infrastructure. The new hires can work as a remote team or on the premises owned by the staffing organization. Of course, these professionals will be accountable to the firms that hired them.
Aside from not having to pay for infrastructure, companies that use staff augmentation services also reduce their offshore operational costs. Hence, these firms can increase their profit margins because of their lower hiring expenses.
Another advantage of staff augmentation flexibility is the freedom to operate as an interim business without relying on a conventional workforce. Many companies are afraid to scale up even if market conditions seem favourable.
Staff augmentation can come to the rescue when these companies are worried about the hazards of failing as an obstacle to scalability. The staffing model allows them to hire people as they explore the possibility of expansion without committing to it.
Aside from expansion, staff augmentation helps companies adjust to evolving market conditions. Indeed, with millennials gaining new skills every day, market demand has never been more volatile than ever.
Companies will likely fail when they don’t rise to the challenge of this changing labour landscape. It also means staff augmentation improves a firm's responsiveness. The practice allows a company to adapt to shifting circumstances by meeting new demands for which a skill-specific workforce is more than ready.
Diversity of ideas
Although experience can only be built through age, millennials have much to offer with their bold worldviews. Besides, the team members' creativity can suffer with the same employees working for a company. This fact becomes even more important to consider as project managers look for fresh, innovative solutions.
Companies can engage with an interesting mix of professionals offering new, exciting ideas through staff augmentation. With the freedom to hire by project through staff augmentation, companies can exploit these ideas to boost their operations.
Although companies can use staff augmentation services, they will remain in control over their projects and new hires. This feature contrasts with managed services or outsourcing models, which assign responsibility to the outsourcing company. A company can exercise full control over the new staff members with staff augmentation.
How To Select a Suitable Staff Augmentation Provider
Picking the right staff augmentation service provider may be the most crucial step in any staff augmentation model. This vendor can either improve the client's existing process or worsen it.
First off, the augmentation vendor must be a good fit for the company's culture. A team used to a casual, modern setup may not be compatible with an agency that is too formal or corporate in approach. While they may get along initially, the mismatch can eventually build pressure that could lead to poor outcomes.
Another essential factor to consider is the vendor's specialty. Although staff augmentation agencies can work with different clients, businesses are usually better off with partners having significant experience in their own industries. A vendor mainly working with healthcare clients may not be the best for an IT company.
Finally, reading reviews about augmentation vendors before committing to one is always a good idea. Reviews offer a realistic view of what a company might expect from the vendor. However, not all reviews are trustworthy. Sticking to reputable consumer websites is vital to ensure objectivity, balance, and overall credibility.
Did you know?
In 2022, businesses paid over $700 billion on outsourcing, with IT outsourcing alone expected to reach $519 billion in 2023.
Work With an Experienced Staff Augmentation Company
Staff augmentation has come a long way, becoming widely accepted as an alternative staffing model today. There is no question that companies worldwide have been reaping benefits from its flexibility, flexibility, cost-effectiveness, and operational efficiency.
However, staff augmentation can be complicated to implement, so most companies consider hiring experts to help them. Since the strategy requires in-depth knowledge and experience, not just any company will do. Everything boils down to track record, especially in handling the cons of staff augmentation. This is one of the many strengths of Brain Box Labs.
Staff augmentation can be a simple task for your company. We can help you begin and sustain the strategy and maximize your gains. Contact Brain Box Labs today.