Nowadays the majority of first-world countries organizations prefer to hire companies from third-world countries in order to carry out different business processes leveraging the competitive cost with a highly qualified workforce. If you are currently exploring alternatives to outsource in order to reduce costs significantly at your company, here’s a quick overview of staff augmentation and why it is considered the best model to outsource software development.
Staff Augmentation and Outsourcing: Are they the same?
Outsourcing consists of hiring a party that does not work by the physical presence of the company to develop activities related to the core business of the organization, which usually are done in-house by the company’s own employees.
On the other hand, Staff Augmentation refers to outsourcing employees in order to add staff to their teams to fill skill gaps and provide support in the organization’s projects. Basically, it is a type of Outsourcing and it’s more focused on supporting current employees in specific projects.
Outsourcing Benefits
- Cost Reduction: Outsourcing will convert fixed costs into variable costs and will deliver capital for investment permitting organizations to avoid huge costs during the beginning phases of their development. Investors see reevaluating decidedly as it permits organizations to place more capital into income delivering exercises.
- Global Talent Acquisition: Outsourcing allows you to widen your pool of candidates since you are not attached to a specific location, it facilitates the access of a variety of qualified professionals.
- Improve Productivity: Outsourcing helps increment efficiency from various perspectives, both directly and indirectly. Basically, it permits workers to focus on what they excel at. These are the assignments that are more significant to them. In the long run, outsourcing additionally helps increment productivity, and frankly work fulfillment for workers.
Outsourcing Cons
- Not Good Encouraging with Current Staff: The existing staff could be resistant to outsourcing since it represents adaptation challenges to the model and at the same time many employees understand outsourcing as a threat of job cuts.
- Decrease of Supervision: The outsourcing model does not assure you to be able to control 100% of the development of tasks or certain projects. For that reason, timelines and outcomes should be meticulously defined during the working process.
- Trustiness Risk: Delivering responsibilities to your outsourcing partner means taking the risks on those specific tasks delegated hoping that he will deliver quality work on time.
Staff Augmentation Benefits
- Staff Monitoring: If your projects demand a high level of control, staff augmentation is the right model for you, since it allows you to have a more in-depth understanding of the process done and how it is being developed.
- Possibility to take advantage of internal and external resources: Outsourcing members can either lean on your internal staff or bring knowledge to reinforce current processes, which adds another level of value to the model.
- Acquiring Skills equals to Cutting Costs: As mentioned above, outsourcing members usually count on knowledge that your current staff might lack. Bringing someone to your organization who actually supports the existing team could save you from training your employees.
Staff Augmentation Cons
- Training Investment: When someone joins your organization, even if it’s locally or outsource, it requires guidance to learn the internal processes, in order to familiarize the new team member with ways of working that are likely to differ from every project.
- Team Supervision: Adding additional staff to your team of course requires time and effort for the current staff, as well as the security measures and access issues your organization has to consider for internal onboarding.
- Internal Issues Reliance: Keep in mind that your current team’s issues might also turn out to struggle for your outsourcing members as well, and as result, a decrease in productivity would be appreciated.
Staff Augmentation or Freelance Consultants?
Hiring a freelance consultant or agency means hiring a professional of your same level that counts with internal employees that at the end of the date would end up assisting your needs. This is more recommended when encouraging new strategies and need someone with specialized skills on higher range duties.
Having that in mind, freelance consultants are not the best alternative when it comes to project-based work. When trying to accelerate projects more efficiently and cutting costs staff augmentation is the solution to all your needs.
How to Choose the Right Model?
- Internal Analysis: Understand your organization’s current needs and resources to determine what are the gaps that need to be fully addressed and how they could be improved.
- Good project Planning: When looking to outsource you should have an understanding of what would be the goals to achieve. A good project definition involves ideas structuring, a description process, and a specialized team to address all needs.
- Analysis of Alternatives: Evaluate every model in order to determine which fits your current situation. Sometimes miss understanding can lead to unsuccessful outcomes, always remember that investing the time in the right decision will pay off.
Finding the right partner when looking to expand your operations overseas might be challenging considering all barriers and process evaluation required to obtain successful outcomes. To have a better in-depth understanding of the process when outsourcing software development we encourage you to read our Nearshore Services Playbook.
During this 15 minute reading you’ll be able to understand:
- The difference between all outsourcing models that vary from location
- Price comparison between models
- Technical process description
- Guidance to find the perfect match for your organization according to the models described.
