STAFF AUGMENTATION VS PROJECT OUTSOURCING

Due to the recent circumstances, we have seen strong momentum towards digitization and remote working. As a matter of fact, most companies are looking for possible ways to cut their costs and yet maintain the quality of their software solutions. While many creative ways have been developed over the years, only a few of them have been successfully adopted. Staff Augmentation and Project Outsourcing are one of those practices that have been endorsed worldwide. These conventions help the companies save costs and also the flexibility to their business model. Rather than hiring a full-time employee at the onset of every project, these alternative methods enable you to hire tech support globally on a project basis or for a particular time. 

Although loosely based around the same outsourcing model, both staff augmentation and project outsourcing have different work ethos. 

Staff Augmentation

• Staff augmentation can be defined as a flexible software development outsourcing technique with a personal touch. In this model, the hirer is the in-charge of the augmented team and manages them directly. You can hand-pick the talent that fits in the project requirement and budget, extending and reducing the team as per the workload.   
• An efficient software development outsourcing company can help in hiring skilled and certified professionals, both short term and long term basis; cutting the costs and liabilities that come with making full-time hires. These professionals might be local or remote, but they are committed to a single project at a time under the supervision of the hirer. 

Some key points that must be noted about staff augmentation are: 

• It does not require any specific infrastructural investments.
• Rules out additional costs of in-house workforce.
• Helps in reducing time spent on recruitment tremendously.
• The remote nature of this practice keeps it unbound from geographical limitations. 

We have collected some common scenarios where staff augmentation can help in easing the workload and maintaining the efficiency of the team:

• While working on a project, there occur many instances when the local staff is occupied working on the product but you also need an additional team of programmers to develop another part of the product. It can be very difficult to find this supplementary team within such short notice and recruiting local talent does not come without risking the product quality and deadline. Fighting through the high demand in the market and competitive pricing is not a viable option. 
• Finding a specific and rare set of qualifications in the local market can be a tough job, especially while working under a deadline. In such situations, extending your search to remote locations through staff augmentation can help in hiring a stack of professionals tailored to your needs.
• While project outsourcing is also an option of remote project development, this cooperative pact is not always compatible due to several reasons.

First, you cannot connect to the hired team directly on a daily basis and supervise the work.

Second, not being well acquainted with the remote team hampers team integration. It is a vital requirement as it motivates the staff and ensures synchronization in the project to achieve a common goal. 

In a nutshell, the main benefits of staff augmentation can be accumulated under a few pointers:

• Cost Cutting

This is one of the major benefits of switching to this model. The cost structure of staff augmentation is completely transparent. You are not responsible for the additional costs that come with in-house hiring like the expense of office space, work stations, job benefits, etc. You are only liable to pay one fee based on the duration and type of project and the vendor will be responsible to provide everything else. This service-based hiring allows you to dedicate more time and attention to your main business activities. 

• Productive Efficiency

Software development outsourcing via staff augmentation enables a higher productivity level as the hired developers are dedicated completely to a single project. This can be considered better in contrast to the project outsourcing model where the hired team might be managing several projects simultaneously. Working on a single large project rather than several small ones is also beneficial for the developers as the workload is divided evenly and it attracts extra motivation and dedication to a larger vision.

• Secure IP Rights

Right from the beginning, you are the in-charge of all the tasks being carried out, hence, all the IP rights belong to you, securing the authenticity of the project.

• Flexible Work Nature

There are mainly two flexible sides in this working model:

1. By expanding your search location, you get access to global talent with a wider range of qualifications, whether it’s UI/UX Designers or front-end developers to IT professionals who are scrum masters and product owners. 
2. The wide range allows you to look for talent that fits in your budget and specifications. They are also easily replaceable according to your requirements.

• Motivated Staff

As more and more developers join the industry every year, the crowded industry experiences the influence of senior software engineers throughout a project, pushing the younger talent to cooperate with product companies. The staff augmentation allows them to work according to their will and develop new and exciting products, one after another.   

As these pointers sum up the benefits of staff augmentation, some pointers should be looked into to ensure the success of this working model:

• When you outsource IT projects, make sure that your remote developers are provided separate team rooms and all the necessary services by the vendor.
• The software development outsourcing company you choose must be reputed and qualified.
• You, along with the in-house team, must get well acquainted with the remote developers to ensure coordination and efficiency during the project. 

Project Outsourcing

The practice of project outsourcing or software development outsourcing has been prevailing for some time now. As the name suggests, in this model you pay for a predetermined outcome and partner with the outsourcing company in sharing the risk. Essentially, it is similar to the staff augmentation model except for the fact that you do not supervise the hired developers. The development outsourcing company you choose will recruit, train, and manage the staff on your behalf and handle the development of the product from their end. This team will not be involved directly in any of your internal activities and work separately to complete the task you’ve set out for them.  

Some recent studies suggest that in the past few years, there has been a significant increase in the IT budgets allotted for outsourcing (especially amongst North American countries) within both – midsize and large companies. They have become rather familiar with outsourcing onshore, nearshore, and offshore due to the benefits of this model. Even leading tech giants like Google and Microsoft entrust technique and share their victorious feats with software development outsourcing companies.

The Agile methodology and Scrum methodology are particularly popular formats of project outsourcing. The agile method involves close coordination among the development teams to develop the software in small and measurable releases, maintaining a steady cycle with repetitive testing on every level, ensuring the functionality and quality of the product. You get to exercise greater freedom in applying new changes with transparent costing based on the frequency of changes being applied.

Part of the Agile framework, the Scrum methodology is employed when dealing with complex programming. The project is divided into smaller formats and built step-by-step, enabling the team to respond to feedback and changes more efficiently. It also allows the developers to foster creativity, rather than chasing unrealistic deadlines monotonously. The impeccable success rate of scrum makes it the most popular format, being regularly employed by tech giants. 

Some of the benefits that come along when you outsource IT projects are: 

• Cost Reduction

This is one of the major and most obvious benefits of adopting the project outsourcing model. More than half of the companies that practice this technique do it to cut the extra costs and ditch the effort involved in setting up, training, and managing an in-house team for program development. Once signed in contract, the vendor is responsible to carry out all these tasks and provide the desired product well within the deadline.

• Access to Desired Qualifications 

This working model is a true boon when it comes to the hiring aspect. It helps in gaining access to developers with rare and some of the most sought after qualifications in the industry. Many instances occur when the expertise you look for isn’t available in the local market. In such scenarios, project outsourcing acts as a true lifesaver.

• Streamlining Workflow

Project outsourcing helps tremendously in maintaining a smooth workflow. The managers can save up a lot of time and effort from the in-house team by delegating basic programming projects. This allows the management to flexibly focus more on the important issues and concerns within the company. The offloading of tasks also lets the programmers work on the mission-critical projects and assignments that fall under the company’s particular area of expertise.  

In order to ensure complete success with the outsourcing model, a few steps must be taken into consideration:

• The first step is to clarify the requirements beforehand. You need to preplan the amount of work you wish to outsource. This involves answering questions like what kind of tasks need to be outsourced, how much engagement is required, the criticality of the project, and last but not the least, how much budget you can allocate to outsourcing?
• Once these questions are answered, the second step is hiring a suitable software development outsourcing company. The vendor must be chosen carefully with a thorough review of their experience, expertise, working model, quality, security configurations, and ability to stick to deadlines.
• An ideal vendor will also help in providing valuable inputs to the project, to enhance the product quality. Finding a credible vendor can help you develop a mutually successful business relationship in the long run.