Staff Augmentation – An Effective Alternative to Nearshoring

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Hiring external workers and employees is a common practice among companies. It assists them in their development and provides extra technical experts that can work efficiently to complete their tasks. There are various hire-contractors-on-demand services available where you can either choose to award your whole project or a part of it to an external agency or freelancer. For example, you can adopt nearshoring or offshore outsourcing. You may bring in an extra helping hand to work alongside with your team through staff augmentation.

In this post, you will learn the concept of staff augmentation, how it benefits your business and what makes it an effective alternative to nearshoring.

What is Staff Augmentation?

Staff Augmentation is the business practice of hiring experts and professional workers temporarily to accomplish specific tasks and objectives. It is usually for a limited time period in order to increase the company’s workforce and divide the workload. These contractors are usually provided workspace on-site, alongside other company members.

Why you should Implement Staff Augmentation:

The Staff Augmentation model has proven to be successful time and time again. For example, the king of search engines, Google, hired ‘Kaggle’, a group of freelance data scientists as part of their staff augmentation strategy in 2017[1]. Every year, the global staffing industry generates a revenue of around $490 billion. At the same, companies are hiring time millions of freelance workers, who are another source of staff augmentation, each year.

If the whole world is indulging in the staff augmentation model, there must be something special about it, right?

According to a report [2], a full-time employee costs a company 25% more than the employee’s salary. Hiring a full-time employee is both costly and risky. Although you pay your employee only $40,000, it may be costing your company $60,000-$70,000 adding employee benefits, bonuses and other packages. Additionally, there’s a chance you might end up selecting the wrong candidate and the re-recruiting process may take a while. This will further add delays on your projects and deadlines. 

Staff Augmentation
In the right circumstances Staff Augmentation has huge benefits

Staff Augmentation: Individual Recruitments vs Staffing Agencies

There are several decisions you need to make before hiring someone as an external part of your workforce. You don’t merely indulge in Staff Augmentation immediately to save extra costs and time. The first thing to consider is the place you want to hire a temporary technical expert from.

There are two fundamental choices in this regard:

  • Individual Recruitments:

It might take a long time to find an individual worker who is skilled enough to develop and work alongside your team. However, it’s worth it in the respect that freelance workers or individually chosen temporary staff members mostly agree on fewer costs. They are much more flexible, and you can make them work on your terms. On top of that, you get their diverse experience of various different projects as an extra bonus.

  • Staffing Agencies:

Hiring staffing agency workers means you are getting individuals ready to work in a professional environment, and with a large workforce. Although a little costly, these workers are more likely to respect the secrecy of your projects. They will also provide innovative solutions for your problems and blend in with the rest of your staff.

However, you need to consider training time, sensitivity and the length of your project before inviting anyone over; freelance or staffing agency. Companies should only select Staff Augmentation where the project is short-term, and the maximum work required is for a few months to a year. Running contracts for years with employees who are not yours can cause several difficulties along the way.

How is Staff Augmentation an Effective Alternative to Nearshoring?

Both nearshoring and staff augmentation involve the hiring of contractors to work on your solutions. However, there are several reasons why staff augmentation can prove to be a much better option for you.

1.    Administer and Supervise your Employees Directly

With staff augmentation, the hired employees are working on-campus under your watchful gaze. While nearshoring may cause workers to slack off, staff augmentation allows you to monitor the performance of your temporary staff in real-time. Any changes or updates made to the project can be notified immediately to the workers. Problems arising due to lack of supervision and a barrier in communication are nullified.

2.    Quality Control

With nearshoring, the employees are usually highly qualified and skilled in their fields, giving satisfying results. However, the lack of direct control over the workers can also cause discrepancies in the required outcomes.

Development projects are sometimes difficult to communicate and explain to people working many miles away from you. But with temporary in-house workers, the chances of miscommunication become almost zero.

You directly control the quality and results of the tasks done by the external workers. It is easy to maintain the productivity and standards of your company. Additionally, you achieve your desired results, culminating in an improved market reputation of your company.

3.    Better Business Understanding

Employees hired through nearshore outsourcing have little information about the company’s system, vision, mission and processes, which often results in delivered projects that the in-house workers need to tweak according to their needs.

 With staff augmentation, the external workers work alongside the company’s in-house teams. It grants them a better understanding of the company’s approach to different things, and they have an improved overview of the project to be done.

4.    Grow with the Experts

Both staff augmentation and nearshore outsourcing provide you with the opportunity to hire the required qualified and experienced workers from a pool of experts. They allow you to enjoy their expertise and innovative approach to different tasks. However, by augmenting your staff, you allow your in-house workers to learn from the temporary employees. Thus, not only do you complete your project in record time, but your full-time developers also get guidance and learning.

Choosing the right model: Nearshoring or Staff Augmentation

You need to take several factors into account before choosing a model for your technical projects. These include the skill-set of your in-house employees, the required skill set for the contractors, total budget, secrecy and sensitivity of your project. Also, consider the overall ease with which you want your project done.

However, if you don’t mind remotely stationed employees and workers, nearshoring might prove to be beneficial for you since you can get the work done at lower costs. But if you want people working directly with you or if you want your next new launch to remain undercover, inviting people over on the premises through staff augmentation might be your only option.

To learn more about Nearshore Outsourcing, read our blog on Nearshore Software Development Outsourcing for Established Companies . If you need more information about developing an MVP using Nearshore Outsourcing then click here.

We at Digitsory can help you to find the best contractors for the implementation of your staff augmentation strategy. See our case study video Contact us here to get a quote, and for any other details.

  1. https://www.toptal.com/insights/future-of-work/what-is-staff-augmentation
  2. http://www.uhy.com/employers-now-pay-average-employment-costs-worth-nearly-25-of-employees-salaries/

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