Since the advent of intense globalization, outsourcing offshore or nearshore talent has
become a feasible solution for businesses. From assisting in streamlining their
operational workflow to gaining a competitive advantage, the business strategy is
emerging as a discrete service for worldwide businesses.
The combined impact of team augmentation on saving costs, such as training costs
compensation costs, operational costs, marketing and advertising costs, and overhead
costs further reduce the project and resource budget for a business.
However, businesses often lack expert guidance on what outsourcing model to opt for
and when. In this article, we will discuss the two most popular IT staff augmentation
services and models commonly preferred by global businesses contemporarily— staff
augmentation and project-based consulting.
What Is the Difference Between Project and Staff Augmentation?
Albeit, both are models of outsourcing talent outside the in-house team, several nuances
differ them discretely. Additionally, factors like the organization's size, core competencies,
project timeline, infrastructure costs, long-term strategic goals, data security, legal
frameworks, Service Level Agreements (SLAs), international expansion, and scalability
collectively impact the requirements to selectively choose the right outsourcing model.
In case, you want to know what differentiates these models, this insightful article will help
businesses evaluate on essential differences, terms, and benefits of the two most commonly
interchanged terms, staff augmentation, and project-based outsourcing.
Here we go!
What Is Staff Augmentation?
Staff augmentation is a business strategy that helps businesses gain specialized expertise
from different geographical locations. The process simplifies talent acquisition by
introducing third vendor expertise. Third-side vendors, in this case, staff augmentation
companies with qualified and expert software developers lend outsourcing services to global
companies easing the hiring process.
Staff augmentation services for IT projects bring two benefits. First, global enterprises do not
have any long-term commitments. Secondly, the short-term skill enhancement is rapidly met.
Now, what is an example of staff augmentation?
A classic example of resource staff augmentation is outsourcing software development
services. Businesses with no or insufficient in-house software engineers may prefer
nearshore, offshore, or onshore outsourcing services to fill technical gaps and gain access
to the emerging digital realm.
Also, staff augmentation can opt for non-urgent business priorities. For example, simple
software IT and support, a non-core software need must be addressed to ensure and maintain
maximum downtime. But it is not urgent. Thus, a company can seek staff augmentation
services to build a robust and consistent presence amongst users.
What Is Project-Based Consulting?
Project-based consulting, conversely, is comparatively expensive and includes more long-
term project based commitments. Where staff augmentation ensures short-term development
and IT needs, project consulting helps businesses tap into highly specialized experts who have
defined skill sets to complete projects with desired outcomes within timelines.
Additionally, with project-based consulting, minimal or less training is required.
Technology staff augmentation on a project basis can be high on expertise in operating the
latest tech stack and surfacing technologies for instance artificial intelligence and edge
computing.
That’s why large-scale enterprises employ project-based expertise to gain strategic guidance
in a field where companies have minimal knowledge. For instance, blockchain is an
emerging field that allows companies to secure their transactions and transform their
network into a decentralized ecosystem. Hundreds of companies are still losing lucrative
opportunities to create a robust and secure framework for their business because they lack
industry compliance and inadequate resource allocation for the blockchain.
After frisking quickly on the benefits of both styles of outsourcing, here’s the time to
understand their benefits one-on-one. Also, let’s understand what are the terms that
require a specific solution.
When to Employ Software Staff Augmentation?
Let’s find out what are situations where staff augmentation is usually preferred.
Specialized Skills
Whenever a business needs specialized skills, not necessarily on the latest tech trend. For
instance, a software engineer with JavaScript proficiency.
Temporary Workload
When workload is high and effective resources are not available. For instance, during the
recent COVID-19 pandemic, health insurance industries were severely flocked with hundreds
of registrations and applications.
Seasonal Hike
When businesses have seasonal demands going on and market needs rise. For instance, due to a rising trend for online businesses, software, and application
development, companies need a high number of developers.
Interim Management Needs
Due to internal turbulence like insufficient coordination or the lack of management
executives, a company may need to hire an expert to manage and coordinate.
Flexibility
To adjust the workforce’s size and effectively allocate resources.
Cost Management
When businesses wish to hire but want to save on operational and overhead costs.
When to Employ Project-Based Consulting?
Here are some exemplary benefits of project-based consulting.
Compliance and Regulatory Challenges
When businesses might not want to take risks due to a lack of industrial compliance and
standards.
Digital Transformative Initiatives
When transformative technology, such as AI, ML, and IoT is highly needed by a business,
the situation straightforwardly demands project-based experts.
Specialized Expertise
When businesses want to mitigate risks while making significant business decisions.
Time-bound Projects
Time-bound projects need high precision and skilled accuracy to finish them on due
timelines.
Strategic Planning and Advises
When highly qualified vision and guidance are needed, project-based consulting is the
way-to-go option for businesses.
Conclusion
In the fast-growing world equipped with the latest technologies, businesses have no option
but to outsource software services to immediately tap into the diverse talent pool. In
summary, the final goal of outsourcing is to provide immediate talent and skills to
accomplish the project, be it temporary staff augmentation or project-based outsourcing.
However, understanding the minuscule differences is imperative to determine which model
will be effective for a specific business case.
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