Outsourcing

Staff Augmentation Meaning: Why It is More Efficient than In-house Team

9 min read

The journey from an idea to a fully functional software product is no small feat. Common challenges include limited time, budget constraints, and potential skill gaps. The struggle to match with skilled developers and dealing with in-house administratives can add to the stress. 

How to hire a development team quickly, and within your budget?

Staff augmentation is a game-changer. Clutch reports show that one-third of small businesses (37%) outsource at least one business process to reduce costs and enhance skill sets. On top of filling the technical expertise, the team extension helps to expedite project delivery.

In a study by MarketsandMarkets, the IT staff augmentation services market is expected to grow from USD 132.9 billion in 2020 to USD 193.9 billion by 2025. That's a significant leap that evidently signals a shift in how businesses are assembling their tech teams.

In this blog post, we aim to unravel the staff augmentation meaning and shine a light on its advantages over traditional in-house team setups, and find out why this model could be the key to more efficient project delivery.

In-house vs. Staff Augmentation: Pros & Cons

When you have an in-house development team, you're creating and maintaining applications within your company's infrastructure. This model promises hands-on control, seamless access to company resources, and direct communication and collaboration with other departments. 

Yet, there's another side to in-house team management. On average, it tends to be costlier, requiring investments in personnel, equipment, and infrastructure. The process of building an effective team and fostering a cohesive work atmosphere can also be time-consuming.

Now, let's explore the outsourcing model within IT staff augmentation – a popular choice for businesses seeking domain expertise, flexibility, and efficiency. 

So, what is staff augmentation definition? In outsourcing, staff augmentation means the team becomes part of your existing in-house team. They dive into your workflow and enhance your current capabilities with their expertise and skills. This model provides access to a wide pool of specialists who can swiftly address expertise gaps and speed up custom product development. Here's why a staff augmentation is a game-changer:

  • Expertise tailored to your needs. Currently, 75% of employers struggle to find talent with the skills they need. Team extension expands your pool of specialists with domain-specific expertise, making it easier to find the skills you really need. Clients have the flexibility to choose the outsourced specialists they require for their product or an MVP development team. It could be a single dedicated member filling a specific expertise gap in your internal team or an outsourced team of specialists.
  • Streamlined recruitment. Clients are free to scale their teams up or down based on their on-demand project needs. It means they can request an IT vendor for more specialists and engage them in a work process with minimal time. This flexibility ensures an agile response to evolving project requirements.
  • Cost reduction: With outsourcing, you avoid the expenses tied to maintaining an in-house team, such as office space, equipment, and infrastructure. Additionally, you can optimize labor costs by engaging specialists as needed, without long-term financial commitments of full-time employees.
  • Faster project delivery. Unlike other engagement models, staff augmentation commits exclusively to one project. This eliminates delays related to multitasking and promotes a deeper understanding of your project. This dedicated focus leads to efficient problem-solving and quicker decision-making, ultimately accelerating the overall project delivery timeline.
  • Flexibility at its core: A team extension integrates into your existing workflow, adapting to your rhythm and working under your supervision. This flexibility ensures they don't disrupt your established workflow but enhance it to boost project performance.
In-house vs. Staff Augmentation

Despite the bulky list of advantages, staff augmentation outsourcing faces a key challenge: communication. Issues in communication may cause bottlenecks in the workflow. To avoid them, both IT vendors and clients need to establish clear communication protocols, engage in regular updates, and foster an open dialogue.

Read more: How to Improve Development Workflow with Remote Dedicated Teams?

Why Staff Augmentation Is Better than In-house

It’s hard to imagine the success of software or custom web development without an expert team. Businesses and startups recognize this fact and find outsourced dedicated teams the best solution of all.

Yet, tech expertise is not the only significant factor to favor a team extension. Let’s see what reasons make them outshine in-house development.

You save time on recruitment and onboarding.

Bringing together an in-house team is a time-consuming process. On average, hiring an in-house developer takes up to 40 days, not to say, that you’ll need more time to onboard and delve candidates into the project. 

In contrast, staff augmentation model allows for a quick start of work. IT vendors have a diverse pool of specialists with relevant experience knowing step-by-step how to organize work within an existing team. An outsourced team can start working immediately after the contract is signed. This efficiency in recruitment and onboarding saves valuable time that can be used strategically.

You save costs on hiring and maintenance.

For many companies, budget constraints are the most critical factor when choosing between outsourcing and in-house product engineering. 70% of companies find outsourcing to be cost-effective, reducing the expenses associated with hiring in-house staff. So if you’re planning to reduce development costs in 2024, global IT outsourcing will be your best solution. 

Outsourcing, in general, proves to be more cost-effective, with hourly rates of developers from regions like Eastern Europe ($35-50) significantly lower than those in the US ($70+)f. This approach allows for budget flexibility, ensuring optimal resource allocation without the initial high costs linked to in-house development.

One more significant advantage of outsourcing is avoiding resource "drawdowns". Scale the team up or down based on the project phase instead of assigning “extra tasks” for in-house developers during periods of reduced workload. On top of that, you’ll save on in-house costs related to salaries, benefits, and infrastructure expenses.

You have easy access to diverse expertise.

The complexity of your project plays a pivotal role in determining the most suitable development approach. Outsourcing shines when your project demands diverse skill sets or niche expertise, offering access to a global talent pool. It’s a flexible way to reach out to specialists in different niches and g in one place. attention it requires. 

In-house development, however, is more suitable for straightforward projects with immediate control and oversight where having a specialized skill set isn't a critical requirement. Evaluating the intricacies of your project's complexity guides you toward the development strategy that best meets its unique demands.

You speed up your project turnaround.

Outsourcing accelerates project timelines through the efficiency of teams and streamlined processes, particularly advantageous in the fast-paced world of MVP development. Faster time-to-market ensures your product swiftly reaches the market. 

Meanwhile, in-house development may involve longer timeframes due to the necessary processes of recruiting, training, and integrating new team members. Balancing the urgency of your time-to-market needs with development timelines guides you toward the most appropriate strategy for your project.

You can adjust a team easily to your changing needs.

Outsourcing with team extension allows you to adjust team size based on project demands and ensure maximized flexibility. This adaptability is particularly advantageous for projects with fluctuating workloads. In contrast, in-house development may face challenges in scaling rapidly due to the time required for recruitment, training, and integration.

Staff Augmentation Benefits

Is It Hard to Manage IT Staff Augmentation Teams? 5 Challenges and Their Solutions

We will always stand by the benefits of staff augmentation; however, it's not all sunshine and rainbows. Some tricky bits make companies and startups think twice. 

What makes outsourced teams hard to manage? Here are five common challenges and their practical solutions. Let’s see how we can turn challenges into wins.

Finding motivated, skilled team members.

Challenge: The remote nature of outsourcing can sometimes obscure the passion and expertise crucial for collaborative success. The absence of face-to-face interactions might make it challenging to gauge team members' motivation and skill levels accurately.

Solution: It’s vital to assemble high-performing teams based on mutual interest in the project. At ElifTech, we take our selection process seriously going beyond pure technical competence. We check if our potential candidates for the project are eager to solve the client’s challenges and if they are easy to collaborate with. Regular virtual engagements and team-building activities may also foster motivation within in-house and dedicated teams.

Managing costs with undefined project scopes.

Challenge: Unclear scopes and undefined project needs cause budget overruns. It leads to the challenge when it’s difficult for them to align services with a feasible budget, fearing the potential for unexpected costs and scope creep.

Solution: Defined project requirements to make everything clarified and transparent. They help you keep your project on course, delivering the expected outcomes within the defined financial parameters. The first thing ElifTech does when taking on a client project is define project scopes. Our commitment to cost-effectiveness is rooted in strategic planning to help you minimize unexpected expenses. Payments are set in advance and are based on the services you use. Such a system helps you tackle expenses smartly and without compromising your budget. 

Overcoming time zone differences.

Challenge: Cross-location communication can be a stumbling block, leading to misunderstandings and hampering project progress. Navigating different time zones and ensuring effective communication across geographically dispersed teams pose considerable challenges.

Solution: An c vendor must establish guidelines for flexible scheduling and utilize tools to optimize workflow across time zones. Regular meetings at mutually convenient times can add up to more effective cross-location collaboration. By fostering a communicative environment, ElifTech mitigates the challenges associated with remote collaboration, allowing your team to work harmoniously regardless of geographical distances.

Coordinating tasks and responsibilities.

Challenge: Remote development teams may have a poor system of coordinating tasks and responsibilities, which always affects project timelines. Companies often fear that the reason for a disjointed workflow is the lack of physical proximity.

Solution: Well-established software providers have a robust set of project management tools to streamline task coordination. At ElifTech, we always double-check if we’re on the same page with our clients when it comes to expectations and project goals. We also have a structured framework for task coordination among team members to ensure everyone knows their areas of responsibility and follows the same agenda.

Monitoring performance and progress remotely.

Challenge: Remote monitoring can raise concerns about its productivity and quality. Companies often worry about maintaining visibility into the work processes and outputs of remote teams, fearing a compromise in performance and the overall quality of deliverables.

Solution: At ElifTech, we embrace technology to monitor remote performance. The project management tools (e.g. Jira) we use provide real-time insights into progress. Regular performance reviews and clear expectations sets the uncompromised quality during the entire cycle of the development process.

Final Say 

So now when you've already got a hint on staff augmentation meaning, what would you choose: a resource-heavy process of in-house enrollment or a flexible team ready to work immediately?

In conclusion, the wheels of the tech industry are turning ever more swiftly and the need for flexibility, cost-effectiveness, and swift scalability has made staff augmentation an increasingly appealing choice compared to traditional in-house recruitment. Given its impressive benefits—ranging from access to specialized skills, and economic efficiency due to paying solely for required skill sets, to greater project management control—it's clear that IT staff augmentation allows businesses to remain both nimble and competitive in a rapidly changing tech landscape.

So, as you consider your next big tech project, it might be worth giving staff augmentation a serious thought. In a marketplace where getting the right talent on board could be the difference between staying ahead of the curve or lagging behind, this efficient, modern approach to building your dream team can potentially swing the pendulum in your favor.

Remember, succeeding in the business world is not just about working hard; it's about working smart. And sometimes, working smart means augmenting your staff to match the needs of your business landscape. Given the data, research, and real-world examples, it seems there's no better time than the present to explore the potential of IT staff augmentation.

Whether you choose to build your team from scratch or extend your in-house capabilities, ElifTech empowers you to focus on what matters — bringing your idea to life. Let us know if you need to discuss your goals and pain points in a free consultation.

FAQ

What is the difference between in-house and outsourcing?

When you build in-house, you handle everything internally—hiring, training, costs. Outsourcing taps into external experts, cutting expenses and speeding up project timelines. It's all about finding the right fit for your unique needs.

Which is better: staff augmentation or in-house?

Depends on the company's specific needs. Outsourcing offers benefits like specialized skills and cost reduction but carries risks. In-house provides more control but demands significant resource investment. The optimal approach depends on unique circumstances and goals.

What are the disadvantages of a dedicated team?

Dedicated teams bring tons of benefits, but remote work can throw communication challenges your way. Clear communication and regular updates are crucial to keep things flowing smoothly.

What are the biggest challenges for a remote team?

Challenges for remote teams include navigating unclear project scopes, dealing with time zones, task coordination, and remote performance monitoring. To address these issues, make sure everyone shares the same project requirements, maintains robust coordination, and has a well-established system of cross-location communication.

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