What do you do when you have a large technology project with requirements beyond your team’s capabilities? Or if you don’t have the capacity to manage ongoing processes like software support? Or you need to temporarily fill a skills gap on your team?
When you want to enhance your organization’s technological abilities without hiring more full-time employees, you have two main options. You can outsource the work to an IT outsourcing company or you can find a partner that offers staff augmentation.
This article looks at the pros and cons of each.
What is IT outsourcing?
IT outsourcing is the use of an external provider to deliver technology services. In other words, you contract with an IT outsourcing firm to help you with your technology needs. For example, you could outsource your migration to the cloud or the development of custom software for your business.
There are a few different ways that technology outsourcing can work. Some of the more common models are:
- Project-based — you contract with an IT outsourcing partner to provide a specific outcome or set of deliverables
- Dedicated team — you have a dedicated agile team of professionals assigned to work on your projects, usually for a set number of person-hours per month
- Managed services — you outsource particular ongoing processes, such as database management or custom software support, to your technology partner
You can read more about each of those options (as well as staff augmentation) in this article.
What is staff augmentation?
Staff augmentation can be considered a type of outsourcing as well. However, in this model, instead of outsourcing the work, you’re outsourcing the process of hiring temporary team members.
Your staffing partner recruits and hires people to join your company for a fixed period. The new hires are on the payroll of the staffing agency, but they function as full members of your team for the duration of their contract. A good staffing agency will learn about your requirements and ensure that your new team members fit your specific needs.
So what’s better, bringing new team members into your company or outsourcing your project to a third party? Let’s take a look at the pros and cons.
Pros of IT outsourcing
Skip the hiring process
Unlike staff augmentation, which requires you to wait for candidates to be found and vetted, an IT outsourcing team is ready to jump right into working on your project.
No management burden
Your IT outsourcing team has its own project manager for your project. When you contract with a good technology partner, you’ll always have opportunities for input and regular communication with the team, but the burden of overseeing every step of the project is transferred to your partner. That frees you up to work on other things.
Because you don’t need management resources and you don’t have onboarding and training costs, overhead for IT outsourcing is low.
Access to a variety of skillsets
When you work with a technology partner, you gain access to the combined expertise of the whole outsourcing firm. If the requirements of your project change, the team working on it can change composition or scale up or down.
Cons of IT outsourcing
Lack of direct control
The flipside of “no management burden” is that you don’t have direct control over the people working on your project. You have to trust that your IT outsourcing partner is managing their team effectively and delivering the results you expect. While regular communication helps bridge this gap, some businesses may find it challenging not to have immediate oversight of every aspect of the project.
The challenge of finding a good partner
There’s no shortage of technology outsourcing firms to choose from, but some are better than others. If you’re going to trust this company with important projects or processes, you have to make sure you’ve selected the right partner.
A few things to look for are:
- Expertise and experience with projects like yours
- Relevant certifications
- Case studies and testimonials from clients
- Regular communication opportunities
- A focus on delivering business value
If you’re looking to outsource custom software development, we’ve got a list of factors that make a good partner.
Pros of staff augmentation
You're in charge
Your new team members may be on the payroll of your staffing agency, but they function as full members of your team. That means you get to decide exactly what they work on, just like you would for any other employee.
Build a dream team
When you work with the right staff augmentation partner, the contractors you work with can be perfectly matched to your team. They’ll not only have the skills you require, but will fit your company culture as well.
The possibility of contract-to-hire
Sometimes, when a temporary contractor turns out to be a great fit for your company, you can bring them on board full time. This isn’t always possible, but when it is, it can be a major bonus of staff augmentation.
Cons of staff augmentation
You're in charge
Yes, this is both a pro and a con. Staff augmentation means that you’re increasing the size of your own staff. That means you’re responsible for managing your new team members. For a busy business without a lot of extra time and resources, this can be more trouble than it’s worth.
Managing your new contractor or team of contractors creates overhead, including the costs of onboarding, training, and ongoing supervision of your contractors. Businesses need to weigh the benefits of control against the associated management costs.
Which is better: working with a staffing partner or outsourcing to a consultant?
Both outsourcing and staff augmentation can be effective ways to tackle projects and enhance your capabilities — it just depends on what works best for your company. If you want to put your entire project in the hands of an experienced team of experts, choose IT outsourcing. If you want to enhance the abilities of your own team to help you tackle any project you desire, choose staff augmentation.
At Emergent Software, we offer IT outsourcing for custom software, cloud transformation, and data engineering projects. You can work with us using the project-based, dedicated team, or managed services model. If you choose staff augmentation, you can work with our sister company, Emergent Staffing.
To enable comments sign up for a Disqus account and enter your Disqus shortname in the Articulate node settings.