Staff Augmentation Vs. Managed Services: Which Way To Go?

More and more companies are continually looking for solutions for their dynamic and ever-evolving challenges. Technology is extremely growing and the need to adapt has never been this urgent.

The Covid-19 pandemic also has not made things easier for businesses: the pandemic disrupted the work environment leaving a majority of businesses understaffed in most departments including the IT department.

With this disruption, companies face a major conundrum on how to recruit and sustain a workforce that will keep the company viable and sustainable.

When it comes to staff outsourcing, two primary outsourcing models are at play. This article discusses staff augmentation vs. managed services and which one best suits you. Keep on reading to find out your best option.

What is Staff Augmentation?

Staff augmentation is an outsourcing method in which you temporarily acquire the services of skilled specialists for a certain period. The outsourced experts work with your in-house team to deliver the project at hand.

Rather than using all your time and energy in hiring permanent employees, this method allows you to hire skilled professionals for a particular task for a defined period.

The main point of staff augmentation is to supplement your in-house team with skills and expertise that might be lacking within the team. The outsourced professionals are readily available and only serve for a specified time.

Pros of Staff Augmentation

Here are some of the benefits of using staff augmentation for your business:

  1. Saves recruitment time

Staff augmentation saves you time. Rather than advertising, recruiting, interviewing and onboarding a staff member, you get to shorten the hiring process by using an established expert who is readily available.  This is particularly important during an urgent task that requires immediate attention.

  1. Reduce costs and increase output

Hiring additional staff permanently adds to your expenses and overhead costs such as extra office space, hardware, software, and many more.

Staff augmentation helps you to acquire the services of professionals without necessarily taking a huge dent in your pockets. You hire professionals on a need basis.

  1. Focused Control

This model allows you to remain in control over the results of the project and every key element of the whole process. You are essentially on top of things. You still are the boss.

You oversee the whole project and only relinquish control over the development and technical processes. This ensures efficiency and lowers the chances of delivering a substandard result.

Drawbacks of staff augmentation

Here are some of the drawbacks of using staff augmentation:

  1. Cost-ineffective in the long runthe cost of prolonged staff augmentation, in the long run, may be higher than permanently employing an employee or a team. Staff augmentation avails you of premium skills and expertise at a premium fee which might not be sustainable for a long period.
  2. Scalingthe size of the team you can attain using staff augmentation is limited. It wouldn’t make any sense to augment over 10 people. You also may not be able to outsource enough talent from a single vendor. This then requires you to source from different vendors causing quality inconsistency. 

When to deploy staff augmentation

Here are the cases in which staff augmentation is appropriate and most effective:

  • When sourcing for specific skillssome challenges and problems require specific skills. Staff augmentation helps you to outsource such skills that are unavailable within your in-house team.
  • To strengthen and supplement your team – some projects require an experienced team. Staff augmentation helps you to strengthen your team and equip them with the necessary expertise and experience to handle such projects.
  • When you are constrained on time Staff augmentation is your outright option when you have an urgent project with a pressing deadline. This process cuts on the recruitment process and time. It provides a quick way to access top talent without having to go through the long recruitment process.

Managed services

This model involves fully outsourcing specific business operations from another provider. This model is normally used for software development and IT operations in which businesses outsource all the technical know-how from a managed services provider.

In this model, you relinquish and transfer control to the outsourced team, therefore, improving operational efficiency. You in turn get to focus on your core business and other non-technical aspects of your business.

Benefits of Managed Services Model

There are many benefits of using this managed services model to grow your business. Here are just a few of them:

  1. Time-saving – This model allows you to access too top talent while cutting on staff recruitment and onboarding time. You work with a whole team of experts without having to undergo the long process of recruiting individual members.
  2. Economic benefit – This model costs less and is economically feasible. You only pay for the service for as long as you need it. Rather than permanently hiring a team, you outsource the functionalities for a given period and on a need basis.
  3. Guaranteed results – Normally, managed services are charged based on the outcome. This, therefore, ensures that the outsourced team delivers according to the scope of the project. The provider works diligently to deliver on their promise to enhance the value of their work.
  4. Access to top talent – this method allows you to access top talent for your project. Managed services firms are bigger than staff augmentation firms and tend to work with the top talent in the industry. You, therefore, get to work with very experienced experts.

Drawbacks of using Managed Services

Managed services are a good model for business growth. However, there are a few drawbacks to this model. Here are some of them:

  1. Outsourcing the wrong processes – Some processes require a high level of passion and can only be effectively accomplished by business owners and stakeholders. Others are proprietary and therefore inappropriate for managed services. This model is unfit for such processes.
  2. Wrong service definition – Some services are overly defined making them illogical and complex. When this happens, service delivery is hindered therefore making the model ineffective.

When is Managed Services Right for You?

Managed services model is very effective and can lead to massive business growth when properly undertaken. This model is fit in the following scenarios:

  • When focused on future growth – Managed services offer you a sure stepping stone to business viability and future growth. Using knowledgeable and experienced teams to grow your business guaranteed your growth in the future.
  • When adopting new technology – Managed services model is appropriate when you are adopting a new technology that you lack internal capabilities to undertake.
  • When you must comply – Some processes require a high level of compliance. Attaining this level of compliance might be a little bit tricky with an in-house team. However, managed services guarantee this compliance as it is in the scope of the project.

Difference between Staff Augmentation and Managed Services

Both models have a massive impact on the growth of your business. However, there is a slight difference in staff augmentation vs. managed services. Being cognizant of the differences will help you decide and adopt the right model for your business.

Staff Augmentation blends the outsourced experts with the in-house team to complete the task. You are essentially in control of the project and can supervise and determine the outcome of the project. This model is also appropriate for a short-term project.

Managed services model on the other hand is suitable for a relatively long period but might be economically unfeasible for a long time.

Managed services model allows you to hand over control of certain business processes to a team of experts with the skills and expertise to deliver the project. The new team of experts handles the project to completion with little supervision.

Staff Augmentation vs. Managed Services Comparison

Deciding which model to adopt can be a little bit tricky for you as a business owner. Here is a table of how staff augmentation vs. managed services models compare to each other;

 Staff AugmentationManaged Services
Best forShort-term needs, and Low-budget projectsOutsourcing entire project over a long period
BillingBilled based on time spent on the projectBilled per project usually on retainer
ProcessesCommitted to giving an inputCommitted to delivering an outcome
RiskClientService Provider
EngagementFull timeFull-time/Part-time
ManagementClientService Provider

 Grow Your Business with us

There you have it, that’s how staff augmentation vs. managed services models compare. Staff augmentation adds an expert to work with your team to deliver a project while managed services providers work independently to deliver the project as defined.

PlumLogix helps businesses with Salesforce-managed services to extend your team’s capabilities to achieving digital transformation goals. We help you grow your business and become more effective. Get in touch and let us grow your business together!