IT Staff Augmentation vs. Outsourcing: What’s the Difference?

Growth is the main keyword in so much of today’s economy. After all, everyone’s in it to win it. You want to expand your operations, enlarge your potential, and boost your profits. The IT industry is no exception. What happens when you want to embrace new operations, develop a new product, or offer a new service? You’ll need the power of fresh new talent to fuel your vision. There are two ways of going about this which have proven popular (and effective) in recent years: staff augmentation and outsourcing.

Both are terms that are tossed about quite a bit in the IT community. They cover similar strategies and are similar in certain aspects yet they come with starkly different pros and cons.

So let’s compare. Let’s have a showdown. Staff augmentation vs. outsourcing. Bring it on.

What is staff augmentation?

This may sound slightly confusing at first but staff augmentation is actually an outsourcing strategy. It’s a way of responding to business objectives by evaluating the existing staff and filling in the existing talent gaps.

For example, your team may be great at developing traditional mobile games but lack the skills needed for an augmented reality (AR) project. What should you do? Simply hire a couple of experts in the field from a third-party company and keep it moving. Basically, staff augmentation is all about combining your existing talent with a few useful additions. It really is as simple as that.

The pros

There are multiple advantages to staff augmentation. Here are the most substantial ones.  

1. It’s cost-effective. You are relying on your existing staff and resources and only making new additions to the team when absolutely necessary. You pay for the job done and avoid recruitment and hiring costs.
2. It gives you more control over your project. The work happens internally, under your watchful eye.
3. It provides extra expertise. You have the luxury of hiring a person with just the right experience and skill set. Just make sure you communicate project requirements clearly.  
4. Scalability. You can add or remove external members to your team as you need them. There aren’t long-term contracts, as you’ll only collaborate with augmented staffers for the time of your choosing. 

The cons

The challenges of staff augmentation are less numerous but still well worth mentioning.

1. Training. Even the greatest expert in the world will need to be told what to do. A bit of training will be necessary and may slow down your process.
2. Responsibility. Nearly everything happens internally. This means that both the development and quality control are on your end.

Outsourcing in the traditional sense of the word

Outsourcing tends to be a bit more comprehensive. Traditionally, it’s about hiring a designated team or even an entire company for a specific project. Let’s say your business specializes in selling clothes but needs a good, robust website. It’s highly likely that your in-house team won’t be able to pull that off. 

So what’s the most effective strategy? For this specific task, you’ll simply hire a team of web designers, knowing that your project is in safe hands. Provided that you pick a good crew, you definitely won’t need to oversee every part of the process.

The benefits

The pros of opting for outsourcing give us a clear idea of why larger businesses favor this practice.

1. Project management happens elsewhere. This is something that can be fully delegated, meaning less of a drain on your human resources. This keeps your own team members free from distractions and focused on your core tasks. 
2. Hiring an entire team actually requires less training. This is particularly true if your company doesn’t have any legacy or proprietary systems.
3. Hitting deadlines. Internally, project timescales tend to be negotiable. An outsourced team is more likely to meet deadlines as their success and reputation depend on reliability.

The drawbacks

Of course, we can’t address this topic without also covering the most important cons of outsourcing as a whole. 

1. Less control over your project. Once you establish the goals, deliverables, and deadlines, the execution of the project happens elsewhere. This gives you less direct insight into what’s going on.
2. Not great for smaller businesses. When considering staff augmentation vs. outsourcing, the latter tends to work better for large-scale projects. If you have a team of 5 and need to delegate some tasks to a team of 10, this may put a huge strain on your budget.

The differences between the two

So how do the two approaches compare? When it comes to staff augmentation vs. outsourcing, there are several key differences to consider.

1. The number of people you hire. With staff augmentation, it may be as low as one or two experts. Outsourcing, on the other hand, normally means you need an entire team. Think of it as focusing on required skills vs. required tasks. 
2. Working and organizational culture. Individual additions will often mean the entire team will be working side by side, able to form bonds. A totally separate team present in outsourcing, on the other hand, will be its own ecosystem. The way of managing each will be quite different.
3. Project management. In outsourcing, you’ll have a designated project manager. They will act as a single point of contact. In staff augmentation, your own project manager will lead the external hires. 
4. Staff augmentation tends to suit shorter, ad hoc projects. Outsourcing, on the other hand, is better for larger projects and ongoing tasks.

Staff augmentation vs. outsourcing — when should each be used?

At this point, it’s quite obvious that each comes with a unique set of perks. Neither is better or worse per se, they simply cover different requirements. The choice between the two will largely depend on the size, complexity, and duration of your project. Take the time to answer these three questions:

• What are your goals?
• What is your team’s current capacity?
• What is your budget?

These may allow you to get greater insight into your situation and make the best choice. If, however, you still can’t decide, consider implementing both for different purposes. Yes, a hybrid approach is perfectly possible. In the ever-evolving world of IT, you sometimes have to mix and match.