What Is Staff Augmentation And How It Could Work For Your Business?

Tech companies of all sizes use staff augmentation to access talent at warp speed. But this hire-on-demand strategy is especially useful for companies that need to tackle bottlenecks or quickly skill up for specific projects.

Why? Because it allows smaller teams to grow instantly in response to changing deadlines or market shifts.

In 2022, the global IT services outsourcing market was valued at $639.59 billion, and it’s expected to grow at a compound annual growth rate of 8% leading up to 2030.

These numbers prove that companies worldwide are turning to tech talent outsourcing to help them scale their operations.

In particular, IT staff augmentation can be an excellent alternative to traditional outsourcing and freelancing for startup ventures requiring specific expertise.

If you’re thinking about using this approach, you probably have lots of questions. Let’s dig deeper so you can decide if it’s the right direction for your project.

In this article

• The staff augmentation meaning
• The rise of staff augmentation: A historical perspective
• Different types of staff augmentation
• Different models of staff augmentation
• Benefits of staff augmentation
• The process of hiring a staff augmentation services
• Best practices for a successful staff augmentation approach
• Challenges and mitigation strategies in staff augmentation
• The future of staff augmentation solutions

The staff augmentation meaning

Staff augmentation means temporarily outsourcing talent for your company’s immediate needs. These workers become a part of your team for the length of time you need their skills (usually for the duration of a project).

Staff augmentation is different from other outsourcing models. For example, you’re not hiring a dedicated team of developers (a.k.a. managed services) that will work autonomously.

Instead, augmented staff work alongside your in-house staff — they join your team temporarily, use your tools and processes, and sometimes share your office space (unless they’re working remotely).

As you can see, augmented staff is a flexible and efficient solution for startups and enterprises looking to hire experts without the costs and complexities of long-term commitments.

The rise of staff augmentation: A historical perspective

The tech boom of the 1990s exposed a scarcity of skilled professionals in emerging technologies. Many companies wanted to seize new opportunities, but they found that their in-house teams either lacked expertise or were already stretched too thin. 

The solution was team augmentation. Everyone started using it — from garage innovators to well-funded pioneers. Even Microsoft used temporary workers for software development in its early stages. Despite some controversy, this decision ultimately cemented its position as a tech powerhouse.

With wallets tightening during the 2008 financial crisis, the staffing model became an attractive strategy even for large, traditional companies. General Motors, for example, turned to augmented staff to maintain essential operations while weathering the storm.

Fast forward to today, and staff augmentation is bigger than ever. Cloud computing and remote work have made it easier to access global talent, letting both startups and big players use this strategy to stay agile and fill talent shortages. 

Different types of staff augmentation

Here are the three main types of staff augmentation:

Commodity	It is ideal for when you need extra hands for non-specialized work for a limited period. It addresses increased labor demands during peak seasons or large-scale events.	Common in manufacturing, warehousing, and event management.
Skills-based	It is best suited for businesses that need task-specific jobs done temporarily.	Often used for clerical work, basic data processing, or transcription services
Highly-skilled	This category requires workers with highly developed and specialized skill sets (often a result of extensive training and experience).	It’s the most common type of staff augmentation used in software engineering, e.g. for mobile app development.

Different models of staff augmentation

There are also different models of staff augmentation, including:

On-site vs. remote augmentation 

On-site augmentation means bringing talent physically into your offices to work alongside your team. This model makes sense if your team predominantly operates from an office and the augmented staff are local. 

In contrast, remote augmentation means hiring talent from anywhere in the world to work remotely. Many tech companies that want access to a global talent pool prefer this arrangement.

Short-term augmentation vs. long-term augmentation 

Short-term augmentation lets you engage extra staff only when necessary, like when handling peak workloads or covering for absences. 

Meanwhile, long-term augmentation is suited for ongoing projects or continuous initiatives. It can create more stability as augmented staff become more familiar with your company’s goals and processes over time.

Benefits of staff augmentation

Staff augmentation comes with lots of great benefits. Here’s just a quick look at some of the best:

• Flexibility – Staff augmentation adapts to your project’s evolving needs. Because you’re not locked into rigid team structures or limited skill sets, you can tailor your team’s composition as your projects evolve.
• Access to a global talent pool – Forget long training cycles. With staff augmentation, you can instantly work with experienced professionals who are ready to add value right off the bat.
• Cost-effectiveness – Traditional hiring is expensive — recruitment costs, training, and employee benefits add up quickly. Staff augmentation is more economical for short-term needs, especially when using models like nearshore software development. It reduces expenses related to recruitment, overheads, and employee benefits expenses, which means you can redirect these funds to support other areas like sales and marketing.
• Scalability – Staff augmentation allows you to scale your operations to match market demands without the risks associated with traditional staffing. You can hire precisely what you need, when you need it, without committing to a full workforce.
• Faster time-to-market – Bringing in skilled professionals can increase your overall operational efficiency. These pre-vetted and trained experts integrate with your team seamlessly to speed up processes and shorten your time to market.
• Risk mitigation – This hiring model lessens the risks associated with permanent hires. You only commit to temporary staff — a far less binding arrangement than full-time employment. Partnering with an external company also lets you share the inherent risks of software development, reducing the burden of managing technical challenges.

Read more about these benefits in our in-depth post: 6 Excellent Benefits of Staff Augmentation For Your Business

The process of hiring a staff augmentation services

It’s easy to get started with staff augmentation as long as you understand your project’s requirements. Here’s a step-by-step look at the process:

1. Identify skills gaps and needs 

Analyze your team’s capabilities and align them against your project’s demands. What’s missing? Pinpoint the specific skills and roles you lack — maybe a Flutter developer or a Blockchain expert?

2. Decide on the right team size 

Crunch the numbers. How many extra hands do you need? Factor in your project’s scale and duration. The greatest thing about augmented teams is their flexibility — you can scale up or down as needed.

3. Choose your model

Remote staff augmentation gives you flexibility and a wider talent pool, while on-site staff augmentation can provide better control.

Decide if the project’s complexity requires frequent face-to-face interactions.

Should you hire long-term or short-term? The right choice is what matches your project’s runway and budget considerations.

4. Partner with a staff augmentation company

Find a reliable partner who knows the ropes and understands your goals. The best staff augmentation companies have established teams of pre-vetted talent with diverse skill sets and experience levels.

They can align with your timelines and provide flexible engagement options like hourly rates, fixed-cost projects, or even dedicated teams.

5. Candidate matching

At this stage, your partner agency will line up candidates matching your criteria. Expect to sift through profiles and conduct interviews to find the right cultural and technical fit.

6. Interviews and selection

As you sit down with each potential hire, assess their technical and their soft skills (like communication and teamwork). You want someone who will get along well with your team.

7. Hire and onboard

Once you’ve picked your augmented staff, the agency handles the legwork, from legalities to payroll.

You can then start onboarding. Introduce your new members to your internal teams and train them on your company’s tools and processes.

Best practices for a successful staff augmentation approach

These best practices set the stage for a successful and productive team augmentation experience:

• Clarity is key – Provide detailed job descriptions, outline project milestones, and establish performance metrics. For a developer role, for example, you must specify deliverables (like code reviews and unit tests) and set deadlines for each task.
• Security first – Establish security protocols (like access controls and two-factor authentication) to protect sensitive information. Define what information is considered confidential in plain, unambiguous language. You may also want augmented staff to sign a non-disclosure agreement.
• Communication is essential – Set up communication channels with augmented staff and your internal team. Use dedicated communication platforms (like Slack) to establish a clear process for reporting issues or concerns.
• Welcome and integrate – A friendly environment fosters belonging and productivity. You could organize a welcome lunch or a virtual coffee chat if you’re working remotely. You can also assign a buddy from your internal team to help your new members acclimate.
• Knowledge is power – Train your augmented team on internal processes, project management software, and internal documentation (like coding standards and style guides). Provide access to relevant knowledge base articles. This lets them better understand your workflow and contribute effectively. 
• Stay connected – Regular check-ins put everyone on the same page, so keep the dialogue going. Conduct weekly one-on-one meetings to discuss progress and hold bi-weekly team meetings for project updates and brainstorming.
• Embrace differences – Respect and understand cultural and time zone differences. Be flexible with meeting times and offer intercultural communication training to your internal staff.
  Scale smartly – Anticipate and adjust your team size as your project evolves. Regularly review project progress and resource utilization. You should also plan for potential future phases that might require additional skills.
• Give credit where it’s due – Never skimp on appreciation. Recognize and value the contributions of your augmented team. Publicly acknowledge their contributions during meetings. Even sending personalized thank-you notes for exceeding expectations goes a long way. If possible, consider offering performance-based bonuses or additional project opportunities. 

To dive deeper into staff augmentation best practices, read up on how to manage IT staffing augmentation on our blog.

Challenges and mitigation strategies in staff augmentation

Despite those great benefits, the staffing models do come with its own set of unique challenges. Here are some you might encounter and how to solve them:

Finding the right talent

The tech industry is highly competitive, making it tough to find professionals with the specific specialties your project requires. This is particularly true for relatively new niches like Blockchain, or AI.

Solution

Collaborate with a staff augmentation company that has an established talent pool. This can broaden your search beyond local candidates.

Managing relationships between in-house and augmented staff

Integrating new team members can disrupt existing dynamics, resulting in communication issues and reduced productivity. 

Solution

Foster a collaborative environment with regular meetings, team-building activities, and clear role definitions. Provide training and support for augmented staff to assimilate them into the company culture.

Ensuring high-quality work

Monitoring and managing remote augmented teams can be challenging. Any lapse in oversight may lead to potential delays and quality issues.

Solution

Implement precise performance metrics and regular check-ins. Use transparent project management tools to track progress.

Transferring institutional knowledge 

Inconsistent knowledge transfer can lead to inefficiencies, missed deadlines, and quality issues.

Solution

Develop comprehensive process and workflow documentation. Invest in tools and strategies that facilitate efficient knowledge sharing, such as wikis and internal forums.

Maintaining security

Working with remote teams poses data security and compliance risks. 

Solution

Enforce strict security protocols and work with a staff augmentation company that has verified qualifications, conducted background checks, and contacted references before you even see a shortlist of candidates.

The future of staff augmentation solutions

Three major trends are changing how businesses access skills and expertise:

AI-driven talent demand

Artificial intelligence is creating a huge demand for tech talent, and businesses are increasingly relying on staff augmentation for AI expertise.

As blockchain and IoT technologies continue to develop, the demand for specialized skills in these areas is also set to rise.

Companies looking to automate processes or bolster security will actively seek experts in these emerging industries. Staff augmentation will be key in sourcing this specialized talent.

The shift to remote work 

Widespread remote-first work has streamlined staff augmentation. Teams accustomed to off-site collaboration can integrate augmented staff more effectively.

Plus, with more tech professionals preferring to work remotely, businesses can access a broader talent pool.

However, telecommuting brings challenges like communication barriers and cultural differences. Companies using and providing staff augmentation will need to implement robust new strategies for seamless team integration and collaboration, such as cross-cultural training programs.

The growth of microcultures

One of the key considerations when running a business of any size is creating a good company culture.

In this context, “culture” refers to the overall ethos of the organization, how colleagues work together, and a feeling of belonging and pulling towards the same goal. It is one of the first questions many prospective employees ask during an interview and is something good interviewers will asses in new hires.

However, as companies grow larger, creating a unified culture across many different business units and potentially hundreds or thousands of employees can become almost impossible. This leads to a disjointed workforce and new hires feeling as though they have been lied to.

Instead, companies should focus on fostering microcultures throughout the organization. These “cultures within cultures” should still follow the basic ethos, values, and direction of the wider organization but be flexible and adaptable to the individual needs of business units and teams.

By creating microcultures, companies can create a shared sense of purpose, mentality, and direction in teams that work closely with one another every day, while still promoting organization-wide cohesion.

In turn, this prevents individual units from feeling like they are not seen or that their goals and ways of working are not subsumed into the amorphous goals of “The Company” that don’t truly represent how they work.

Want to learn more about staff augmentation services?

We have a blog all about our staff augmentation approach with lots of great detailed information.