The process of hiring new permanent resources is tedious, costly, and time-consuming. In fact, fulfilling a company’s staffing needs can emerge as one of the most challenging tasks for any business owner.
Hiring new employees is not the only thing staffing is concerned with. Instead, it involves putting in place mechanisms and processes that retain the employees by keeping them motivated. Moreover, it consists of training the employees to enhance their skillset and ensure they are useful for business growth.
But what do business owners do if an employee suddenly quits after training? Or how does an HR outsourcing challenges meet staffing requirements when a new project is undertaken?
The answer is staff augmentation.
This article explains implementing staff augmentation, how it functions, the cases where it is used, and its benefits. But most importantly, it offers five tips on how to implement it for your organization successfully. Moreover, this article sheds light on the different strategies used for resource augmentation.
What is staff augmentation?
Staff augmentation is the practice of hiring resources through an outsourcing model. It involves reaching out to third-party vendors who supply resources to the outsourcing company, usually on a temporary basis.
In other words, resource augmentation is a flexible hiring model focused on augmenting the workforce capacity of a company. Third-party vendors, also known as service providers, find and contract talent across the globe to meet a company’s staffing needs. We shall explain this further when we talk about resource augmentation strategies.
How does it function?
For instance, suppose Company A is looking to hire a full-stack developer for a new IT project. Company A lays out the skills and work experience it is looking for in the new resource. These requirements are then shared with a third-party vendor. The vendor then either provides the resource from its pool of employees or finds a new resource that meets Company A’s requirements.
This is referred to as IT staff augmentation. Resource augmentation is nothing new. Companies have always wanted to hire new resources temporarily for multiple reasons. These include the death of an employee, a sabbatical by an existing employee, meeting staffing needs for a new project, etc.
Alternatively, Company A can simply outsource the entire execution of the new IT project. But this is project outsourcing and you must not confuse it with staff augmentation. Both are different and distinct outsourcing models.
Let us now talk about the cases where staff augmentation is used as a hiring strategy, followed by its benefits.
Cases where staff augmentation is used
There are many cases where companies can choose external resourcing as a flexible hiring model. Let’s briefly explore the three most common such cases.
Case 1 – One of the most common reasons for resource augmentation is to supplement the capabilities and capacities of the existing workforce. There can be multiple reasons for it, including the completion of a new project. Companies turn to this kind of hiring to ensure new projects are completed in a timely and efficient manner while significantly saving their hiring costs.
Case 2 – Businesses also employ resource augmentation when an existing employee dies or goes on a sabbatical. Moreover, a business may choose to employ a resource first hired through resource augmentation permanently. This is usually the case when the temporary employee fulfills the requirements of the outsourcing company and fits well with its culture.
Case 3 – Imagine a company looking to revamp its business model, going from a traditional way of doing business to AI-powered business processes. In such a case, businesses often turn to resource augmentation as a means to temporarily fulfill their staffing needs.
So, while a company may look to hire somebody permanently for new positions, it makes do with staff augmentation in the meantime. Thus, this fluid hiring model serves as a bridge, a makeshift arrangement, so to speak.
Also Read: Future of Outsourcing Trends 2022
However, temporary employees hired through outsourcing are sometimes elevated to permanent positions, given that they meet the needs of the outsourcing company.
Advantages of resource augmentation
There are multiple benefits your company can expect to reap by using a flexible outsourcing hiring model. Here are some of the significant advantages of implementing staff augmentation.
- A highly skilled and competent augmented staff efficiently responds to new workflow needs and delivers accordingly.
- Outsourcing talent acquisition via resource augmentation saves your business money and precious time by bypassing the traditional hiring process.
- External resourcing allows a company to weather the impact of an economic recession by virtue of its flexibility. You can hire or let go of externally resourced employees if necessary.
- This hiring model is particularly beneficial for companies that operate seasonally. They can hire and let go of employees without accruing significant onboarding and redundancy costs.
- It is the third-party vendor’s responsibility to ensure that the right resources are offered to the outsourcing company. Failure impacts the service provider’s reputation more than the outsourcing company’s operations.
- Although augmented staff usually works off-site (mostly on-premises of the service provider), the outsourcing company closely monitors the performance of the resource. Effective appraisal means that the resource knows what is expected of it, thus giving the outsourcing company control over it.
- Resource augmentation helps companies build vibrant and dynamic workforces in cultural and skillset terms. This allows you to create new competencies, that can then be leveraged to drive business performance.
Different staff augmentation strategies
- On-site augmentation – This strategy refers to hiring temporary employees on-site to supplement the capacity of a company’s existing workforce. IT firms usually employ this strategy because they often require the presence of a resource on-site for tech workers and other reasons.
- Onshore augmentation – An onshore augmentation strategy refers to hiring a resource that resides in the same country as the outsourcing company. However, the two may not be in the same city or town. The main advantage of this strategy is that it allows the resource and the best IT company to operate in the same time zone.
- Nearshore augmentation – A nearshore augmentation strategy refers to hiring a resource that resides close to the country where the outsourcing company operates. These resources usually belong to neighboring countries, hence the term nearshore. Moreover, the main advantage of it is that the time difference between the resource’s country and the company’s country is only a few hours.
- Offshore – As the name itself suggests, an offshore augmentation approach is a practice of hiring resources that are far away from the outsourcing company’s country. Why do companies employ offshore resources? So that they can save on labor costs. Developing countries are often the best place to find skilled and cheap labor.
Now that you are armed with all the relevant information about resource augmentation let’s look at how you can successfully implement it.
Here are 5 tips for effective staff augmentation implementation.
5 tips for effective staff augmentation implementation
- Setting goals and milestones – Establishing realistic and achievable goals are critical to successfully implementing staff augmentation. What specific goals do you wish to achieve by hiring externally? Before implementing a staff augmentation strategy, you must identify your goals, timelines, workflows, particular tasks, and outcomes.
- Identify skill gaps – You must recognize your workforce’s skills and those they lack. This will allow you to hire resources that fill the skill gap in your workforce without doubling up on existing skills.
- Select the right vendor – It is also imperative that you find the right vendor for your resource augmentation. Ideally, looking for a service provider that espouses the same values and culture as your own company would be best. Moreover, it is worth remembering that no two vendors employ the same hiring strategy; each has its own. Choose the one that best fits your requirements.
- Team synchronization and motivation – Establishing and building good working relationships between team members is essential for achieving business goals. Your objective should be to keep your team – internally or externally hired – motivated and driven. Moreover, you should give special attention to remote employees. You should take every step to ensure that they feel as much a part of the team as on-site resources.
- Effective leadership – Good leaders make great teams, and great teams make great companies. All staff, especially externally hired staff, requires good leadership to achieve its potential. Micromanagement should not be your focus, but providing guidance, help, and positive feedback is necessary to gain the most out of your augmentation drive.
In the light of the above information, it can be safely concluded that implementing staff augmentation is a powerful and dynamic hiring strategy. It propels companies towards greater efficiency by flexibly meeting their staffing needs.
The covid19 pandemic has given immense rise to the outsourcing industry, of which resource augmentation is one part. We can expect this industry to rapidly grow and evolve as companies shift to more innovative ways of achieving their goals. Follow these tips to ensure the successful implementation of your staff augmentation drive.
In case you need further guidance on resource augmentation, feel free to reach out to us at [email protected]