Blog / Managed IT Services vs. Staff Augmentation
As computer and information technology continues to advance and expand, more jobs are being pushed online or taking on an online component. This means more password resets, more security risks, and more onboarding and hiring expenses. As a result, businesses without managed IT services can become reliant on increasingly expensive IT departments to keep running. Staff augmentation, on the other hand, gives businesses the ability to cope with the increasing demand for IT skills, improve their technical agility, and occasionally get around pesky hiring restrictions.
But what exactly is staff augmentation? It’s literally what it sounds like; a business augments its existing staff with new IT personnel to handle temporary additional workloads/requirements. To use a simple but straightforward analogy, it’s like Walmart hiring new retail staff during the Christmas season, except instead of cashiers the business is hiring to cover additional needed IT cycles.
Staff augmentation is a great model for covering off short-term skill deficiencies, as the costs for temporarily hiring someone with the needed skillset are typically much smaller than for hiring a long-term, dedicated resource. Staff augmentation also makes scaling up (or down) simple, and the associated costs are easily predictable (just multiply the personnel’s rate by their hours worked). These are just a few of the benefits of staff augmentation for handling short-term IT requirements.
But if staff augmentation is so great, why should you bother to use a managed IT services provider? Simply put, staff augmentation is only economically viable in the short term and on specific projects because placement companies charge premiums for their scouted talent. As the term of an engagement stretches on, the benefits begin to wane. The higher labour costs that were offset by avoiding hiring costs is lost when your short term staff-augmentation becomes a long-term relationship. Worse, your business could even become reliant on staff augmentation as a means of meeting labour needs, resulting in staff creep when external contractors that were hired on for short term projects wind up embedded in your organization as high-cost permanent staffing.
However, while there are real cost pitfalls involved with engaging in long-term staff augmentation commitment, there is also a serious conceptual pitfall that business owners may want to consider as well. It’s the difference between committing to an input, as opposed to an outcome. For example, when you augment your IT staff, you’re bringing in personnel to handle tasks. Hopefully the new staff will meet your target objectives and deadlines, but the risks for project overruns or delays still rests with you. On the other hand, when you outsource to a reliable provider, you’re getting a commitment to an outcome. You get a service level agreement, transferrable knowledge documents (contractors have no requirement to document anything unless you specifically mention the requirement in their contract, making knowledge control another concern), and the provider is taking on most of the additional IT risks.
In effect, long-term staff augmentation is an inefficient way to outsource as it carries a high cost and high risk, and with little to no commitment. Adopting a true managed IT services provider is a far more cost-effective and efficient way of meeting your long-term IT requirements. If you’d like help transitioning to a managed IT services provider, contact TRINUS today.
