In the information technology industry, a lot of companies try to reduce their operational costs, improve project efficiency, while still meeting their technological needs by using either an IT staff augmentation or project outsourcing business model. Each of these models operates in a different way, suits certain business scenarios, and has a direct impact on project execution and lead time. This is why it is important to understand the main difference between the two and when to consider one over the other.
The main difference between these two models is who has control and where the project development takes place. With IT project outsourcing, the project’s control, development, and requirements are defined by the company you hire to get the job done. It is their responsibility to manage the project, show a final product, and deliver results. The IT staff augmentation, on the other hand, brings in software engineers to work alongside your team and gives you complete control and oversight of the project. In some cases, if you bring a software engineer on-board for a short-term contract, their provider will pay for the time, salary and social security payments, which reduces overall operational costs.
If you were to choose an information technology project outsourcing company, the provider that takes you on would be in complete charge of the project’s entire management and delivery process. This means that they are responsible for managing the project, testing it and showing the final product with the desired results. You would choose this option if:
Whenever you are completing a project that requires a certain technical skillset, it is important to evaluate what resources your company has access to first and see you have the talent required to do the job. If your project requires certain knowledge for completion of your project does not require an in-house team at all, outsourcing is the more effective model to go with.
Deciding on IT staff augmentation places you in complete control over the project and its development. This is because any programming or engineering staff brought on would work alongside your team under your management. This option is ideal if:
This is the more effective model for projects that require certain skill sets, in-house or on-site cooperation and short-term contracts or negotiations.
Projects are not always simple and may require multiple segments, each with its own needs. In this case, a company may prioritize getting the job done within the given time constraints, rather than deliberate over which option is more preferable. For example, one portion of the project may be completed more effectively via outsourcing, while the other may require more in-house management.
Often, the most important requirement of a hybrid approach is an effective method of communication, as the end goal of the project must align with all parties involved in its completion. This could be achieved by a general knowledge base that all participants work from and contribute too, thus providing a better perspective.
The model you eventually choose to work with is important, but priority should always fall on whether or not you can find a project partner that provides high calibre deliverables. If you can’t find an outsourcing company that can provide a high-quality product within the allotted time frame, then it may be better to augment your own staff. This will help you avoid additional budget expenses that would increase overall operational costs.
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