Resource Augmentation Services vs Outsourcing – Everything You Should Know

Many people believe that resource augmentation services and outsourcing are the same thing. While it’s true that both are cost-efficient alternatives to expanding your workforce, they each meet very different business needs.

If you’re still a little unclear about which of these is what, the following lines are for you.

What is Resource Augmentation?

Resource augmentation is a strategy that enables businesses to temporarily supplement their workforce or resources by hiring additional personnel.

Hired on a contract or project basis, the additional individuals work alongside your team and under your management. That way, they complement existing capabilities without the long-term commitment or overhead associated with full-time employees.

The Pros of Resource Augmentation Services

The market for resource augmentation is rapidly growing as businesses discover its benefits. Some of the significant ones you should know of are – 

• Specialization – No project is beyond your team’s capabilities when you can bring in specialists to fill the necessary roles. This allows your team to focus on building sustainable skills while you save on training expenses and time investments.
• Control – Augmented resources remain under your supervision since they act as an extension of your team. This gives you full control over their tasks and output.
• Cost-Efficiency – Resource augmentation services are a cost-efficient alternative to traditional hiring and specialized training. As they’re short-term commitments, they enable you to scale your workforce responsively.
• Speed – The recruitment process for supplementary staff is much faster than drawn-out traditional hiring. Therefore, your augmented team can begin complex projects on short notice.

The Cons of Resource Augmentation

Despite their numerous benefits, resource augmentation services come with their own set of limitations –

• Project Overhead – While augmented resources are cost-effective, they come with their own set of costs. For instance, you’ll need to cover onboarding costs and additional software licenses.  Your project managers too will have to juggle additional tasks, deliverables, and resources. This will likely increase management overhead.
• Communication Issues – Especially when working with offshore talent, collaboration can be a challenge due to different time zones and language barriers. A lack of clear, timely communication can cause misunderstandings and delays.
• Onboarding Time – New hires won’t know your company culture, preventing them from fitting quickly into a team with a pre-existing workflow. So, you’ll need to spend time (and effort) to integrate them.

What is IT Outsourcing?

Compared to resource augmentation services, outsourcing involves delegating entire services or business functions to a third-party organization.

Basically, the outsourcing company’s team takes over your project, independently completes it, and shares responsibility for the result. With this approach, you get to balance external capabilities while maintaining efficiency and competitiveness.

The Pros of IT Outsourcing

Currently, the global market size for IT outsourcing is at a staggering 617.69 billion USD. These advantages are some of the reasons for such a high number:

• Increased Efficiency – Outsourcing providers pair you with a specialized team that has a streamlined workflow and knows how to work together. That way, you can get better results faster.
• Lower Management Overhead – Though outsourced teams work on your projects, they operate independently, allowing you to cut back on management overhead.
• Global Resources – It takes time to assemble and train an in-house team for specific projects. You may also have trouble finding the right people locally. Thankfully, IT outsourcing offers access to global talent, giving you a competitive edge.
• Focus on Core Functions – Through IT outsourcing, your company can leave non-core tasks in capable hands. Not only does this save on in-house expenses and resources, but it also frees up your team to focus on what they do best.

The Cons of Outsourcing Projects

Before signing the dotted line, you should know about the risks of outsourcing your next project.  

• Lack of Control – Outsourcing projects is a relatively hands-off approach: you have little say over the workflow and outcome. It requires good communication and trust, so your choice of partner must be carefully vetted for output quality.
• Security Risks – You may need to share certain sensitive information with your new team. But once it’s with them, it’s out of your hands. You won’t be able to dictate their security protocols or what they do with your data.
• Prep Time – Your outsourcing partner will need documentation and prep time before starting the work. So, having them work on time sensitive or urgent projects can be risky.

Resource Augmentation vs Outsourcing – When to Choose Which

Just knowing their pros and cons may not be enough to help you choose between resource augmentation services and outsourcing. To ensure you make the right choice for your project, here are five factors you should include in your decision-making.

1) Function

Resource augmentation companies provide temporary staff to supplement your team. Armed with specialist skills, they adopt specific roles to tackle projects that would otherwise be beyond your team’s scope.

Outsourcing vendors, on the other hand, take on your projects themselves. They manage their teams and share responsibility for the final product.

2) Onboarding Process

Onboarding augmented resources is quick and easy – all you need to do is find a specialist with the required experience. Once that specialist joins the team, they can get started on your project right away.

Outsourced projects must be planned out from start to finish, and all contracts finalized before they can begin. So, you need to clearly communicate tasks, objectives, and deliverables. Especially since they’ll be working independently.

3) Management

Whether remote or on-site, augmented resources are under your management. This means more effort for you, but better cohesion and collaboration for your team.

With a separate management structure, outsourced teams typically won’t interact much with your team. While there’s less risk of conflict or clashing ideas, they won’t develop a collaborative relationship.

4) Knowledge-Sharing

Resource augmentation services are ideal for supplying your team with fresh ideas from an expert perspective. A supplementary worker reinforces your team’s technical and nontechnical knowledge.

When outsourcing a project, you are placing your trust in the vendor’s expertise. And since process is one of their greatest assets, they’re unlikely to share their resources or development insights with you.

5) Cost

Resource augmentation services tend to be more expensive than IT outsourcing. Your company pays them a regular wage and supplies them with the tools they’ll need. But the model’s flexibility allows you to change your team’s size according to demand.

On the flip side, outsourcing can get you a whole team of specialists for less. The rate can drop even lower depending on regional labor costs. But unless you hire a reliable vendor, you may be surprised by a few hidden costs.

Leaning Toward Resource Augmentation?

You’re in the right place. With decades of experience, DPL’s experts have a range of specialized skills to fill any current gaps in your team. Our tech professionals will bring you invaluable expertise and innovative thinking to help you stay ahead of the curve.

Use the form below to connect with us and learn more about our resource augmentation services. Let’s find the talent you need to make your project a reality.