#managed services model

Staff Augmentation Model Vs Managed Service Model? Which Is Better

Quick Summary: What could be the most important asset for a company? The answer is- its employees. Finding the right team of professionals is crucial for the long-term success of any organization. And now, businesses have more hiring choices than ever. With the sudden rise in remote work trends, companies no longer need to limit themselves to traditional methods of hiring in their own geographic location. They can now explore talents worldwide. CEOs are now more and more interested in outsourcing staff for project development. In fact, the global outsourcing market is estimated to reach $260 billion and is expected to double by 2030. With this surge in outsourcing, it's crucial to understand the different models available–Managed services and Staff Augmentation–each with its own benefits and risks. Let’s compare both of them so that you can determine which one is right for your project! 

What is Staff Augmentation? 

Staff Augmentation is a model in which companies give temporary contracts to professionals from outside of their geographical areas to quickly fill in the skill gap within their current team. Companies can find talents onshore, offshore, and nearshore to scale up their team based on demand. They can do resource augmentation for various stages of the project development process separately, like programming specialist, workflow optimization, quality engineer or security encryption professionals. As a result, they can overcome roadblocks like time constraints, budget constraints, fixing bugs and product launch delays.  

What are Managed Services? 

Managed services is an outsourcing business model in which a company can delegate certain functions to a third party–known as managed services provider or MSP. Businesses can leverage the latest technologies and remote working to communicate effectively with the MSP. Anything like cybersecurity, database management or software development can be outsourced virtually to the managed service providers. As opposed to joining the company permanently, managed service providers operate from their own workplace while providing the client with a quote and project timeline. They work on their assigned task matching the professionals with required skills. In the meanwhile, the company can focus on other important managerial tasks.  

Pros and Cons of Staff Augmentation 

Pros- 

Flexibility in staffing- You can increase or decrease your staff as per the project demands. In fact, you can save more with staff augmentation as individuals that join your team tend to work faster and meet deadlines. 

Meeting deadlines- As staff augmentation models help you fill in the skill gaps within your in-house team, there is no need to pause or halt your current work processes. You can continue with your routine work and business projects hassle-free. 

Complete control of the project- In this model, you have full control over your project timeline, execution, and quality. Your project deadlines won’t be compromised and unexpected roadblocks are less likely to arise during the process. 

Skilled professionals but cost-effective- Staff augmentation is an affordable solution when your in-house team lacks specific skills to perform a task or successfully execute a project. It saves time also, as you no longer need to train these people for the technologies and specialized skills. You also don’t need to keep them for long, and give them a full-time salary, rather you can pay them for as long as they are associated with you. 

Cons- 

Need to have an excellent internal team- In order to establish an automated system with the remote professionals, your in-house team should be an expert in communication and conveying the project requirements efficiently. 

Suitable for short-term projects- Staff augmentation is only suitable for short term projects. If you have a long term one, staff augmentation is not an affordable option. Hiring in-house would be a more beneficial and cost-effective one. 

Pros and Cons of Managed Services

Pros- 

Dedicated project management- If you hire a managed services company, you won’t need to look after every little aspect of your project development. Expert service providers usually take the full responsibility of required tools and technologies to ensure a smooth workflow that doesn’t require your attention and management. 

Skills and talent- Instead of putting together an entire in-house team, you have the access to a dedicated team of experts who have the right tools and technologies at their disposal and can start with your project right away. 

Hassle-free management of professionals- Even if you hire professionals, they may have to quit the project in between, due to professional or personal reasons. And this means you have to repeat the hiring process, consuming most of your time and efforts, while leaving the project development in between. With managed service providers, you are free of tedious management of professionals, as they take full responsibility of their staff. 

Access to premium versions of technologies without the associated cost of ownership- Managed service providers purchase a variety of premium versions of technologies and tools so their clients don’t have to spend extra bucks on them. Moreover, their team knows how to use them efficiently in different IT projects as per the demand. 

Cons-

Less communication required- Managed service providers do the communication with their staff. So if you want to be actively involved throughout the process, they won’t let you do so. 

Potentially higher costs- Managed service providers charge more, as they have a full-blown team, tools, and access to premium versions of technologies being used in the projects. 

Conclusion

Staff augmentation and managed services both are beneficial for businesses to complete IT projects. While staff augmentation works great for short-term projects that require flexibility and specialized needs–managed services are better suited for projects that need long-term assistance and companies who wish to outsource entire services. In either model, our company provides full assistance and reliable services for your next project, feel free to contact us! 

Original Source: https://braininventory.in/posts/staff-augmentation-vs-managed-services/2084 

FAQs

Which model is more suitable for long-term projects?

Managed services are generally more suitable for long-term projects or ongoing functions because they involve a comprehensive outsourcing arrangement where the provider handles all aspects of the service. Staff augmentation is often better for short-term needs or projects that require specific skills for a limited time.

How do costs compare between staff augmentation and managed services? 

Costs can vary significantly between the two models. Staff augmentation typically involves paying for the individual resources hired, which can be more flexible and potentially cost-effective for short-term or highly specific needs. Managed services often come with a fixed contract price for the entire project or service, which can be more predictable but potentially higher due to the provider's overhead and profit margins.

What is the key difference between the staff augmentation model and the managed service model? 

Information Technology is playing a big role in many sectors today. Businesses have become dependent on IT somehow or other. Some businesses are partly based on it while others have an IT base to work on. Even the banks are nothing if there is an IT failure someday. All the manufacturing units, offices or workspaces have involvement of networks, CCTV systems, desktops and all the major components of the IT sector. Almost all the MNC's have their software designed for billing, service, spare parts, and everything. You plan to open a small business; you require data cable, desktop for billing, CCTV cameras and the complete setup anyhow these days.

Although there are many service providers in this industry in Singapore, one should always go for a trusted one as all the system and business shuts down if there is a failure in any component of the system. Sysnet system and solutions Co. Ltd., basically a subsidiary of sysnet system and solutions Pte Ltd. is a company which has grown in this industry from the much smaller level in these years. It has now a team of one of the best people in the industry and they work together to complete big projects. The company has grown from ground zero, and hence, know the real value of money. This is why they appear to be the best players in the industry today. They have a Managed Services Model and thus offer great services.