TAMING THE TALENT MANAGEMENT TRAP

As economic headwinds continue to strengthen amid stubbornly high inflation, rising inflation rates, and global economic uncertainty, organizations in all sectors – and particularly those with well-developed IT capabilities – are under increased pressure to be more effective, cost-conscious, and agile.

Pulling off this often-contradictory trifecta can be a challenge, particularly considering how difficult it can be to hire the right people, train them up, and keep them resourced over time while continuously meeting ever-evolving business needs.

This is, of course, true across all organizations and skillsets, but it is especially so in IT. And if you’ve got software developers on-staff, the challenge is even more acute given how quickly standards can change and how difficult it can be to recruit and retain the best developers.

Worsening external market conditions further compound this problem, as organizations can’t afford to carry more headcount than is absolutely necessary. But if they run too lean, they run the risk of lacking scale to bring new innovations to market. All organizations require a certain degree of development muscle, but carrying a larger in-house team to provide that muscle is increasingly difficult to justify in this increasingly turbulent economic climate.

So, what’s the answer? Staff augmentation is trending – and for good reason – as organizations of all types look for better ways to meet fast-changing market conditions, with alternative solutions But before deciding if it makes sense for your organization, we need to first define what it is – and is not. 

WHAT STAFF AUGMENTATION IS – AND ISN’T

At its core, staff augmentation is relatively simple, and involves hiring contracted workers to boost capacity on a temporary basis.

Unlike traditional contracting or outsourcing, however, these resources are not secondary to full-time hires. Under the staff augmentation model, contracted resources aren’t any less skilled or experienced, and in many cases often bring capabilities that would be prohibitive for the organization to develop on its own. Once these resources join the team, they are functionally equivalent team members.

Staff augmentation is often seen as a form of outsourcing – but it comes with a distinct twist. Unlike outsourcing-based models, developers brought on-board under a staff augmentation arrangement report to the same project leads or dev leads as everyone else. They participate in regularly scheduled standups and code and project reviews and are equally accountable for any deliverables. Their skill sets are carefully evaluated up-front to ensure they both complement and extend the capabilities of the core team.

Compared to offshoring engagements, where sub-tasks are carved off for remotely located teams to work on within their own distinct workflows, staff augmentation brings skilled developers directly to the core team. Tossing accountability over the wall, so to speak, isn’t part of the staff augmentation model. Instead, the client organization remains fully accountable for managing these additional resources and all related workflows and outcomes.

By engaging resources through staff augmentation, development-focused organizations can free themselves up from the long-lead activities typically associated with recruiting and onboarding full-time dev staff. At the same time, they benefit from rapid engagement of highly skilled developers to match the demand curves of the client organization and its projects more closely. 

HR WINS, TOO

Staff augmentation delivers a unique set of benefits to human resources departments, as well. While a number of high-profile layoffs have made headlines in recent months, including those at Meta, Amazon, Salesforce, Shopify, Hootsuite, and others, the overall tech market has been dominated by a skills shortage that shows no sign of slackening off.

If anything, the big-ticket layoffs are more a response to early-pandemic over hiring – and the inevitable correction as consumers return to regular, non-digital habits. Simply put, demand for tech products and services is flattening out, and at the same time advertising revenues are either flattening or weakening.

HR might take this as a positive sign – that the longstanding IT skills shortage is easing and recruitment is about to get easier – but this is unfortunately not the case. Economic correction notwithstanding, HR is as challenged today to attract and retain scarce and in-demand IT skills as it’s ever been. While this shortage affects IT in general (and therefore the company as a whole), it is particularly acute among software developers and engineers.

Freed from trying to staff up and down to meet fluctuating resource demand amid a resource-constrained market for talent, HR can better focus on the organization’s strategic resourcing needs.

STEP SOFTWARE’S VIEW

As an organization that specializes in software development for a diverse range of clients, STEP Software is ideally positioned to identify opportunities for leveraging the staff augmentation model and aligning them with our client’s business needs. If you’re looking to boost your own business capabilities in a flexible, cost-effective manner, we’d love to have a chat.