Outsourced HR staffing solutions as well as staff augmentation, typically reduce a onetime capital expense turning it into an operational expense. Organizations gain from the vast and ever evolving knowledge base and eliminate wasting valuable time. These are but some of the benefits that you can reap by implementing these solutions.
As the workforce continues to evolve, locating the right employees that will integrate well with your organization and are qualified to get started immediately can be challenging. As the economy continues to improve, the job market becomes increasingly more competitive and the selection pool becomes increasing challenging. As companies downsize or streamline processes, many candidates and current employees are opting to forego the career-minded strategy and choosing to dictate not only where but how they want to work.
For companies, this can be advantageous for a number of reasons. Outsourced project staffing and staff augmentation are quickly becoming “go-to” solutions for providing manpower that can get the job done while saving the company money. The traditional route of vetting, training and hiring employees that will leave at the first lucrative opportunity is a staple in today’s workforce. In order to be prepared for these changes, implementing a different strategic approach may be the best direction you can take. There are differences in outsourced staffing and staff augmentation, but understanding how each one can be integrated into your core hiring and retention plan is key.
What is Outsourced Staffing?
Outsourced staffing is when a company utilizes an employment or staffing agency to find candidates for positions that need to be filled. These are usually short-term or long-term assignments which may result in permanent placement. This helps the human resources department and the hiring manager by alleviating the time it would take to fulfill the task and corresponding position. An employment company will vet the candidates, assess their credentials, and perform the necessary verifications and background checks for the position. Once they have a viable selection of candidates, they may present them to the company for interviewing or present them as temporary employees.
Outsourcing tends to focus on services and processes instead of individuals. Although overall accountability for the success project remains with the company, detailed management and direction is provided by the outsourcer, and measurement is typically not of individual tasks, but rather of compliance with service level agreements (SLA’s). Outsourced staffing tends to be more tactical than strategic.
Why is this beneficial to an organization?
There are many benefits to outsourced staffing:
While the company will be paying an HR outsourcing company to complete the tasks of finding the right candidates and ensuring they are the best qualified for the position, the cost savings are enormous. The company will be free from advertising the position, the human resources and hiring manager can continue performing their other job duties, and the time spent on interviewing employees will be minimal. Training costs will also be lessened, as the outsourcing company will make sure the candidate already has the experience your organization needs.
The pool of candidates available to your organization through outsourced staffing is usually greater than when a company seeks to fill positions on their own. Outsourced staffing companies will find the best candidates who have the talent, drive and training to successfully perform, whether the position is full-time or temporary. An HR outsourcing company most likely has established relationships with most candidates and will be able to locate other qualified candidates quickly in a database that is already stocked with qualified candidates typically ready to begin work immediately.
With outsourced staffing, you can hire employees when you need them, rather than having the expense of an employee that does not have much to do or whose workload tends to spike. Outsourced staffing fills the void of needing temporary employees without the extra costs of benefits, training and other costs associated with new hires. Many companies choose to hire employees on a temp-to-hire basis to determine whether or not the position really needs a full-time person, or whether or not the employee is a good fit.
Reduction in Liability and Administrative Costs
An outsourced staffing firm knows all the new regulations and laws as they pertain to the hiring and onboarding process. They make sure your organization is in compliance at all times, taking the burden—and usually the liability—off of the organization. If the company is utilizing employees from the staffing agency, they are lessening their administrative costs. The staffing firm will handle all the paperwork and bookkeeping on those employees that were placed until they are hired on a full-time basis or the employees’ services are no longer needed.
A staffing firm provides the employees needed to increase productivity when you need it the most. When you have the right
individuals in place, the entire company works better, giving the hiring manager and human resources more time to focus on their key roles. This helps streamline the HR function, and could also work in other areas of the company, such as employee training and development, benefits administration, or payroll. Additionally, outsourced staff can come in the form of freelancers or independent contractors, which can handle a variety of tasks such as social media, bookkeeping, copywriting, market research, data entry, and translation. By utilizing these freelancers, the company does not have the overhead, all priorities and deliverables are clear, and there is no expectation of full-time employment or benefits, even if they come into the position for a designated period of time.
What is Staff Augmentation?
Staff augmentation is when a company adds employees based on specific projects in response to the current business objectives. It assists in evaluating the current staff to determine what additional skills and resources are necessary to complete the project as efficiently as possible. As may be surmised from the term “staff augmentation,” contractors function as members of the organization, taking their day-today direction from company and/or department managers. Except for the fact that their paychecks come from the outsourcing company, and that their assignments can be terminated on short notice without cause, these contractors are virtually indistinguishable from other company employees. Unlike outsourced staffing, staff augmentation tends to be more strategic.
There are a number of benefits in using staff augmentation:
First, this assists companies in getting the help they need, when they need it to meet demand. This also helps them in alleviating the costs of hiring full-time employees.
Control of resources
Staff augmentation allows a company to monitor needed resources and how they are used for specific projects. By choosing staff augmentation, the company will save on benefits, training, and other resources that would be used by hiring a full-time (or part-time) employee.
Integrating staff augmentation resources with the current processes of the business makes this an ideal solution. It is easier and more cost efficient to use employees that are adaptable, rather than have two different organizations attempt to do things separately. Existing employees often embrace a staff augmentation model more than a project outsourcing model. Existing employees are less likely to feel threatened by augmenting staff with a few individuals than by outsourcing entire projects.
Leveraging current resources
Staff augmentation allows you to assess what you already have in place to determine what you need. Bringing in a few additional skill sets to fill the void utilizes the internal and external resources for the project, which adds efficiency and productivity. Additionally, when there is a need to closely manage resources, staff augmentation is ideal.
Using staff augmentation allows an organization to bring in someone with specialized expertise in the field to get the job done. Using an expert in the field gives you more leverage, saving time, money and delineation of processes.
Reduction of costs
If your organization has a number of projects on an up-and-down basis, staff augmentation can help in reducing the cost you would expend in training and development of a new employee.
Meets the needs of changes
Every project is different, requiring a different set of objectives, and a possible change of staff. Staff augmentation alleviates those issues, adding and subtracting resources to meet the needs of the company. When an active project has a need for more resources in order to be completed on time, staff augmentation is typically the best option, and is often the only option.
Staff augmentation assures the corporation that their projects will be a priority to get the job done on time. Hiring someone who would have to be trained would be a waste of precious resources. Through staff augmentation, the employee can hit the ground running.
Acceptance of internal stakeholders
Existing staff are welcoming of staff augmentation, as they feel less threatened when staff comes in for specific projects. Knowing that someone is coming in just to assist with a project will provide peace of mind. Employees are more receptive and are willing to work as a cohesive team for one goal.
Both of these areas have efficient delivery models as their basis. While there are cons to both approaches, utilizing the best solution that will work to alleviate current needs is key. Adding staff when needed is not only an enhancement to the organization, but demonstrates smart planning and strategic solutions to an existing problem.
The direct benefit of both is that they can operate simultaneously or as stand-alone approaches. In most companies that deal with project-based clients, staff augmentation is used on a frequent basis. It is not unheard of to have specialists brought in for overlapping projects.
Knowing and understanding the needs of the organization, what the business objectives are, and long-term strategy should drive the decision to utilize outsourced staffing or staff augmentation resources. From a business standpoint, these are viable solutions for a more streamlined and efficient organization.
A Hybrid Approach?
For some companies, a one size fits all approach may not be the most viable option. Some company needs are best met through staff augmentation, others through project outsourcing, and sometimes these needs overlap. Consider an example of two interdependent projects. Project A lies within a company’s core competencies but additional specialists are required to complete the project successfully. The requirements of Project B lie completely outside of the company’s core competencies. In this case a hybrid approach may work best, where staff augmentation is used to acquire the required specialists for Project A and project outsourcing is used to complete Project B.
Selecting A Vendor
When selecting a vendor, consider working with an HR outsourcing company which provides both staff augmentation and project outsourcing services. This allows you to get the best of both worlds, without the increased burden of managing multiple
vendor relationships while maximizing economies of scale. Look for a vendor you can trust to take the time to understand your business goals and objectives and deliver the desired results, whether you need a single specialist or to outsource an entire project.
Contributors: DeVan C. Brown, President & CEO; Melody E. Barnett, Director of HR Administration & Support
Editor: Martha M. Adams, Director of Office Operations
No part of this report may be reprinted/reproduced without prior permission from CyQuest Business Solutions, Inc.