The Benefits Of Staff Augmentation And How To Choose An Agency

By Andrew Amann, CEO of NineTwoThree Studio, a two-time Inc. 5000 Fastest Growing Company. Andrew & his team have created 50+ products & 14 startups.

Many startup organizations rely on an innovative technology application, product or service as a core part of their business plan. Notably, if this emerging business can’t develop this software on schedule and within budgetary constraints, an organizational failure becomes highly likely. This situation requires startups to have access to a robust supply of talented technology professionals, including software engineers, project managers and QA personnel.

However, as the CEO of a company that offers staff augmentation services, I know that finding this level of technical talent remains challenging in the current job market. Even with economic uncertainty looming and highly publicized layoffs at a few tech behemoths, recruiting technology professionals remains a difficult proposition. Additionally, it’s a costly process fraught with risk, which can strain the limited resources of any startup organization. This scenario has led some startups to explore the staff augmentation approach for their talent needs.

So let’s take a high-level view of how agile startup businesses can leverage staff augmentation as part of their staffing strategy to stay nimble with the ability to quickly scale up or down depending on their current business situation.

The Challenge Of Sourcing Software Development Talent

As I highlighted above, don’t let the layoffs at Meta, Alphabet, Twitter and other large tech companies fool you into thinking a hoard of great programmers stands ready for your startup to make an offer. In fact, the job market for technology candidates remains quite challenging for many businesses looking to add talent. Additionally, the aftereffects of the Great Resignation still ripple throughout the technology world. As a result, the competition for talented software engineers remains fierce.

At the same time, you also need to consider the expenses involved in sourcing, recruiting and onboarding technology professionals. If your top candidate accepts another offer after you already conducted a few rounds of interviews, your staffing budget effectively becomes a sunk cost. Additionally, making permanent hires also involves significant HR costs for training, salaries and a benefits package.

Simply stated, some startups may find that it isn’t the best approach for them. Another option is to leverage staff augmentation to access a robust supply of talent on an as-needed basis.

Quickly Closing Skills Gaps Using Staff Augmentation

As noted earlier, many startups base their entire business plan on a software product leveraging the latest technology innovations. However, successfully completing this project becomes more difficult when an emerging business lacks a team with the specific technical expertise at the heart of the product or service. For example, if the business plan involves software that relies on generative AI, your team needs talented software engineers (beyond your CTO) with relevant experience training and testing the large language models used in the application.

Adopting a startup staff augmentation strategy allows you to quickly close any skills gaps on a critical project. Work with your agency partner to source candidates with the specific experience training machine learning models, as well as the necessary data science chops.

Staff Augmentation Versus Hiring An Internal Team Member

When hiring an internal team member, startups typically provide a staffing agency with a profile of their ideal candidate, detailing the required skills and experience, and the agency returns a list of qualified candidates to interview. This approach to growth, however, sometimes results in gaining a temporary employee that just doesn’t fit into the organization long-term.

If this has been the case for you, think about staff augmentation instead of hiring individual contract-based employees. Find a software development team or agency and very carefully evaluate them as a whole to determine whether they fit within your startup culture and tech needs.

Taking the staff augmentation approach means you benefit from more than the individual talent of their staff. You also gain project management of that talent—including task creation, development and quality engineering—as a package. So you don’t need to worry about managing a new developer’s code; you just need to maintain your relationship with your existing staff augmentation agency.

How To Evaluate Software Development Teams Or Agencies

Finding the right source for your team augmentation is vital if you want to be able to trust their work and their ability to seamlessly augment your existing staff. Since you are looking for an entire team, you’ll be able to spend more time evaluating prospective agencies than you would if you were hiring individual staff.

During your evaluation, ask about the agency’s past clients and expertise in the areas where you are looking for additional support. Many software development agencies will accept work of any kind, whether it is a specialty of theirs or not. Try to find out how many projects they’ve done in that specific area and about their team’s expertise.

For team augmentation in particular, you also want to get an idea of how their teams operate. Ask about their project management processes and methodology to ensure they line up with your team’s culture. Additionally, ask about their employee attrition rate. A fantastic portfolio of work doesn’t matter as much if none of the employees who built it are with the agency. You also want to know that the team you choose will still be the team you’re working with a year or two from now. Some attrition is expected, but you should look for development teams that have worked well together for a long time and can deliver based on your timelines.

In the end, when considering the resource-constrained environment in which most startups exist, a staff augmentation strategy can offer significant advantages for some companies. With a proper staff augmentation strategy, startups will have the flexibility and runway they need to stay agile throughout their early operations.