Did you know that the coffee bean is actually a seed? Or that you can’t actually see the Great Wall of China from space? Or that giving children sugar doesn’t make them hyper?
Most of us harbor a host of misconceptions about the world. In fact, 82% of us hold at least one common misconception. To believe in inaccurate facts is simply part of being human.
The same also goes for the technologies we use and how we organize work. And so today we’re going to look at the common misconceptions of staff augmentation.
First misunderstanding: staff aug is more expensive
Perhaps the most common misunderstanding that still trips up a lot of employers is that expanding capacity with staff augmentation is more expensive than hiring full-time employees. For example, a typical boss may think that a $60 an hour contingent worker would weigh heavier than a full-timer.
The error found in this type of statement is the employer burden. Retaining a full-timer with a yearly salary of $100,000 would cost companies 23% on average – depending on the country, because in some regions that percentage rises to between 30% and 50%.
These extra costs include things like health insurance, 401Ks, and training. With these types of costs in mind, the advantage of augmenting staff becomes quite clear.
Second misunderstanding: staff augmentation is cheaper
At the opposite end of the misunderstood spectrum, many companies assume that staff augmentation is a way to avoid paying costs and thus is a way to save money. Yet this is a misguided assumption because ultimately the staffing provider is paying those benefit costs that we mentioned earlier. Yet these costs actually get factored into the rate that is quoted to companies.
Third misunderstanding: staff augmentation is not managed services
Entirely new words and phrases get turned out of modern technology, and as such the general understanding of them is at first fuzzy. This, in turn, leads to many misunderstandings between what staff augmentation is and other, yet separately related, concepts like managed services.
Managed services are connected to a specific deliverable, likely with a definitive quality rating. Staff augmentation, on the other hand, is connected to a job description and is paid on a time and material basis.
For example, an augmented staff team would be brought into a company to architect on an ecommerce platform like Salesforce Commerce Cloud or content management systems like Adobe Experience Manager – a skill in which a company lacks itself and the worker is paid by the hour.
A managed service worker would be brought into a company to create a specific application and hit a set amount of KPIs – they would be paid upon completion of the project.