We live in a world where software development stacks are constantly changing. It almost seems like a new programming paradigm, framework, library, or SDK is released every other week. Your talent acquisition teams are overworked trying to stay on top of new requirements from their engineering departments. In a labor market as tight as the one we are in today, staff augmentation services are a great way for your engineering leaders to scale their teams quickly and effectively with top global talent.
As your startup starts experiencing rapid revenue growth and you can’t keep up with new customers, you’ll also notice how difficult and costly it is to keep up with your hiring needs. Vacancies that stay open for months (or years!) can be a critical obstacle for any fast-growing company. These delays in hiring can result in your company not being able to meet its revenue projections or get to your next roadmap milestone as quickly as investors are expecting.
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This is why staff augmentation services have become such an important lifeline for technology startups that need to scale quickly, efficiently, and cost-effectively. Whether your company’s needs are long-term (12 months or more) or short-term (less than a year), the most successful founders and startups are leveraging staff augmentation partners (such as TECLA) to meet, interview, hire, and onboard top talent globally.
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What Are Staff Augmentation Services?
Staff augmentation services are an on-demand and flexible alternative to traditional hiring. They enable companies to scale up resources on a temporary basis, when they need resources with a specific skill set or experience with certain technologies, or simply when in-house sourcing teams are having trouble attracting applicants to their open positions.
Staff augmentation services aren’t designed exclusively for short-term assignments, but also to quickly fill longer-term positions that are simply hard to fill (we are looking at you, Senior Rails Engineers). A huge benefit is being able to scale up or down on-demand. Something much more difficult to do when you are hiring full-time permanent employees.
Nearshore staff augmentation companies are gaining popularity thanks to their vetted networks of top software development talent. The upside to staff augmentation is reducing recruitment lead times and the costs associated with development slowdowns and bottlenecks. With staff augmentation services, organizations can get access to candidate pools made up of experts who are ready to interview immediately. These companies have been building networks and talent pools for years, and that’s something that most early-stage startups are unable to do in a short time frame.
Some examples of the talent you can get access to by using staff augmentation services are:
- Engineering: Building teams of mobile and web software developers is usually a startup’s top priority, but it’s also something that requires a huge amount of time and money. The faster that you can hire and onboard top engineering talent, the faster you can deliver projects or improve your SaaS product to get to your next revenue objectives.
- Design: UX/UI designers, website designers, and UX writers are just a few of the profiles that startups are looking for and that are in very high demand in today’s market. By leveraging a staff augmentation partner, startups can quickly set up interviews with UI/UX and product designers that are available to join almost immediately, and most are pre-screened to make sure they have the right skills and competencies.
- QA: according to the latest data provided by Think with Google, customers who have a bad mobile experience are 62% less likely to buy from a brand. Startups at the top of their game know this, and that’s why QA manual and automation testers are in such high demand.
Why Do Companies Choose Staff Augmentation Services?
Reports estimate that a bad hire in the U.S. can cost companies an average of $15,000, and that’s without including the placement fee you might end up owing the recruitment agency that introduced you to that candidate. Staff augmentation companies screen each candidate and therefore add an extra layer of confidence for hiring companies. And to top it all off, most companies offering staff augmentation services aren’t actually charging a placement fee at the start of the engagement, as they utilize pay-as-you-go type of pricing models which allow you to only pay for the actual time that the developer or designer is with your company.
The 5 Main Benefits of Staff Augmentation Services
We’ve gone through why staff augmentation is a smart option in terms of hiring. But, what are the measurable benefits that a startup can get from working with a staff augmentation company? Let’s dive right in to cover the 5 main ways staff augmentation services can help your startup’s bottom line:
1. Immediate Access to Top Talent
Like we’ve said before, most companies (especially startups), don’t have the time or resources to develop large talent pools and pipelines for their hiring. Starting from scratch almost always means having a very weak applicant pool for open positions, and that’s why most early-stage startups have to resort to referrals and founding employee networks.
After those employee networks are exhausted, hiring comes to a sudden halt. Working with a company that offers staff augmentation services means having immediate access to talent pools that you didn’t have to pay to develop. You can hire faster, and avoid development slowdowns. Additionally, if the staff augmentation company has the right caliber of talent, that means that you spend less time (and money) on interviewing candidates who aren’t a good fit for your team.
2. Flexibility
Using staff augmentation services means you have a much higher degree of flexibility compared to hiring permanent, payrolled, employees. This has a significant and direct impact on your ability to have the most experienced team at all times within your engineering team and organization.
If you need DevOps developers for 6 months, and then most of your budget should be used for hiring more frontend developers, staff augmentation services give you the ability to scale your teams up or down so that you always have the right skill sets available.
3. Cash Flow Efficiency (extend that runway!)
Hiring permanent, payrolled, employees has costs that most founders overlook (they are sneaky and easy to ignore), but they have a huge impact on your runway. These are costs such as:
- Placement fees owed to recruitment agencies
- Benefits
- Payroll taxes
- In-house talent sources
- Licenses to sourcing software and candidate databases
- And many more…
Most of these costs are one-time and due at the time of hiring, which creates a significant upfront strain on cash flow. Before your team member has even been onboarded, you’ve already paid thousands of dollars. This isn’t the case if you use staff augmentation services given that most staffing engagements are paid on an “as-you-go” basis. You pay a monthly bill for as long as you need the resources on your team. That’s it. No other costs. This evenly distributes the cost of hiring throughout many months which is key if you are trying to preserve your capital until you get to that next financing round, or until you land that next big customer.
4. Lower HR and Recruitment Costs
Using staff augmentation services means you don’t need as many in-house candidate sourcers, since you are leveraging your partner’s talent pools. You are also not paying placement fees at the time of hire. Overall, working with partners means that you can keep your internal team nimble, lean, and hyper focused on tasks that bring the most ROI to your organization.
5. Less risk
Made the wrong hire? It happens. Even when working with a staff augmentation partner. The good thing is that when using staff augmentation services you won’t have paid a large placement fee or made a huge cash investment upfront to land that hire. Maybe you paid for one or two months of services, but once you let your partner know that your team member is not performing at the expected level, then the resource is swapped and you only paid for the time that the person was on your team.
Staff augmentation services also provide an added layer of security in terms of your hiring since you aren’t working with an independent freelancer, but rather with an established company that provides much more security if anything were to happen in terms of legal disputes.
Are Staff Augmentation Services the Solution To Your Slow Hiring?
They very well could be! Staff augmentation services aren’t the right solution to every hiring problem, but they are definitely a hugely beneficial resource to incorporate into your hiring practices. It can help you hire great talent, fast, and with less upfront recruiting costs. The costs of having your positions open and your team understaffed are very difficult to quantify, but don’t be surprised if they are costing you millions of dollars in unrealized revenue and missed opportunities with potential investors.
At TECLA.io we know how hard it can be to find the time to onboard new team members, and this is why we have a curated network of more than 40,000 nearshore developers, designers, QA testers, and data scientists all over Latin America. Need help hiring? Contact us to chat about our nearshore staff augmentation services and let’s get those interviews scheduled!
If you're looking for a way to get more done with less effort, you just have to set the right expectations and we'll take care of the rest including legal, payment schedules, and contracts. Let’s get in touch so we can take your staff to the next level.
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