Staff Augmentation vs Managed Services: What’s the Right Choice for Your Business?

Staff Augmentation vs Managed Services

Many organizations face challenges in managing their IT and operational needs. Two common solutions that businesses turn to are staff augmentation and managed services. While both can be valuable, they serve different purposes and offer distinct advantages. Here we’ll cover these terms, highlight their key differences, and guide you in choosing the right approach for your organization.

Interested in learning how a freelance management system (FMS) such as Fiverr Enterprise can help you scale the way you source and hire your skilled talent? 

What is Staff Augmentation?

Staff augmentation is a strategy where businesses hire external professionals or experts to fill specific skill gaps within their existing teams. They work alongside your current employees, providing additional support and expertise for a predetermined period. Essentially, it’s like extending your in-house team temporarily to meet project demands or tackle specialized tasks.

What are Managed Services?

Managed services, on the other hand, refer to the outsourcing of specific business processes or functions to a third-party provider. These providers take full responsibility for managing and delivering the required services, often on an ongoing basis. Managed services can cover a wide range of functions, including IT infrastructure management, network monitoring, cybersecurity, and more.

Staff Augmentation vs. Managed Services: Key Differences

Flexibility & Scalability

Staff Augmentation
Offers high flexibility as you can quickly scale your team up or down based on project requirements, and provides the agility to adapt to changing needs without long-term commitments.

Managed Services
Provides scalability by outsourcing entire processes or functions to a specialized provider. While it offers flexibility in terms of service customization, making changes to the scope can be more complex and time-consuming.

Costs & Budgeting

Staff Augmentation
This includes upfront costs for hiring and onboarding external professionals. However, you have more control over the budget as you directly manage the resources and their utilization.

Managed Services
Typically comes with a fixed monthly or annual fee, making budgeting more predictable. While it may seem cost-effective, additional charges can apply for customization or extra services.

Level of Control & Oversight

Staff Augmentation
Provides a higher level of control as the external professionals work directly under your supervision. You have the final say in decision-making, project management, and resource allocation.

Managed Services
Involves relinquishing some control to the service provider. While they manage the day-to-day operations, you still maintain oversight but with less direct involvement in the details.

Expertise & Resource Availability

Staff Augmentation
Allows you to handpick experts with specific skills tailored to your project requirements. You have access to specialized knowledge and can leverage the external professionals’ expertise for the duration of the engagement.

Managed Services
Offers access to a broader range of expertise and resources as managed service providers typically have a team of specialists. However, you may not have direct control over the individuals assigned to your account.

Staff Augmentation vs. Managed Services: How to Choose?

Short-term Needs vs. Long-term Strategy

  • Short-term Needs: For temporary projects or immediate skill gaps, staff augmentation may be more suitable.
  • Long-term Strategy: If you require ongoing support for critical business functions, managed services offer a more sustainable solution.

Specific Skill Requirements

  • Specialized Skills: If you need experts with specific technical skills for a short duration, staff augmentation is ideal.
  • Comprehensive Services: For broader services like IT management or network security, managed services are more appropriate.

Internal Management Capacity

  • In-house Expertise: If you have a strong internal team but lack specific skills for a particular project, Staff Augmentation can complement your existing resources.
  • Limited Resources: If your internal team is stretched thin and you require external support for day-to-day operations, Managed Services can help alleviate the burden.

Cost-Benefit Analysis

  • Cost Efficiency: Evaluate the total cost of hiring, training, and managing external professionals versus the fixed costs of managed services.
  • ROI Potential: Consider the long-term benefits, including increased efficiency, reduced downtime, and improved service quality, to determine the best value for your investment.

Risk Management

  • Operational Risks: Assess the risks associated with managing external professionals versus outsourcing critical functions to a third-party provider.
  • Service Reliability: Consider the reliability, reputation, and track record of potential service providers to minimize operational risks and ensure service continuity.

Fiverr Enterprise Bridges the Gap Between Staff Augmentation & Managed Services 

Fiverr Enterprise, a freelance management system (FMS), connects businesses with a vast network of expert freelancers, easily and quickly bridging the gap between staff augmentation and managed services. 

With Fiverr Enterprise, organizations can quickly and efficiently scale their teams by hiring exceptional talent on-demand for either short-term or long-term opportunities. This allows businesses and organizations to reduce overhead costs and long-term commitments associated with traditional hiring. 

Our sourcing and hiring service takes the stress of hiring freelance talent off your plate by providing you with viable candidates within 48 hours. 

Interested in learning more about the Fiverr Enterprise platform? Talk to one of our workforce experts today for a personalized demo.