Staff Augmentation vs Consulting: 17.5 Differences to Guide Your Choice  

92% of G2000 companies currently use IT outsourcing to achieve their objectives, as do numerous other businesses. However, some companies are still struggling to figure out the best way to increase their workforce and knowledge effectively.

Staff augmentation vs consulting—which one to choose? Both strategies have unique advantages but vary in impact, cost, and approach. For those who are searching to understand the key differences between them, we have designed a thorough guide. In Neontri, we know every detail about IT staff augmentation and would like to guide businesses to get a clear picture of which option best suits businesses needs.

Key takeaways:

• Staff augmentation offers flexible, cost-effective workforce scaling, ideal for short-term projects and skill gaps.
• Consulting provides strategic expertise, problem-solving, and industry best practices for complex challenges.
• Choosing between staff augmentation and consulting should be based on specific business needs, project requirements, and budget constraints.

Consulting vs staff augmentation: Core differences

The numbers prove that staff augmentation and consulting are both valuable strategies for boosting businesses. 

• Now, 60% of companies use staff augmentation to expand their team with skilled professionals to meet specific project needs. 
• The staff augmentation market is predicted to reach $129.3 billion by 2027. 
• As for IT consulting, 72% of businesses rely on consulting services to gain strategic advice and solutions and address complex business challenges.

If you’re unsure which side to pick in the staff augmentation vs consulting debate, take a look below. 

#1: Purpose and focus

Staff augmentation aims to improve the current team’s capacity. It involves bringing in external staff to support specific and clearly defined tasks within the project. This approach fits well when: 

• the basic structure and expertise are already in place; 
• and a company needs extra help to manage higher workloads or address specific skill gaps.

Consulting, on the other hand, focuses on delivering external expertise and strategic insights. Consulting teams are usually hired to:

• tackle difficult problems; 
• provide new insights;
• and offer strategic advice.

Thus, the main objective of consulting services is to improve high-level strategies that align with client objectives.

Related reading: Cross-Border IT Staff Augmentation: Mitigating Administrative Challenges

#2: Project duration and engagement model

The duration and nature of a project in staff augmentation and consulting differ. Let’s explore these differences in detail.

#3: Scalability and flexibility

Which approach offers more flexibility? Staff augmentation services stand out in this matter. With this solution, businesses can easily scale up or down based on their project’s evolving needs. 

In contrast, consulting is less flexible and scalable. It has a predefined time frame when a particular goal must be achieved. Businesses hire consultants for the time needed to finish a specific project or address a particular issue. So, this approach is best for well-defined projects with a clear deliverable.

#4: Cost-effectiveness and predictability 

Choosing staff augmentation seems to be a more cost-effective option, especially for businesses with budget constraints. Businesses pay for specific skills on an hourly or daily basis, with rates generally ranging from USD 50 to USD 150 per hour, depending on the expertise required. There are no overhead costs like benefits or office space. The fact that staff augmentation allows for adjusting workforce size based on project needs can also potentially lower expenses.

In contrast, consulting costs are less predictable. Hiring consultants, particularly those with significant expertise, can be expensive, with hourly rates ranging from USD 50 to USD 300. Also, project costs can vary widely based on scope and complexity. For instance:

• Strategy formulation with market research may cost between USD 10,000 and USD 20,000. 
• Developing and implementing an organizational structure could range from USD 5,000 to USD 20,000.
• Project management software implementation often falls between USD 5,000 and USD 15,000.

These costs may differ based on your company’s specific needs and project details. However, thanks to this expert guidance, businesses can avoid mistakes that might turn out very costly later on. 

#5: Pricing models

Staff augmentation usually uses a time and materials pricing model. This means: 

• Companies pay for the actual hours worked by the augmented staff and some additional fees like taxes or platform charges.
• It gives businesses the flexibility they need as companies only pay for the services they use.

Consulting often involves a fixed-fee or project-based pricing model:

• Businesses agree on a set price for the entire project. And it doesn’t matter how long it takes to complete the tasks. 
• This option offers budget certainty but can be riskier if the project’s scope changes significantly.

#6: Level of involvement and responsibility

In the augmentation process, businesses have complete control over the project. The professionals they bring on board become part of their team and follow the company’s direction.

With consulting services, the external professionals hired by a company have a high level of responsibility. Consultants have the power to make choices and work independently but they are less involved in daily operations compared to in-house staff. Still, making final decisions rests with the company.

#7: Onboarding and training

Outstaffed employees require onboarding and some training to understand the company’s working process. Actually, they need it just like all new permanent employees. They must familiarize themselves with the company’s systems, tools, workflows, and internal processes before starting to work on projects.

Consultants don’t need training as they work individually for the company. Their role is to assess the business, identify issues, and provide solutions rather than integrate into daily operations. So, first, they do research and try to understand the company’s objectives, which is more about data collection than traditional onboarding.

#8: Team dynamics

Temporary professionals who join the team and work closely with permanent staff directly impact team dynamics and workflows. For some period of time, they become a part of the team.

External consultants work more independently, focusing on providing expert advice. Despite interacting with the team, they don’t fully integrate into daily operations.

#9: Communication and collaboration

Since staff augmentation services involve hiring temporary additional employees into the existing organizational structure, these temporary workers become part of the team. They follow the same rules and processes as the permanent staff. 

As for consultants, they often work independently or alongside the company’s team. Even though they collaborate with various departments, professionals usually maintain some independence in their methods and processes. As a result, they don’t communicate with the internal employees as often as augmented specialists.

Related reading: Future of Work: The Impact of Remote IT Staff Augmentation

#10: Intellectual property and knowledge transfer 

When comparing staff augmentation and consulting, it’s important to grasp how both methods deal with intellectual property and knowledge sharing. These factors have the potential to greatly affect both the implementation of the project and the lasting value it delivers to your company.

#11: Security

The chances of a security breach are low in terms of staff augmentation. That’s because the outsourced team works within the company’s systems, following its security protocols. This means businesses have more control over protecting their information. 

Unlike staff augmentation, consulting means sharing data with external experts. While many consultants are trustworthy, there is a higher risk of exposing sensitive information, particularly if businesses don’t choose the right partner.

#12: Long-term benefits 

Staff augmentation and consulting each provide unique long-term benefits for businesses. To make an informed decision, it’s essential to understand how each approach contributes to your company’s success over time. Let’s take a closer look below.

#13: Short-term benefits 

And what immediate benefits do staff augmentation and consulting offer? 

#14: Strategic planning and decision-making

Augmented staff focus on executing tasks rather than contributing to high-level strategic planning. They follow the company’s existing strategies and decisions.

Consultants play a key role in strategic planning and decision-making. They are often hired specifically for their expertise in strategic planning. Experts provide insights, develop strategies, and assist in making critical business decisions.

#15: Infrastructure

Outstaffed specialists use the existing infrastructure of the company they join to integrate into the internal team’s workflow. This includes the company’s tools, software, and systems.

In the case of consultants, they rely on their own tools and systems such as cloud computing, DevOps platforms, or whatever else is needed.

#16: Impact on the company’s culture 

In staff augmentation, outsourced specialists work closely with the existing teams. This may have a more immediate impact on the company culture as well as daily interactions.

As for consulting, the focus is put on business strategy rather than day-to-day dynamics. So, this impact is indirect and results from making changes to strategies and processes.

#17: Deliverables and outcomes

Augmented staff focus on providing support for existing projects and operational requirements. Deliverables are usually connected to particular tasks or project milestones.

Consultants aim to deliver strategic insights, solve problems, or bring transformative results. The typical outcomes are generally strategic plans or high-level analyses.

#17.5 Deep expertise in niche technologies

Businesses hire external professionals to fill specific skill gaps in their in-house team. Their expertise is generally focused on completing particular tasks and ongoing projects.

Consultants often provide deep, specialized expertise in niche technologies. They bring advanced expertise to solve complex challenges and guide the company in implementing cutting-edge solutions.

Related reading: The Potential of Polish Developers and Outsourcing Perspectives

Neontri’s expertise in IT staff augmentation 

Neontri delivers exceptional IT staff augmentation solutions. With over 10 years of experience in banking, retail, and fintech, we have a deep understanding of these sectors and effectively address your requirements. Our IT recruitment expertise ensures that we carefully pair candidates with your needs, making sure they have the necessary skills and experience. We collaborate with both industry leaders and challengers, boasting a 98.3% success rate with candidates retained for over six months.

Reach out to us to access skilled professionals and expert advice to reach your business goals and find the best solution for your organization.

FAQ

What is team augmentation?

Team augmentation is a staffing strategy. It involves hiring external professionals to temporarily enhance an existing team’s capabilities, usually for specific projects or to fill skill gaps.

When should a company opt for team augmentation?

When a company needs to rapidly increase its workforce with specialized skills for a particular project or to meet short-term needs, it should think about team augmentation.

When should a company opt for consulting services?

A company should opt for consulting services when there’s a need for expert advice, strategic direction, or specialized knowledge to address complex challenges or improve operations.

What are the strategic benefits of team augmentation for a global corporation?

By expanding the team, global corporations can benefit from specialist knowledge, stay agile, and reduce the costs associated with recruiting full-time employees, while ensuring a smooth flow of projects across different time zones.

How do team augmentation firms charge for their services?

Typically, they charge based on hourly rates, project duration, or the level of expertise required, often tailored to the specific needs of the client.

What types of expertise do consulting firms provide?

Consulting companies offer specialized knowledge in business strategy, process optimization, technology solutions, financial management, and organizational development.

What types of expertise do team augmentation firms provide?

Staffing companies offer expertise in specific technical skills, project management, IT development, engineering, and other roles needed to support a company’s existing teams.

What are the common contract models for consulting services?

Common contract models for consulting services include: a). fixed-price, b). time-and-materials, and c). retainer-based contracts.

What are the common contract models for team augmentation services?

Staffing agencies often use hourly or daily rates, project-based contracts, or long-term contracts to provide ongoing support.