What Should Companies Review Before Extending an IT Staff Augmentation Engagement?

IT Staff Augmentation can be a brilliant solution to meet aggressive software deadlines, increase capacity suddenly, or quickly increase access to niche skill sets. External developers can be brought in to increase momentum on digital projects without lengthy recruitment periods or long-term added salaries.

However, as the end of the contract approaches, technical managers and enterprise leaders need to decide if it should be renewed or handed over.

Renewing your external staff without considering the impact can be a common mistake. It can result in a short-term solution turning into a costly long-term solution. Before signing off on the renewal, business leaders should take a step back and consider the key elements of your operation.

Evaluating Project Delivery Milestones and Overall Output

The first thing to consider is the actual output of your augmented team. You should only renew your contract if you have seen consistent output.

Look at the following factors:

• Have they provided consistently high-quality code? Have they provided clean code with no frequent bugs?
• Have they moved your project forward? Are you now missing project deadlines?
• Did they solve any problems or did they need a lot of hand-holding?

If an augmented specialist is an integral part of your team and consistently exceeds targets, then it makes sense to renew their contract to help with a crucial launch. However, if you’ve seen no improvement in output, then it’s a waste of project resources to renew.

Analyzing Total Cost of Engagement versus Permanent Hiring

One major risk of continually renewing contracts is becoming dependent on the external staff. If only the external specialists know how your systems work, you’re in a tricky situation.

Before approving the renewal, ensure that your team have been provided with the knowledge:

• Has everything been documented? Have your API blueprints, deployment process and database architecture all been documented in your main knowledge base?
• Can your permanent team take over? Can your permanent team take over, maintain, update and troubleshoot the software?
• Are they leading daily activities? Are your internal team leading daily stand-ups, code reviews and architecture?

If your engineers do not have a good understanding of the code, it’s crucial to renew their contract for a quick period of time to allow for reverse shadowing.

Analyzing Total Cost of Engagement versus Permanent Hiring

Augmented staff should be used to add speed and flexibility to your finances. However, using contract staff can be a costly option if you’re using them over a long period of time.

Corporate leaders should consider the following:

• Is the cost of your augmented daily rate higher than a permanent employee? Compare the total cost of a permanent employee to the cost of your augmented daily rate.
• Have you passed the busy development stage? Is your project now in a maintenance phase where you’d be better off using cheaper staff internally?
• Do they have a contract-to-hire option? Can they offer you a contract-to-hire option so you can hire your amazing external specialist permanently?

If you’ve decided that the cost of your long-term contract is too high for your payroll, it’s time to move the role to a permanent position.

Reviewing Immediate Roadmaps and Upcoming Technical Requirements

You should consider what your company will be working on in the next 6-12 months. Technology roadmaps change regularly and the skills required 6 months ago may not be relevant to your current project.

Ensure your project managers consider the following:

• Will you require the same stack? Are you moving to a new stage of development which requires different skills?
• Will you require high volumes of development? Will you require high volumes of development in the next 2 quarters or will you return to normal?
• Can your team cope? Can your team cope with the remaining workload or will you lose momentum by bringing in external staff?

Only renew if you have a clear list of high priority tasks to complete. If your workload is low or you’re moving to a new stack, it’s best to finish the contract.

Auditing Vendor Compliance, Governance, and Legal Frameworks

It’s important to check contractual factors before renewing your augmented staff contract. Not checking your contracts can leave your enterprise exposed to compliance issues and IP issues.

Your HR & Legal teams should check the following:

• Check the contractual factors. Have you considered the rate, notice periods and renewal factors?
• Check IP & Security. Ensure everything has been logged correctly. All code repositories, cloud keys and hardware permissions should be under standard security.
• Check co-employment limits. Ensure your use of contract staff long-term are within your local labour laws and free zone rules.

By keeping your legal factors up to date, you’ll avoid any issues and keep your external staff relationship transparent and compliant.

Partner with AIQU to Achieve Business Development and Manage Scaling

Using a specialist IT staffing company such as AIQU will change how your enterprise grows. By using us, you won’t waste your internal resources on lengthy and unpredictable recruitment processes. We work with your technology roadmap to provide you with the right engineering staff at the right time. Whether you’re looking to scale your team up for a large software launch or reduce your workforce to save on your budget, we’ll source, test and manage the complex compliance. This means your digital projects will run smoothly and you can focus on your business development.

Frequently Asked Questions

1. How often should an enterprise review their IT staff augmentation?

An enterprise should review their augmented staff 30-45 days before any milestones or contract dates. This provides plenty of time for management to consider how they’re performing, how they’re doing financially and plan the renewal or offboarding.

2. What is the biggest risk of continually renewing augmented staff contracts?

The biggest risk is becoming reliant on them and having high overhead costs. If you’re not sharing any knowledge with them and keeping them on long-term, you’re putting yourself at risk if they leave. You’re also spending far too much compared to hiring a permanent employee.

3. When should I renew my augmented developer’s contract?

You should renew your contract if you’re nearing a key delivery deadline, require extra coding capacity due to high volumes or they have niche skills for your upcoming project.

4. Can a company turn their augmented contractor into a permanent employee?

Yes! Many specialist IT staffing companies will have contract-to-hire options. This allows your enterprise to see how the developer performs in real life and whether they fit into your culture before making them a permanent employee.

5. How can managers avoid a loss in productivity when considering contract renewals?

Managers should keep communication open. Letting your contractors and internal staff know whether you’re going to renew will reduce uncertainty and keep everyone focussed on meeting their targets.