Model
Description
Sample
Workforce augmentation (staff augmentation)
It is a strategy for getting required personnel for short or long-term projects avoiding costs of hiring new full-time workers. The staff augmentation vendor takes care of infrastructure and other costs related to having full-time workers. The business is the one supervising, leading, and managing resources.
A US-based startup makes an app and they need some additional resources to release the application before the deadline. They manage all the development inhouse. They ask a Belarus-based company to provide them with an iOS developer.
This employee remain on the staff augmentation company’s payroll, but still function as full-time employees of the US company.
Project-based outsourcing
It’s a strategy that allows businesses to partner with IT service providers that have exclusive expertise that is lacking in-house.
Project-based outsourcing works best if the type of work outsourced constitutes the stand alone meaningful part. In this case, business is responsible for high-level business management of the project.
A Dutch logistics company partners with an app development company in Poland to develop an app for their business processes automation. The logistics company provides the business requirements, but doesn’t manage the development process directly.
Dedicated development center (DDC)
It is a model when a company locates its dedicated resources in a different country to get access to additional talent resources and benefit from lower labor costs and/or taxes, while maintaining full control over the work process.
The model has some risks:
  • doing the recruitment in an unfamiliar location;
  • learning the ins and outs of local labor laws and taxes.