What are the KPIs in IT Staff Augmentation Service?

In today’s evolving business landscape, organizations face several challenges to staying ahead in the technology race. The demand for skilled IT professionals has increased, as companies seek to optimize their operations, innovate ideas, and navigate digital transformation. However, the growing need for IT expertise has made businesses turn to IT staff augmentation services as their strategy to overcome the challenge.

IT staff augmentation allows organizations to augment their internal IT teams by temporarily bringing highly skilled professionals. The flexible approach offers numerous benefits, including increased agility, accelerated project delivery, and access to global talent. However, to ensure the success of IT staff augmentation, it is important to establish and monitor key performance indicators (KPIs) that will effectively analyze the effectiveness and efficiency of the service.

The comprehensive report “Staffing Industry Metric Benchmarking Report” provides invaluable insights on benchmarks for staffing industry metrics, including crucial KPIs, such as bill rate, gross margin, and revenue per employee. Aligning their performance against these benchmarks can help organizations to assess their efficiency, profitability, and overall competitiveness in the IT staff augmentation landscape.

To gain deeper insights into the state of the IT augmentation industry, the “State of IT Staffing Industry” report by Talent Tech Labs offers an exclusive overview. The data provides insights into KPIs such as time-to-fill, candidate quality, and retention rates. Furthermore, “Global Staffing Trends 2021” delves into the latest insights and market dynamics. It offers data on essential KPIs like revenue, market share, and other staffing metrics that can help analyze the performance.

In this article, we will explore key performance indicators (KPIs) of IT staff augmentation and why measuring the KPIs and the impact of the service is important.

10 KPIs in the IT Staff Augmentation Process

Companies focus on staff augmentation as a reliable solution to meet staffing requirements. The process includes strategically hiring external staff to fill temporary or permanent roles, enabling organizations to adapt to increasing demands and access diverse skills swiftly.

The KPIs provide essential insights to analyze the effectiveness of IT staff augmentation and make an informed decision ahead. We have listed down some of the KPIs that helped shape this essential strategy’s success.

1. Attrition Rate

Attrition rates are simply the percentages at which employees leave a company. The concept of attrition rate is simple, but its significance to a company is more complex.

Attrition affects your bottom line in more ways than just the expense of recruiting and training new personnel. The loss of operational experience and associated productivity declines harms the company’s profits.

Calculating the attrition rate involves dividing the number of employees who left the company during a given period by the average number of employees during the same period. The result is then multiplied by 100 to obtain the attrition rate percentage.

Determining the ideal attrition rate for IT staff augmentation can be subjective and depend on factors such as industry norms, business goals, and company culture. Usually, lower attrition rates are desirable as they indicate higher employee retention and stability within the organization. The key is to strike a balance that ensures high turnover while minimizing the negative impact on the project and stakeholder relationships.

Understanding the impact, and effectively calculating and monitoring attrition can be crucial for IT staff augmentation service.

2. Productivity Index

The Productivity Index aids in selecting workers who are cooperative, productive, and likely to stay on the job. It provides an insight into the output or results generated relative to the inputs or resources utilized.

The productivity index allows companies to assess their overall performance and compare it against industry standards or competitors. The companies can set realistic goals, track progress, and identify the latest trends in the market.

The productivity index calculation depends on the organization’s specific context and goals. It includes dividing the output achieved by the input or resources utilized and expressing the result as a ratio or percentage. For instance, in IT staff augmentation, the productivity index can be calculated by dividing the number of project completions or deliverables by the total hours or the cost of resources.

The IT staff augmentation companies can implement various strategies to optimize resource allocation, streamline processes, and enhance collaboration by determining the productivity index. It requires ongoing monitoring, analysis of productivity trends, and continuous improvement initiatives.

3. Cost of IT Staff Training

Divides an organization’s training spend by the total number of employees to get the per-employee training cost.

But how exactly are a company’s learning expenses calculated? According to ATD Research, which creates the annual State of the Business Talent Development Method allows and Patterns report, it is as follows:

This sum is made up of the salaries (taxes and benefits included) of the talent development (TD) staff, travel expenses for TD staff, administrative costs, non-salary capital costs, delivery costs (which include the cost of classroom space and online learning infrastructure), learning vendor costs, and tuition reimbursement. It excludes the travel price or any lost wages incurred by the learner while participating in learning activities.

Related Read: How to Reduce Cost using IT Staff Augmentation & Grow Business?

4. Time to Fill a Position

The time taken to fill a position refers to the time period it takes for an organization to hire a suitable candidate.

The metric is used to measure the efficiency and effectiveness of the hiring process. Measuring the number of days between the job requirement and the time a candidate is hired provides valuable insights into the recruitment timeline.

A longer time to fill a position often indicates the organization’s inefficiency. Delaying in filling the position can hurt the organization, particularly in the context of IT staff augmentation. As it creates an absence of a skilled professional, it can hamper the progress and hinder the project timeline.

The longer time to fill a position can raise challenges such as a direct impact on productivity, increased costs, and a temporary resource gap. Companies can involve optimizing recruitment strategies, leveraging technology and automation, and implementing effective candidate screening and selection approaches.

5. Candidate Quality

Evaluating candidates’ experience, skill, and cultural fit is a crucial aspect of the hiring process of IT staff augmentation.

Assessing these factors helps ensure that selected candidates possess the necessary qualifications and attributes to excel in the roles and contribute to the organization’s success.

Skill assessment includes evaluating the candidate’s technical skills and expertise relevant to the job requirement. Companies can ensure that the candidate has the skills needed to perform the assigned task. Looking for experience can help gauge their familiarity with industry practices, tools, and techniques.

Apart from professional expertise, cultural fit assessment is equally important to ensure that candidates align with the organizational values, work environment, and team dynamics. Cultural fit encompasses communication style, collaboration approach, and compatibility with the company’s values and missions.

Selecting candidates with the right skills, experience, and cultural fit develops a foundation for success in IT staff augmentation.

10 KPIs in IT Staff Augmentation service

6. Retention Rate

Measuring the percentage of external staff who stay with the organization for a specific period offers valuable insights into the retention rate.

The metrics reflect the ability of the organization to retain talent and indicate the level of satisfaction and engagement among external employees.

A high retention rate indicates organizations that provide an attractive work environment for their external staff. It signifies that the organization successfully creates a positive and fulfilling workplace culture. Several factors, including competitive compensation and benefits packages, contribute to a high retention rate.

Organizations must invest in external staff’s growth and career advancement, demonstrating their commitment to their employees’ long-term success. Professional development initiatives can include training sessions, skill enhancement workshops, certifications, and mentoring opportunities.

7. Productivity

Measuring the amount of work done by external staff in a specific timeline provides a productivity rate.

The metric indicates the efficiency and output of external staff members and reflects how effectively they contribute to the organization’s objectives.

A higher productivity rate among the staff enables the organization to achieve business goals. It demonstrates that the external staff members effectively utilize their skills, knowledge, and resources to deliver results within the given timeline.

Staff augmentation helps enhance productivity by providing organizations with access to specialized skills and resources that may not be available internally. IT staff augmentation enables diverse expertise and fresh perspective, bringing innovation and improved project outcomes.

Evaluating the amount of work done by external staff and observing higher productivity rates indicates that staff augmentation enables organizations to achieve their business goals and objectives.

8. Cost Per Hire

Cost per hire is a KPI that measures the total cost incurred by an organization while recruiting, hiring, and onboarding external staff.

The cost-per-hire metric provides insights into the financial efficiency and effectiveness of the staff augmentation process.

Through cost per hire, organizations can ensure a cost-effective solution when hiring new talent. Cost per hire metric can assess the efficiency of their recruitment and onboarding practices and make informed decisions to optimize resource allocation.

Lowering the cost per hire can be achieved by applying various strategies. For example, organizations can optimize their recruitment efforts by leveraging cost-effective sourcing channels, such as online portals or social media platforms, to reach a vast talent pool compared to traditional methods.

Measuring the cost per hire is an important KPI for measuring the financial efficiency of the staff augmentation process. A lower cost per hire indicates that the organization effectively utilizes its resources and optimizes recruitment and onboarding processes.

9. Time to Productivity

The time to productivity reflects the efficiency with which external staff members are integrated into their roles and can contribute effectively to the organization’s objectives.

A shorter time to productivity reflects that the organization has an effective onboarding process. The external staff is well equipped with the necessary knowledge, resources, and support to the work environment and start making meaningful contributions.

By providing a structured and comprehensive onboarding experience, organizations can accelerate the learning curve, reduce the time it takes for external staff to be productive, and maximize their efficiency toward the project. A well-designed process helps achieve employee engagement, job satisfaction, and retention.

Organizations must evaluate and improve their onboarding processes based on feedback and outcomes, which can enhance the time it takes for external staff to become productive. Therefore, it’s important to have a track of the time to productivity, which helps in achieving better business performance and goals.

10. Client Satisfaction

The satisfaction level of your client reflects the extent to which the organization has successfully met the needs and expectations of its clients through the engagement of external staff members.

A high client satisfaction rate indicates that the organization is delivering quality services. The external staff assigned to the client should possess the necessary skills, expertise, and professionalism to fulfill the client’s requirements.

The satisfaction signifies the organization has a strong understanding of client needs, effective communication channels, and a commitment to delivering value-added services. Organizations must prioritize effective communication, regular feedback loops, and proactive problem-solving to meet client satisfaction.

Related Read: How do we Not Only Make Our Customers Happy but Actually Thrill Them


Maximize Performance with Tailored KPI Solutions Today!

Considering an IT staff augmentation service provider like Mindbowser can be a valuable decision when meeting your IT staffing needs. As a trusted partner, Mindbowser offers reliable solutions for building a strong and reliable workforce, expanding your capabilities to meet global demands. With our 24-hour coverage, you can receive real-time assistance from around the globe, ensuring uninterrupted support and guidance for your projects.

Leverage our services to effectively handle larger workloads and cater to more complex and demanding clients. Contact us today to take the first step toward unlocking your business’s potential.

Frequently Asked Questions

What is the significance of tracking the KPIs in IT staff augmentation service?

Tracking KPIs in IT staff augmentation services holds immense importance for businesses. Key performance indicators serve as a metric that delivers valuable insights into the effectiveness and success of the staff augmentation strategy. Organizations can monitor and analyze these metrics and enhance the effectiveness of their staff augmentation strategy, and drive the achievement of goals.

Which important KPIs should be tracked in IT staff augmentation service?

There are several KPIs you can track to ensure effective evaluation and decision-making. Amongst these KPIs, the most important ones are; productivity index, time-to-fill, time-to-productivity, candidate quality, retention rate, cost per hire, and client satisfaction rate. Monitoring these metrics provides insights into financial performance, resource allocation, candidate selection, onboarding effectively, project timelines, productivity, and client satisfaction.

What is the cost per hire, and why is it an important KPI in staff augmentation service?

Cost per hire is a KPI that measures the total cost incurred by an organization to recruit, hire, and onboard external talent in IT staff augmentation service. The metric includes expenses associated with sourcing, hiring, interviewing, onboarding, and any other recruitment-related activities and processes. Organizations can track this metric and evaluate the recruitment and onboarding expenses, ensuring efficiency in resource allocation, and maximizing the ROI.

How can organizations use KPIs to improve their IT staff augmentation service?

Organizations can leverage KPIs to enhance their IT staff augmentation service in many ways. By analyzing these metrics such as production rate, time to fill, client satisfaction, candidate quality, retention rates, and cost per hire, businesses can gain insights into the performance of external teams and make efficient decisions.

Content Team

This blog is from Mindbowser‘s content team – a group of individuals coming together to create pieces that you may like. If you have feedback, please drop us a message on contact@mindbowser.com

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