In a managed services model, an outsourcing partner takes complete ownership and accountability for a core business function, whereas in staff augmentation, a business uses experts employed and managed administratively by the partner, but integrated into the client’s internal team.
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In a Managed Services Model:

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• The partner takes full responsibility for the design, delivery, and quality of operations
• A flat monthly fee covers everything from salaries and management to infrastructure and security compliance
• 24/7 talent management, quality assurance, recruitment and staff replacements are included in the monthly fee
• The partner is responsible for meeting KPIs and performing audits, allowing internal leadership to focus on strategy

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In a Staff Augmentation Model:

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• The client has complete control over the daily operations, training and management of hired staff
• Hired experts are fully integrated into the internal team and existing workflows
• The provider typically charges a fee on top of labor costs
• Selecting candidates from CVs, negotiating salaries, and handling daily HR tasks is the client's responsibility

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Managed services models work well for customer support, content moderation and data operations by removing the management and cost overheads from the business.
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Staff augmentation is better suited to businesses looking to hire experts like software engineers on a short-term basis, without losing oversight of proprietary development.