When is Outsourcing Appropriate?

At one point or another, a business owner has been faced with the temptation to outsource.  Regardless of the size of their company, it is very likely to be a thought they often revisit, if not indulge in. It’s awfully enticing to know that you could pass off some of your work to individuals or companies who are not only more capable, but would achieve better results in much less time than your efforts alone ever could. Combine this with the subsequent reduction in your overall workload and the reasons why businesses are tempted to outsource become a lot easier to understand.

A trend has arisen in the recent decades regarding small business owners and the hiring of independent workers. It’s definitely not abnormal – businesses have been doing it with the likes of lawyers and accountants for years. However, now it’s become apparent that businesses are beginning to outsource a whole range of services, at a much higher rate than before.

This recent increase is pursuant to several factors. Technological advancements for one, have allowed us to bring specialised skills and tools into mainstream use. The latest PC’s, photo shopping software, operating systems etc. are available for anyone who is wanting to use them (given they know how). Equally, the internet has made it easier than ever to scope out individuals who are willing to do the tasks you’d rather not be doing. Garnering feedback on said tasks is also easier than ever, with technology paving the way for fast communication. You’re able to liaise and negotiate with skilled professionals across the globe by the click of a button, without sacrificing hardly any time or money.

The rise in outsourcing is also thanks to the lasting effects of the GFC, which has resulted in a job market brimming with skilled specialised individuals who are offering up their services outside of well-known organisations. Of course this is not the only way to outsource, established corporations and large scale companies offer many outsourcing opportunities, whether it be in the field of IT, or Marketing – you don’t always have to go with the independent freelancer. However, if you want your company to perform at its best, with the least amount of money involved and have access to a global market with endless resources, then outsourcing seems to be the way to go.

That being said, outsourcing still may not be something your company needs. There are several questions you need to ask yourself in order to be able to decide what the best route is. As amazing as its benefits are, outsourcing does have its cons, and those cons could mean its implementation in your business is less than appropriate.

Here is how to tell when you should and shouldn’t outsource:

Should

• The cost of the time it would take for you to try and do it yourself outweighs the cost of hiring someone else to do it for you.

If the costs of the service are lower than the cost of the time and manpower it would take for you to complete it in-house, than perhaps you should think to outsource it. Would it enable your company to run more efficiently, and leave more time to focus on the bigger picture? Outsource it. A lot of what it means to be successful in business relates to how good you are at prioritising your company’s needs. Prioritise time and efficiency and you won’t be let down, even if you have to take a risk in trusting an ‘outsider’ with the task.

• You want it done right

It’s not always true that if you want something done right you’ve got to do it yourself. Sometimes its best, especially as a business owner, that you put your pride aside and let those who truly know what they are doing take the work off your hands. It’s highly likely that there is little competitive advantage to performing the task in house, if not, you wouldn’t be faced with this issue! Relinquish the control and relish in the fact that there are a myriad of options out there as to who you can pass the work of to. And, you can probably guarantee that they’d do the work much better than you ever could in half the amount of time. These people possess the skills and expertise you don’t, there’s nothing wrong with that – if anything, use it to your advantage.

• It’s a particular service that you don’t need to maintain regularly

If you don’t need the service regularly, it makes no sense for you to open up a dedicated department within your company. Perhaps only a few campaigns a year require marketing assistance, or you’re looking to design a website. This is a fantastic opportunity to outsource a task. Outsourcing can be done on a large scale, but often it isn’t. This is a perfectly acceptable way to gain the benefits of outsourcing without engaging in a full scale operation.

Shouldn’t

• It’s too risky

Financially or otherwise, it just doesn’t feel right. Perhaps you haven’t found someone whom you think you can trust, or so far you’re not satisfied with what’s immediately available. It’s better to be safe than sorry, and if you can’t see huge benefits to outsourcing than perhaps its best to just tackle this task in house. You have to decide for yourself what’s more worth it.

• It will negatively affect your employees

Outsourcing can affect both current and prospective employees. For the current employees, having to deal with outsourced employees isn’t as glamorous as it sounds. It can be frustrating dealing with outside individuals who often times don’t share the same time zone, let alone continent. Coordinating and maintaining a company culture is hard enough as it is without the added pressure of keeping an eye on freelancers. For prospective employees, it can be an even bigger turn off. If you’re hiring for a marketing company, but you outsource the majority of your marketing needs, it’s likely the individual is going to assume that your employees aren’t valued. Make sure the way you outsource doesn’t contradict the pillars of your company.

• You aren’t in a position to properly evaluate the work

As mentioned above, sometimes you don’t know best. If you decide to outsource some of your tech needs for example, and aren’t in a position to evaluate the effectiveness, efficiency and quality of the work you’re signing off, then perhaps you’re better off developing those skills in house. You need to be knowledgeable about the work you’re outsourcing. You don’t have to be able to do it, but you have to be able to know if and when a jobs been well done.