Most entrepreneurs feel that it’s important to have full control of their businesses, from the smallest tasks to the largest projects. This is understandable, given that as an entrepreneur, you did build the business from scratch.
A strong sense of ownership drives you to keep a close eye on all your business’ dealings, or else, things may go amiss if you don’t. After all, if you’re there to oversee everything, what could go wrong?
Unfortunately, such micromanaging system can be inefficient and even destructive for your business in the long run. When you fail to see the importance of delegating work, you end up getting bogged down by mundane tasks to a point where you don’t see the bigger picture anymore.
This problem is precisely what outsourcing aims to solve. Think about it: Would you rather hire an entire IT team for your business or choose the less costly path of contracting IT outsourcing services? Which one seems better and more cost-efficient in the long run?
If you’ve entertained the possibility of outsourcing before, then you’re not alone. Nowadays, more businesses are tapping into the benefits of outsourcing not only to reduce cost operations but also to increase productivity and efficiency.
Outsourcing has gone from being a trend to becoming a necessity in most business operations today. Research and statistics soundly back up this claim.
According to a 2015 study conducted by the Statistic Brain Research Institute…
44% of US companies have switched to outsourcing to reduce or control cost operations. Meanwhile, 34% did so to obtain access to IT resources that are otherwise unavailable within their company.
Based on the findings of the IT Outsourcing Statistics 2015 Report by Computer Economics Inc, helpdesk and web or e-commerce services are among the top tasks that companies prefer to outsource. Companies are also starting to depend more on outsourced staff for daily business operations. In various researches, 24% of business owners said that they work with freelancers on a weekly basis. An astounding 82% of small to medium-sized companies felt that their outsourced staff is vital for their business’ growth.
You’ve read the statistics; you’ve heard the research. They all say that outsourcing will give your company the edge to produce more quality output at a fraction of a cost. But, it’s not that easy to jump in and start sending out tasks to an offshore team in a snap.
As an entrepreneur, you may still have doubts about handing over the reins to people you don’t know and can’t even meet on a daily basis. Keep in mind, however, that outsourcing delivers enormous benefits for your company that far outweigh the risks in the process. In fact, you can even minimize those risks, which we’ll tackle later on.
For now, we’ll answer the question: Why should you outsource? The most obvious answer is to lessen operation costs. However, there are many more reasons that prove outsourcing as a beneficial business action.
There are tasks which you don’t need a full-time employee for to accomplish.
It wouldn’t be cost-efficient to hire a full-time web developer for your company to build a site, and even stay on the payroll as he checks on an already finished web page 8 hours a day right?
By outsourcing, you’re able to pay only for the services that you need. You can also consider hiring a freelance web developer to build the site. Then, when you need to update the site or other web services later on, you can outsource IT services to get the job done—all paid accordingly to the work they’ve rendered.
There’s the misconception that only large businesses need to outsource.
Small to medium-sized enterprises stand to benefit greatly from learning which tasks they should outsource early on. Further, a starting business may not have the space needed to house a large workforce.
By outsourcing tasks that are not part of your core operations such as payroll, human resources, or IT, you can operate on a smaller scale without necessarily cutting back on the workforce.
Repetitive and mundane tasks can also be outsourced while your in-house team focuses on core operations.
If you’re running a design company, you’ll certainly want your team’s focus to be on that. Inventory, data entry, and routine web updates are better left outsourced so it won’t take up the time you’re better off spending for your business’ key service itself.
Increased productivity is another obvious perk of outsourcing.
Imagine operating an in-house staff with only 10 people, but being able to deliver more output to your clients because you also have a team of outsourced professionals to back your business up.
Outsourcing makes it easy for businesses to grow at a lesser cost and time it takes compared to hiring full-time employees for every task that needs to get done.
While some may worry that having to work with a staff in a different time zone will prove to be difficult, the situation can actually play to your advantage.
For example, you can delegate tasks to your offshore team before you leave work.
When it’s time for you to head to bed, it’ll only be the start of your offshore team’s work day.
How great will it be to head to work the following day and find the task you’ve assigned already finished and ready for your review?
A common criticism against outsourcing is the possibility of receiving subpar work.
The truth, however, is actually the opposite. If you know how to choose which individuals to work with, you can have highly skilled individuals with specialized knowledge that can work for you at a lower cost.
Many professionals now prefer to work freelance, seeing how it lets them choose their working hours.
You can take advantage of this opportunity by outsourcing tasks that will require the said professional’s expertise without hiring them full-time.
For example, you may not be able to afford hiring a full-time financial analyst that you’ll only need to consult monthly for your sales performance. You can, though, find a freelancer who has the credentials to do just that and pay him only for the times when you’ll actually need his service.
When to Outsource
Timing is everything, so they say. This is especially true in the business world, where the market is unpredictable and today’s trend can quickly lose its charm tomorrow.
Likewise, you need to choose the right time and reason for outsourcing. Before you start outsourcing, define first your business’ core operations—that which you do best and what you started the business for.
Here are three questions to ask to determine if it’s finally time to outsource.
1. Is this task a primary service of my business?
If the answer is yes, then don’t outsource it. After all, it’s your business’ foremost offering to your customers. It’s what you’re supposed to be doing well.
Tasks that prevent you from focusing on your business’ core operations are the ones that should be outsourced.
2. Do I need this service full-time?
If you’re running a design business, then a graphic designer is vital for your operations. A help desk officer to answer questions about your packages, however, is not.
Outsource tasks that you don’t need full-time in your office. This includes clerical tasks, consultations, IT services, and customer support, among others.
3. Would it cost me lower to outsource this task instead of accomplishing it in-house?
At the end of the day, what you’re looking for when you outsource is to cut back operation costs. If it’s a task can be done by your available manpower already, then all’s good. But, if outsourcing it offers lower costs without compromising quality, then you’re better off in that arrangement.
The answers to these questions determine the necessity of outsourcing for your current business setup. Don’t start outsourcing just because you can, or everyone’s doing it.
By identifying first which working setup gives your in-house team more time to focus on your business’ core operations, you’ll be able to reap better rewards from outsourcing.
What You Can Outsource
The great thing about outsourcing is how it provides a large pool of talents available at your disposal. Whether you need a web developer, customer service representative, virtual assistant, graphic designer, or any other specialized task, there will surely be a freelancer eager to take on the job.
Here are some of the most common tasks outsourced today. See which ones you may need for your business.
Companies find it more cost-efficient to contract IT outsourcing services to handle various technology-related concerns in the company such as data protection, software implementation, network system setups, and troubleshooting.
Employing a freelance IT team also means that you’ll have access to the IT resources that you currently don’t have in-house.
Customers are the life force of any business, and as such requires utmost attention. Outsourcing your customer support desk means that, even when you’re not actually in the office, your customers won’t have to wait too long for answers to their queries.
When the help of an expert is needed for a particular consultation, consider outsourcing someone with the credentials. Not only will you have access to their expertise, the fee will most likely be lower compared to hiring them full-time.
Payroll can be time-consuming, and is better off left to an outsourcing team. Your outsource payroll staff can also handle taxes, worker’s compensation, and social security while you focus on operating your business.
Most companies can’t afford to hire a full-time company lawyer. It’s easier and cheaper, in the long run, to outsource a legal team when the situation calls for it.
Social Media Marketing
Since you’re focused on running your business, there probably isn’t time anymore to squeeze in monitoring your social media pages. Hire a freelancer to do it instead, so your social media pages stay updated and active.
Need a logo for a new product or a catchy jingle for an ad? Outsourcing your creative service needs can help you save money while still achieving the quality you’re looking for in the output.
Repetitive tasks such as inventory and cataloging, are better off delegated to an outsourcing team instead. This saves time, money, and effort from your team, and still gets the job done accurately.
These are just some of the ideal tasks for outsourcing. Browsing online reveals more comprehensive lists on what services outsourcing can bring in your company.
How to Find the Best Outsourcing Partner
Risks of outsourcing can often be eliminated if only one took the time to choose the right outsourcing company to work with. After all, you wouldn’t want to get stuck with an outsourcing team that is more trouble than they’re worth.
Here are some steps, as well as tips to keep in mind that will lead you to the best outsourcing partner.
- It’s not just about finding the cheapest labor out there. That low rate won’t do your business any good if the team you hired can’t produce an output up to your standards.
- Shop around various outsourcing sites to see the rate for the task you want to outsource. It’s not about who’s paying the least. It’s about finding the best workers that can help their business grow.
- Communication is essential to working harmoniously with your outsourcing company. Clearly relay the tasks you want to delegate, your goals, and your expectations to the outsource team.
- Take the time to provide them context on the project, so that your vision aligns with their output. It’s tempting to just dole out tasks as if you’ve picked up a genie in a bottle—“design a beautiful website!” or “sell this product to my customers!”
If you don’t provide your team relevant context, those commands still come off as vague and will not produce the results you want. Be clear on deadlines and workload before you start delegating tasks for a streamlined working process.
- Consider setting up a work management system for you and your offshore team. It can be as simple as a spreadsheet or checklist containing all their deliverables.
- Don’t micromanage them. Since you’ve already delegated the task to an outsource team, it’ll be counter-productive if you’ll still micromanage them from then on.
A quick glance on the checklist can give you an idea of the status of your projects without having to request for updates every time.
Growing Your Business
In a time when businesses are expected to deliver more for their customers, the outsourcing industry offers an invaluable resource of a quality workforce.
By delegating tasks to an outsourced team, you can focus more on what your business does best. It is, however, an approach that bears thinking and planning first. Don’t just join the bandwagon. Set clear goals first and see if outsourcing can really help you reach them. After all, when done well, outsourcing may just be the step you need to take for your business to grow.