As your business grows, you’ll encounter dozens of important tasks and responsibilities that must be handled in order to keep operations running smoothly. And, in many cases, one of the toughest parts is knowing when to outsource.
The Pros and Cons of Outsourcing
Outsourcing is simply the act of assigning a business responsibility, challenge, or need to someone outside of the company. In some cases, it’s a smart idea. In other situations, it makes much more sense to handle the task in-house. So before diving much deeper into this discussion, let’s examine some of the pros and cons of outsourcing.
Pros of Outsourcing
- You get to spend your internal resources and time focused on tasks that matter most to the core of your business.
- Your employees are able to focus on their own areas of specialty, rather than trying to tackle a project or task that doesn’t fit their skillset.
- Thanks to agencies and online networks, you have access to freelancers and contractors all over the world (which lowers costs and increases your chances of completing a project quickly and on-time).
Cons of Outsourcing
- There’s always less control when it comes to offloading a task to someone that isn’t on your company’s payroll.
- Outsourced partners don’t always understand how your business functions, which can lead to inconsistencies in the end product or service.
- Depending on how much work is being assigned, it could be more expensive to complete a single project/unit/etc.
- When an outsourced partner isn’t working in your office, communication can feel strained and inconsistent.
4 Signs You Should Outsource
Consider, as an illustration, that you’re involved in a serious car accident. While you have the right to pursue a claim or lawsuit on your own, it makes much more sense to hire a car accident solicitor or lawyer to ensure you get what’s owed to you. It’s much more efficient and effective from a productivity, expertise, and financial perspective.
The same is true in business. While there isn’t a manual that tells you when to outsource and when to keep a task in-house, you can use your common sense to make the right call. And though you have to proceed on a case-by-case basis, here are some signs that you should be open to outsourcing:
1. It’s Not a Core Competency
“You never outsource your core competency. Conversely, you should always consider outsourcing what is not core to your company,” entrepreneur Paul Blough writes. “Small businesses in particular can often greatly enhance their IT service by outsourcing to someone who specializes in supporting their industry. This frees them up to focus on working on their business.”
This is the first place to start. By thinking of tasks in terms of core competencies, you can quickly narrow down the best course of action.
2. It’s a General Task
Even if you can handle a task in-house, it sometimes makes more sense to offload it. For example, there are thousands of people who can handle your accounting. It might be more cost-effective to work with an outside accountant than to do it in-house. This will save you money and nobody will be worse off for it.
3. You Don’t Have Time
If there’s a task that needs to get done, but your team is occupied with more critical challenges, you may consider outsourcing. It’s perfectly fine to outsource a task for an isolated time frame and then bring it back in-house when you have time in your schedule.
4. There Will Be No Disruption
A task is a good candidate for outsourcing when you’re able to hire it out without causing any disruption to business processes or customer experience. Sometimes this is something you only learn through experience.
Putting it All Together
The ability to strategically outsource certain tasks and responsibilities is a weapon for businesses. Sometimes the weapon is used well, while other times it’s a double-edged sword. As you look for ways to improve your productivity and beef-up the bottom line, you’ll need to figure when the timing is right and maintain enough discipline to keep things in-house when there aren’t enough benefits to justify the decision.