Learn Valuable Outsourcing Information, Tips & Techniques
Outsourcing for Beginners
Are you ready to learn valuable information that will help you put outsourcing to work in your business? Understand the different aspects of outsourcing.
Today, you will receive valuable information on how you can successfully use outsourcing to get more done and grow your business. First, we are going to go over some of the basics so you can gain a better understanding of how outsourcing works and how you can use it to your advantage.
Outsourcing is a term that is becoming increasingly popular as more and more people are making the move to self-employment. Despite the increasing trend in companies relying on outsourcing there are still some who don’t clearly understand what it is. Now let’s examine some of the basic fundamentals of outsourcing.
The big question – What is outsourcing?
This is the first question many have about the subject. They aren’t interested in the many aspects of the process because they don’t really understand its benefits. In the simplest terms outsourcing is when a company delegates the completion of certain tasks to an individual not employed by the company directly. This individual may be an independent contractor or an contractor of another company who is subcontracted to complete these tasks. In exchange for the individual’s services they receive monetary compensation.
Most people assume outsourcing only applies to situations where large corporations have products manufactured overseas by a subsidiary and don’t realize that outsourcing can be used by any sized company for just about any type of project or task that needs to be completed.
– There are two major types of outsourcing domestic and overseas:
Domestic outsourcing is where both the primary company and the independent contractor or subsidiary are located in the same country. One of the main reasons for outsourcing is to reduce costs because it’s not always necessary to outsource work overseas in order to reduce costs, which we will discuss greater detail in just a minute.
Overseas outsourcing is the type of outsourcing most people already understand. This is where large corporations such as Nike, and even some smaller companies, employ manufacturing plants overseas in third world countries to up-size their profits. This is significant because their costs including wages, materials and building lease would be considerably higher in the United States than they are in these other countries.
The benefits of outsourcing
Now that you have a better understanding of the concept of outsourcing, you might wonder why companies would go to the trouble of outsourcing certain tasks. Well, it’s because there are a lot of benefits, including:
- Reduced labor costs
- A larger workforce
- Increase productivity
- More flexibility
- More expansion opportunities
- Increased revenue
One of the main reasons many companies make the move towards outsourcing is that it can significantly reduce costs while increasing revenue. Especially in the case of manufacturing tasks, costs can be cut dramatically because there are lower wages and costs associated with managing and maintaining the manufacturing plants.
These savings can also be enjoyed when outsourcing tasks domestically because when you hire independent contractors as the employer you don’t have to provide benefits such as social security, Medicare and workers’ compensation etc.
Another big benefit is access to a larger workforce without actually hiring additional contractors.
When you take the time to build working relationships with qualified individuals you’ll have more opportunities to pursue new work because you know you’ll be able to rely on these qualified workers to help you get the work done so your business will have more opportunity to grow.
Finding ways to outsource in your business
The good news is that in almost every industry there is the opportunity to outsource at least some of the common tasks that need to be accomplished.
In some industries there may only be one or two tasks that can be handled by independent workers for hire while in others it’s possible to outsource a big majority of those tasks. In either case it can result in a much lighter workload, more freedom and increased in profits long-term.
The first step in finding ways to outsource is to take a close look at your daily activities you perform when tending to your business.
Make a list of these activities and note any related activities that are typically performed in conjunction with them. Making this note is important because activities that are typically performed together should either be outsourced together or remain in-house to maintain the highest level of productivity.
Once you have compiled this list of activities, carefully consider which activities can easily be performed by another person and which ones require your personal attention. This will give you a good idea of which activities you can outsource and which ones you shouldn’t.
Next, review your list of activities and note how long it takes you to perform each of the ones you could outsource. This information will be helpful later when you start searching for a candidate to complete the tasks.
Time to prioritize
After you have carefully examined your daily activities, it’s time to prioritize them and create a comprehensive list in their order of importance. For this list include both the activities requiring your personal attention and the activities that can be outsourced.
When you are ready to start outsourcing, start with the highest priority on the list that can be outsourced then attempt to outsource it as a test to determine whether or not outsourcing will work for it. If you decide you are comfortable with outsourcing and that it’s working for your business, you can continue down the prioritized list attempting to find freelance workers capable of accomplishing the tasks.
We have already discussed the importance of evaluating your own daily tasks, but it’s also important to consider tasks completed by your staff members if you have them. Administrative tasks such as data entry, transcription and other are a great place to start because they can often be easily outsourced in order to increase efficiency.
Lastly, develop a plan for managing your outsourced activities
Before you starting to outsource daily tasks and activities, you should develop a plan for managing them.
This plan should include the following:
- Method for selecting candidates to handle outsourced work
- Method for overseeing the work performed by independent contractors
- Method for evaluating the work performed by independent contractors
Once you have your plan in place you will want to start looking for professionals that you can hire to outsource your work to. The best place to get outsourcing professionals is on online job sites.
Here are a few places that you can begin your search in no special order.
- UpWork – http://www.upwork.com
- GetAFreelancer – http://www.getafreelancer.com
- Guru – http://www.guru.com
- PeoplePerHour – http://www.peopleperhour.com
On each of these sites you will find various job categories.
When you have a particular requirement, all you do is post your project in the relevant category and people who are interested will apply and bid for the job. While each site is different the concept is simple, and because the people who apply are genuinely looking for work you can be sure that you will receive plenty of capable applicants to choose from.
How to choose qualified candidates and set parameters for the tasks you need completed
When it comes to outsourcing tasks for your business the first time chances are you’re feeling overwhelmed and uncertain about the thought of relying on someone outside the company to complete work usually done in house.
The concern over deciding whether to outsource generally stems from not completely understanding how the process works.
Hopefully this information will help by providing you with some proven ways to:
- select qualified candidates,
- establish project parameters
- and setting deadlines for your projects
Selecting qualified candidates
One way to simplify the process of outsourcing is to give special consideration to selecting qualified candidates for the job. A well-qualified candidate will be motivated to do a good job and complete the task assigned in a timely manner.
This is one of the most important parts of the process because by taking the time to choose the right person for the job it will make everything go much smoother and increase the chances of successful completion of the project.
To find the right candidate for the job, place advertisements outlining the project requirements and carefully review each application that is submitted. Immediately disregard applicants who aren’t qualified for the position. Then review the applications of qualified candidates carefully and select a small group of the most promising ones. Next interview each of these candidates, verify their references and past work experiences to learn more about them, their abilities and work ethics.
After interviewing the final list candidates, it’s time to make a decision about hiring one for the job.
Don’t be discouraged if none of the final candidates seem right for the job because you are under no obligation to hire any of them. If you have time you can continue your search by placing your job advertisement again and look for new responses.
Establish definite parameters
When outsourcing, it’s important to clearly define the project parameters. This is critical because it’s important for the contractor to fully understand the tasks that they’re being hired too complete and when those task need to be finished, so that they can fulfill their contractual obligations in a satisfactory manner.
Failure to establish fixed project parameters and goals can lead to complications when outsourcing any type of project. For instance, the contractor may feel as though they have completed the project as it was outlined but the employer may disagree. When this happens there can be costly delays until the issues are resolved. If you’re unable to come to an agreement it might be necessary to employ a mediator to evaluate the contract documents and the work produced to determine if the terms were met.
Establish a firm deadline
Another important aspect of outsourcing is establishing a firm deadline for the project. This is the best way to avoid misunderstandings and to prevent missed deadlines. Setting milestone goals is also a very good idea because it gives you, the employer the chance to evaluate the progress of the contractor during different stages of the project and to ensure it’s proceeding according to schedule.
Ideally the deadline should be established before the candidate is chosen because it will help you to verify that the contractor is available for the duration of the project. As a matter of fact, scheduling should be discussed early on in the hiring process to avoid selecting an ideal candidate only to find out they are unavailable when their services are required.
Keep these guidelines in mind as you plan your projects and it will help make all aspects of the process much easier for you and for the person you decide to hire.
How to outsource without becoming overwhelmed
For many smart business owners, outsourcing is their secret to success. This is because there are many distinct advantages to the process. As we have discussed before it can reduce costs, reduce workload, increase profit potential and provide you with access to a larger workforce without maintaining a staff of contractors.
While all of these incredible advantages may make outsourcing seem like it’s an ideal resource in all situations unfortunately this isn’t true. There are certain situations when outsourcing should be used only when certain precautions are taken. It’s important to be mindful of these precautions to ensure that the project runs smoothly.
As we discussed in the last issue, when outsourcing it’s important to screen all applicants very carefully before hiring someone for the job. Awarding a project to an unqualified person can end up be a costly mistake especially if they turn in sub-par work or even worse, fail to complete the project. It can cause delays, setbacks and end up costing you not only time but money.
One way to avoid being outsmarted by fancy resumes touting the accomplishments of an applicant you’re considering is to verify all the information on their resume before awarding them the project. This may involve contacting previous employers as well as references to determine their capabilities and work ethic. Taking the time to verify this information will help to ensure that they are truly qualified to complete the project.
Clear project requirements
We touched on this briefly in the last issue, but it bears repeating. When outsourcing a project, it’s important to be very clear when outlining the project requirements. There is no such thing as to many details in this instance.
It’s important because it ensures that both the client and the independent contractor understand all the requirements of the project. Make sure that you get everything in writing. This includes preparing a contract that states the exact project details along with the time constraints, required deliverables and compensation. Taking this extra precaution will ensure that you don’t have to pay fees until the contract specifications are met. It can also be helpful if disputes arise and mediation is required to resolve the conflicts.
Regularly scheduled progress meetings are very important when you’re outsourcing. These meetings can be helpful to both you and the contractor. They should be scheduled often enough to ensure the project does not fall behind schedule, but not so often that it impedes progress.
You will benefit because you’ll remain in control of the project and can intervene if the contractor is heading in the wrong direction. They are also beneficial to the contractor because it can prevent them from making costly mistakes or being caught by surprise at the end of the project if he misinterpreted the requirements.
When outsourcing is a bad idea
- reduced labor costs,
- larger workforce,
- access to industry experts,
- increased flexibility
- and best of all a lighter workload for you
However, despite the obvious advantages there are some situations when outsourcing isn’t a good idea.
Although there are more than a few scenarios where outsourcing is a practical business option there are others where it isn’t the best idea. In these situations, it’s probably best to keep the work in-house.
Let’s go over a few.
When it’s too costly
As we have discussed in previous issues, one of the primary advantages of outsourcing is saving money on costs such as social security, health care, workers compensation and other benefits you most provide to full time contractors. When you hire a well-qualified person you’ll also enjoy increased efficiency which can also result in a cost reductions.
Despite these benefits, there are some situations where outsourcing can be the more expensive alternative and it may also lead to a financial loss instead of a gain. This may include a situation where the cost of outsourcing to a highly specialized expert exceeds the budget for the project. Fees for individuals with highly specialized degrees or areas of expertise are often quite expensive. Another possible situation is one where finding an individual qualified to complete specialized tasks would be too expensive of a process.
When you to lose control
Even when tasks or projects are outsourced the company responsible for the work likes to continue to manage the project and keep close tabs on the progress of tasks. It’s important for the company to continue to manage the project even after it has been outsourced because they are the ones who are ultimately responsible for the successful completion of the project.
Whenever an individual or company wants to deny the company access to project files or documents, outsourcing is a bad idea. The company who has the vested interest in the outcome of the project should never be excluded from participating in making decisions regarding the project.
Before outsourcing a task or project care should be taken to establish criteria for the management of the project. Depending on the length and complexity of the project it may also be wise to schedule regular meetings to provide updates on the progress of the project. During this time the contractor should provide the employer with all documentation necessary to evaluate the progress of the project and verify it’s still on track for completion by the established deadline.
When it’s not allowable
Sometimes outsourcing is not a good idea simply because it’s not permitted by contract requirements. Some project contracts may have stipulations stating the work cannot be outsourced to an individual or to another company. Inserting such a clause into a contract document is well within the rights of the clients.
When they hire a company to complete a project or task, they expect all work related to the project or task to be completed by members of that company unless they specified otherwise when negotiating the contract. Violating the contract documents in this situation is not a good idea. The company could be penalized by the client. Penalties may include withholding payment or refusing to award future projects or tasks to the company.
The benefits of outsourcing online tasks
When it comes to outsourcing, there’s little doubt that the biggest advantage is the ability to reduce costs while growing your business and increasing profits. We’ve talked a lot about this in previous issues, but as with all good things some people take this concept to the extreme by outsourcing everything they possibly can. This is especially true when it comes to content creation and internet marketing tasks.
In other industries, this strategy could quickly lead to disaster because it’s not hard to lose control when you are managing multiple projects and contractors. But for some reason, when it comes to online marketing this strategy can be very effective because it results in a much lighter workload with a substantially larger profit margin when used correctly.
Some of the online business tasks that can be outsourced include things like copywriting, content creation, web design, blog posting, graphic design, social media and the list goes on. If you run all or part of your business online then this can work very well for you just make sure that you keep the most important tasks, in house to ensure that you remain in control of your business.
Outsourcing content creation
Content is a great place to start because it can easily be outsourced. There are many talented writers offering their services who can create just about any type of content you need. If you need something a special you will have no problem finding someone who is for example, skilled at search engine optimization (SEO). These writers have the basic skills but are also capable of weaving keywords into the articles in a way which appeals to both search engines as well as your readers.
Just like the writing industry, there are countless designers who can create high quality websites that are both visually attractive and functional. There are your basic designers for general content sites and those who can help you build a well optimized ecommerce portal. Keep in mind, when hiring a designer, the ones with SEO skills are in high demand which means they will be more expensive.
If you are marketing your business online in any way you may want to hire someone to manage your website, blog or even your social media posts. These managers will assume the responsibilities for organizing and posting content to build your online presence. There are many tasks that you can delegate including ongoing SEO, social profiles, product promotions and so one, but you get the idea.
Keep in mind that special care should be taken when outsourcing management responsibilities. Take time to verify their qualifications and choose only high qualified candidates, this extra time will be well spent because it will make the process much smoother and you’ll yield far better results and profits.
Ways outsourcing makes online marketing easier
First, let me say that if you have a business and you aren’t utilizing online marketing methods to grow then it’s time to start, because it’s so much easier to develop your online presence when you know how to leverage outsourcing.
If you are like many business owners, most of the time you find yourself wearing many hats. By nature, you’re a hard-working and typically not afraid to roll up your sleeves and be involved in all aspects of your business. Chances are you have a hard time letting go of control and delegating responsibilities too. Don’t worry that’s not a bad thing. It’s what makes you an entrepreneur.
However, there is only one of you and it’s hard to keep up with everything you must do to grow your business, that’s why outsourcing your online tasks is such a great option.
This way you can keep your focus on growing your business and let other well qualified people do other things like brainstorming online strategies, developing your web presence, designing well optimized webpages, creating content, sending out press releases, etc. Pretty much anything you need it done online can be outsourced.
Two of the best places to start is by outsourcing copywriting and web design projects.
Outsourcing these two elements to professionals enables you to retain control of crucial elements of your business, like generating leads, customer acquisition and service.
First, leave the copywriting to the professionals
The copywriting required for a solid online marketing campaign is one of the first elements that can and often should be outsourced. The content you provide on your websites, as well as in press releases, sales letters and on social sites is likely the first impression potential clients will have of your business. So, it stands to reason that your sales copy should be well written, concise, informative accurate, persuasive and search engine optimized (SEO). With so many requirements it’s obvious this work should be completed by a professional copywriter.
The services of a quality copywriter, especially one with SEO skills, may be a more expensive with many charging close as much as $1.00 per word for optimized content. However, the return on your investment will be well worth it, because you will see much better results.
Let experts design and optimize your webpages
We have already discussed how writers with SEO skills are a valuable commodity, but it’s also important to note that web designers who possess these skills are valuable too! When your website is listed in the top of the search engine results people are more likely to find your business. A designer with these skills can make sure your web pages are well optimized to generate more traffic, which can lead to more profits for your business.
Make the process of onboarding new hires easier
Up until now we’ve talked a lot about the upside of outsourcing, but it’s important to keep in mind that there can be downsides too. You should always be careful whenever hire outside contractors for your projects.
This holds true even when you work with a temp agency or company that manages contractors like Freelancer, Upwork or Guru.com
While convenient these places have a high turnover rate and you need to be prepared to switch contractors frequently. When turnover occurs, it may not seem like a big deal, but it can end up costing your business a lot more than the extra time it takes to train new hires.
Generally, it takes approximately two weeks for a new contractor to get settled in and accustomed to completing task the way you want them done. This can slow down several different aspects of your business including sales, so it’s important to have a plan in place for training new contractors.
A good place to start is by communicating with them daily until they start. It lets them know that you’re committed to making the project work for both of you. Make sure that they are all set up and ready to go. This can start with the simplest things like having the necessary file drop procedures, software programs a reliable email account, usernames and passwords, etc. Don’t wait until the day the project is supposed to start and then rush around trying to get them everything they need to do the job.
Be a supportive employer, make sure that you provide new hire with all the information they need to do a good job for you. Be available for questions, and help them throughout the initial phase of the project. This will benefit both you and the contractor by making the job moving forward as scheduled.
Checklists are a great way to help new contractors stay on task and avoid unwanted confusion. Almost every process can be reduced to a series of steps that will ensure task completion without constant supervision. Think of them like a safety net for you when you don’t have enough time to manage your team members full time.
Record training videos of for common tasks
It is not hard to create screen capture videos. Most computers come with pre-installed software that makes it fairly easy to do. This is a great way to put complicated steps into a visual permanent record so new hires just have to watch video to learn your preferred process for completing common tasks.
It’s important to remember that the decision to outsource doesn’t end with hiring. In fact, it’s only the first step. After you hire you have to train so it only stands to reason that you should make the process as easy as possible for both you and your new hire.
Having realistic expectation when outsourcing
When it comes to outsourcing having realistic expectations is very important. As a business owner, chances are you have very high expectations for yourself and your employees. However, it’s important to recognize that not everyone can live up to the expectations you have for your business, no matter how hard they try.
Make sure you plan
Let’s say for instance that you’re asking your worker for a quick 500-word blog post, make sure you give them plenty time to research and write the post. Don’t say, “I want this done in an hour” and expect to receive quality work in return. While this may be possible for you to do, it won’t be for someone who isn’t as familiar with your business. Give them as much notice possible and you will receive much better results.
If you’re asking your worker for logo design again, make sure you’re providing plenty time for them to complete job. Sure, it’s possible to get a logo design done in a few hours but keep in mind that you’re probably not their only client, especially if they are really good at their job.
On the other hand, you don’t want to give your worker three weeks to complete a task that should only take a few hours unless you know them well and expect the job to be completed at the highest level of quality. If you’ve established a long term working relationship with them and you know the project only takes a few days, but they are so busy it will take them longer either factor that into your expectation, or send the work to another person.
When setting your expectations, always factor in buffer room.
If you need the project done in seven days, tell the person you hire that there is a firm deadline of five days. This way, if they are late, or if you have to edit or send the work back for revisions you will still be able to complete the project on time.
If you want your worker to be reliable and produce quality work, you too need to be reliable too.
This holds true in terms of project communication as well a prompt payments. You wouldn’t be willing to work without getting paid on time and neither will your worker. If they have to wait a long time for payment they will not be as willing to produce quality work for you. When you’re reliable and pay on time, you make them happy and they will be more eager to work with you and to produce high quality work for business.
How to raise the bar through outsourcing
The stereotypes associated with outsourcing are often very negative in nature. However, it’s possible to utilize the concept of outsourcing to receive the highest quality of work possible. Outsourcing no longer only refers to overseas sweatshops where contractors work long hours for meager pay. Outsourcing now also occurs domestically and often at prices which are more than generous.
Thanks to savvy entrepreneurs who realize the benefits of offering their services on a contract basis, outsourcing has become the wave of the future. This article will take a look at how outsourcing can actually lead to superior work and increased profitability.
Top quality work from industry experts
One of the most advantageous aspects of outsourcing is the ability to employ industry experts for the completion of certain tasks. This becomes beneficial in situations where a business is faced with a complex problem which is beyond the expertise of the in-house contractors. Outsourcing gives the business the opportunity to outsource the task of solving the problem to a highly qualified candidate.
Although the business may pay a hefty sum for the individual’s services this fee will likely be significantly less than what it would have cost them to solve the problem with their in-house staff. The amount of time it would have taken coupled with the potential for costly mistakes makes it clear outsourcing is the right decision in this scenario.
Another scenario where tasks may be outsourced to an industry expert is when the business is faced with the task of performing more work than they are capable of handling in-house. During aggressive deadlines or unexpected delays, outsourcing can be used to complete projects according to unyielding deadlines.
Many businesses balance the workload they take on based on the number of contractors they have on staff capable of assisting in each individual task. However, outsourcing gives businesses the ability to consider accepting more work than their in-house contractors can complete. An example of when this is beneficial is when consultants are awarded more projects than they had anticipated and are suddenly in a situation where they can meet their deadlines due to larger than anticipated workloads.
Another advantage to outsourcing is the ability to take on larger projects than usual. One of the most elementary factors often considered when awarding projects to consultants is the number of staff members who are available to work on the project. Clients evaluate this number with their project needs and schedule to determine whether or not they think the consultant is capable of completing the project on time. Consultants who outsource portions of their projects are effectively able to increase the number of contractors they can afford to have working on a project.
Finally, outsourcing can help companies to produce higher quality work by enabling them to reduce their operating costs. Outsourcing can save companies a great deal of money because they often don’t have to pay benefits such as social security, workers’ compensation and Medicare to those who perform work on a contract basis. Additionally, those who perform the outsourced work typically do the work from their own office meaning the company does not have to provide resources for the individual. Although these costs may seem trivial, they can really add up especially if outsourcing is used on a regular basis.
Combined with the reduced operating costs, many companies find that productivity is increased through outsourcing. By outsourcing work to qualified individuals, the in-house contractors are freed of additional responsibilities and can focus exclusively on the tasks they were hired to perform.
This is significant because without outsourcing these same contractors might be tasked with attempting to perform complicated tasks for which they aren’t properly trained or qualified. When this happens, there is a significant decline in productivity as the contractors take longer than necessary to complete the more complicated tasks and don’t have time to complete the simpler tasks.
The benefits of outsourcing (in general)
For many the most important reason for outsourcing is to reduce labor costs. Employers may not be obligated to offer benefits such as social security, Medicare and workers’ compensation to the workers who are completing the outsourced work. Additionally, these individuals often have their own offices and computer equipment and can complete their work offsite.
Labor costs can be a significant part of a company’s budget for the year. A company that can reduce their labor costs will be able to enjoy a greater profit margin without making any other changes to their business operations. There are certainly other changes which can be made to increase profitability but reducing labor costs is a guaranteed method of increasing profitability while other methods of increasing profitability such as marketing different niches will not guarantee success.
Another benefit of outsourcing is increased productivity. Greater productivity can be another cost savings benefit for companies. When work is outsourced there are many factors which contribute to increased productivity. Productivity may increase due to workers being assigned appropriate projects, workers being more efficient and less cases of underutilization.
Assigning workers to tasks that are beyond their capabilities is one way to cause a decline in productivity. While challenging employees to think for themselves and take on increasing responsibility is worthwhile, giving an employee and assignment he is not qualified to complete can be damaging to productivity because of the learning curve involved. Therefore, it is so important to outsource complicated software tasks to experts in the industry. They are often able to complete complex tasks quickly and efficiently.
Outsourcing also makes employees more efficient because by allowing individuals to focus on only one task at a time there is less time spent transitioning from one task to another. Many employees and employers think multi-tasking is a way to increase productivity but it can have the reverse effect. Employees with too many responsibilities may feel pressured to work on each task each day. This can be detrimental because each time the employee switches from one task to the next it is necessary to get back up to speed with the new task and remind himself where he left off when he stopped working on the project.
Finally, outsourcing can lead to greater productivity by reducing underutilization. For example, outsourcing very specialized projects requiring expert analysis is preferable to maintaining this expert on staff when their services are only needed occasionally. If this were a salaried employee he would be greatly underutilized. However, outsourcing these occasional projects to an expert prevents the underutilization phenomenon.
Another way outsourcing can save you money is through providing your company with increased manpower. This is especially important for smaller companies who would normally be precluded from attempting to secure larger government projects. This is because there are typically requirements regarding the number of employees a company must have available to work on the project. Maintaining a network of qualified individuals gives a company more bargaining power when negotiating larger contracts.
Outsourcing is ideal in this situation because it enables the company to work with highly qualified individuals when necessary without having to retain these individuals as salaried staff members. This is significant because niche experts often become so specialized that working as an independent contractor is their only option because as a salaried employee they are more of a liability to companies than they are an asset.
This is because many companies don’t want to bear the burden of keeping these people on staff when they can outsource the work to them on a per contract basis.
When outsourcing is the only option
Deciding whether to outsource certain tasks is something that many business owners face. This can often be a difficult decision at times but it can be greatly simplified when it becomes clear that outsourcing is the only viable option.
Sometimes outsourcing becomes the only option available because there are no in-house staff members qualified to perform a specific task. This often occurs when a task requires a highly specialized degree or area of expertise. When this is the case it doesn’t make sense to hire a new employee with these capabilities when they will only be needed for a short time.
However, if this task is required regularly, the question of whether to outsource the task becomes more complicated. As this article is focusing on situations where outsourcing is the only option, we will not delve further into the factors which complicated this decision such as labor costs and increased manpower.
Smaller companies often face the problem of not having staff members qualified for tasks more often than larger companies. Larger companies obviously have a larger pool of employees to pull from and it is therefore much more likely for the smaller firms to have gaps in their level of expertise than it is for larger companies to have these gaps.
In-house staff availability
Sometimes outsourcing becomes the only option based on staff availability. A company may have a need for tasks to be completed rather quickly. Although it may be a task for which several in-house employees are qualified, current workloads may make it impossible for these employees to take on these tasks. When this occurs, outsourcing again becomes the only option.
Company employees are often multi-tasking and may be working towards several serious deadlines at any one time. Management is tasked with the responsibility of doling out work to lower level employees and when they feel as though their in-house staff is not able to take on more work, they often turn to outsourcing as a solution.
Workloads often become a factor in outsourcing when there are projects which are particularly time sensitive in nature. Employees and employers often need to prioritize multiple tasks but there are times when certain projects or tasks become urgent simultaneously and when this happens it may become difficult to complete all of these tasks with only the assistance of the in-house staff.
Sometimes outsourcing becomes the only option because of client requirements. Depending on the complexity of a task, a client may require the consultant firm tasked with completing a task to have the task performed by an individual with specific qualifications. These qualifications may include specific training in certain types of software, exact education requirements or previous work experiences. Companies who do not have in-house employees who meet these specific requirements have no choice but to outsource the task to a qualified individual.
When this is an isolated incident, companies often outsource the task and do not make efforts to attempt to hire a full-time employee with these qualifications. This is a wise decision especially when the client requirements need an expert in a niche of the software industry. An employee of this caliber would be rather expensive especially if he would rarely be called upon to utilize his advanced skills.