The Benefits
Outsourcing usually brings important benefits:
– Cost savings – this involves offshoring (companies recruiting workforce from abroad mainly for the reason it’s cheaper). For some it’s a necessity, for others just a business decision to maximize profit. Many large companies were forced by the recession to cut down costs and chose outsourcing by necessity, which stirs lots of controversies nowadays.
– Focus to core business tasks – the company may fuel investment and people’s force onto main processes of the business, leaving aside the non-essential energy consumers. Outsourcing raises the predictability of variable costs, which is another benefit.
– Quality increase – outsourcing provides access to both technology (logistics that the company could not afford by itself) and knowledge (skills, intellectual property). This enhances the in-house ability for product innovation and boosts the image of the company from customers’ perspective.
– Contract and other legal advantages – externalized services imply having a legally binding contract that offers the possibility of applying penalties and special conditions. Also, tax incentives for hiring outsources in some countries can be remarkable.
– Scalability – you won’t have to worry about temporary decreases in productivity, the outsourced company will usually be able to manage such fluctuations and integrate positive deviations too. This is a main advantage of having an external workflow.
– Liability – companies developed on a lot of ramifications often transfer liability over some concerns that are outside their core competencies to outsourcers.
– A fair open schedule – you hear a lot of talk over the work-life balance and how to optimize it. Well, outsource some of your leg work and it’s achieved!
When to Outsource
There are various concerns regarding outsourcing, as it’s an important decision that will potentially shift your business processes. They are not decisive issues, but it’s important to anticipate the risk in order to minimize it. Main issues of outsourcers sound as following:
– “I won’t be able to supervise things as I do with my in-house workers.”Distance and time zones can be obstacles for exchanging feedback, so it may be less frequent than for internal processes. There are various software solutions for communication and employee management that will help you overcome this (VoIP, instant messaging, time tracking software such as Paymo, cost and schedule assessment tools).
– “I fear my outsourcers are not as qualified as I would like.” Get to know outsourcers’ skills, expertise and know-how, also be willing to spend some hours training them in matters of your company in order to achieve the best results. This way you won’t have surprises and you will share the responsibility in case something goes wrong. Why do that when it’s easier to cancel the contract and maybe ask for compensation? Well, maybe it’s just me, but it’s more ethical to share responsibility, plus you won’t waste time in finding another outsourcer each time, and another, and another…