We seem to be outsourcing everything these days. Home-delivered meal kits provide gourmet dinners; a gig-economy worker runs errands; a professional dog-walker looks after your pets (and your pets love them more than they love you!). Personal outsourcing is a new growth area, but businesses, educational institutions, and governments have been outsourcing a variety of services for many years. How do you decide what your organization should outsource, and what you should keep in-house?
Your core business or mission is an obvious dividing line in any outsourcing decision. If you’re not in the accounting business, or the fulfillment business, or the marketing content business, you may be better off outsourcing some or all of those functions. Time spent in bookkeeping tasks, for example, is time taken away from your core business.
Two more dividing lines are task frequency and complexity. If it’s a routine task that can be accomplished in a few hours per week, then it should probably stay in-house. However, a man-hour-intensive one-time or occasional project might be appropriately outsourced. And if the task is complex, with a long learning curve for your staff (particularly if the task is unrelated to your core mission), it’s probably better to outsource.
Another deciding factor: automation vs. human time. No doubt many of your business functions – inventory reports, let’s say – are already automated, and outsourcing doesn’t save time or money. Others can’t be automated in-house without a significant investment of time, staff, and equipment. For example, you could assign staffers to a document conversion project, and have them spend hundreds of man-hours ingesting documents and encoding them with DAM metadata and Section 508 accessibility codes. But the hard costs would add up quickly, and staff would be pulled away from their primary functions. Outsourcing to a specialist vender with automated document conversion systems makes much more sense.
When you begin looking at outsourcing, always run a cost-benefit analysis to make sure you’ll get value for your bottom line. Smart Hustle Magazine offers a useful template to see if outsourcing will, or won’t, pay for itself.
And finally, take a look at your own management style. Outsourcing requires managers to relinquish control. Ask yourself what business functions you’re comfortable handing off to an outside vender, knowing that you will lose a measure of control. Who would you trust to have your company’s best interest at heart? If you don’t already have relationships with great outsourcing venders, reach out to colleagues to get their recommendations for trustworthy venders. Then you can turn your attention back to the things that make your business a success.
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