Outsourcing responsibilities depends on your organization’s level of need, financial affordability, timelines, and management. With so many factors to consider, it’s important for leaders to know the benefits of outsourcing, as well as what tasks should and should not be considered for an outside service provider. Keep reading to see if outsourcing is your next best step to business growth, and if so, see how to make it a success.

What is outsourcing?

Outsourcing occurs when a company or organization hires an outside service provider to complete a specific project, or work for a determined amount of time. The relationship between two companies is sealed with a mutually agreed upon contract outlining expectations, responsibilities, and terms of service for both parties.

Outsourcing is often associated with offshoring, but they are two different phenomena. Offshoring occurs when U.S. companies outsource work to different countries and hire those citizens or foreign companies on a short-term, or contract basis. Outsourcing, on the other hand, takes place domestically, with U.S. companies. Some experts now refer to outsourcing as “domestic sourcing” to better convey the difference.

The Pros of Outsourcing

Outsourcing is attractive for many reasons related to cost, time, and specialty projects, but it doesn’t work for every role, task, or business. Organizations must analyze their in-house resources against their goals, compared to their budget to determine if outsourcing is beneficial for their bottom line. Outsourcing can be beneficial for the following reasons:

 

  • Lowered overhead costs related to onboarding, benefits, supplies, and space.
  • Improved company focus by reducing the amount of time and effort spent on solutions and resources that are not directly in the company’s wheelhouse.
  • Addresses new needs, wants, and demands from customers and employees without losing internal resources.
  • Gained access to thought-leaders and honed expertise with verifiable and proven success in their realm of business.
  • Get a fresh look at how business operations can be improved by outside parties with an up-to-date perspective and experience on changing trends.

 

Some areas that work especially well when outsourced include…

 

  • E-learning technology and curriculum development to streamline training and provide upskilling opportunities for employees to take advantage of digitally.
  • Website development gives in-house developers time to focus on specifics while the foundation of a website, or the minutia of general updates, are handled outside.
  • Payroll companies are often utilized to free up the human resources department for more personal interactions with employees.
  • Recruitment, another commonly outsourced task, because it can take a lot of time and requires specialized skills to find the right candidate.
  • Social media to gain a better understanding of this still emerging and constantly evolving tactic for marketing brands and converting consumers into customers.

 

Outsourcing to service providers can certainly be beneficial, and even crucial, to an organization’s level of success, but outsourcing isn’t a set-it-and-forget-it business tactic.

4 Tips for Successfully Outsourcing

Outsourced service providers exist to make things easier, better, more efficient, and more profitable for the companies and organizations they contract with. In order for them to achieve, they need the right tools, contact points, communication avenues, and expectations from businesses. Make your relationship with outsourced service providers prosperous by helping them to help you with these four tips:

#1 Collaboration is necessary.

To a certain degree, the service providers’ job is to deliver what’s outlined in the contract, however, there is typically more to it than just those expectations. The framework is outlined in the contract, but the specifics are ironed out between the two companies based on industry, company structure, digital capabilities, and expected outcomes.

For example, the goal of an outsourcing relationship may be to streamline employee training and provide e-learning opportunities for existing employees to gain new skills. The service provider can deliver on that goal, but it’s up to the company to determine the learning goals that the provider needs to consider when creating the training or curriculum.

Collaboration pulls from the strengths on both sides; the organization outsourcing knows what they want employees to achieve, and the service provider knows how to create definitive test questions, engaging games, real-life scenarios, and digitally build the tools that accomplish knowledge transfer. Not only does the service provider create the final product, but they impart their wisdom, experience, and perspective as a capable leader in their field.

#2 Set expectations.

A service provider can only give you what you want if they know what that is. During the vetting process, as you meet with different providers to choose the best fit for your organization, you should clearly and definitively outline your goals, needs, wants, and timeline.

If you’re establishing a contract with a social media agency, you’d want to define specifics like how many posts should go up a day, what categories those posts will cover, how much engagement is expected from each post, and what platforms will be utilized. It’s also important to think of the contract overall; will the service provider be handling social media marketing for a year, or until a full-time employee is hired?

#3 Introduce and emphasize brand identity.

Outsourcing is putting a level of responsibility on an outside party to act according to the expectations of the company. Make sure service providers have access to style guides and brand identity tools to deliver a product that matches your organization’s established brand. This is especially important with customer-facing products, but your company’s identity should be evident throughout.

Whenever a service provider is working on a company’s website it’s absolutely crucial that they understand the importance of branding and styling. Everything from font style to tagline, to functionality, comes from predetermined choices. If a contractor differs from or completely ignores these limitations, you’ll end up with more work for in-house developers, thereby possibly costing your organization more in time, finances, and resources.

# 4 Maintain open lines of communication.

Instead of checking in every now and again, outsourced service providers and the companies employing them should meet to discuss goal achievement regularly. Part of communication is determining when, where, and how you will meet, as well as what will be discussed and who will be present. Once these points of contact are determined, meetings will be streamlined and to the point, which is one of the benefits of outsourcing.

One reason some companies are choosing to outsource domestically, rather than offshore, is time zone and cultural understanding. It’s become increasingly difficult to manage employees that work on a completely different schedule from the rest of the team. Although video conferencing and other technology-based tools can help, having easy access to service providers can be a game changer for fast-paced businesses.

If you’re considering outsourcing at your organization, remember that it is an individual decision based on the complexities of your business. If you do decide to take advantage of the specialties of outside service providers, be sure to use the four tips above to make sure it’s a mutually successful relationship.