For outsourcing newbies, there might be a lot of questions that you wanted to ask about. For example, what is outsourcing, its benefits, the pros, and cons, what functions should you outsource, etc. To help you, here are some questions to guide you and familiarize you with outsourcing.
What is Outsourcing and What Should You Outsource
Outsourcing is a business method of hiring another firm or organization outside the company to execute services and create goods, usually done by in-house talents. Technically speaking, you can outsource all functions of your company to another firm. However, there are some tasks that most companies choose to outsource because they’re too repetitive or eats a lot of time and resources despite not helping in generating income.
In that case, the following are the tasks most outsourced by companies, especially small businesses:
- IT services
- Digital marketing
- Human resources
- Customer support
Where Should You Outsource Your Business
Anywhere. It really depends on your company’s needs and budget. With the technology we have these days, you can technically hire a firm from within your country or outside your country. Hiring within your country (onshore) is the best choice if you’re not confident with the language barrier or cultural differences compared to hiring outside. However, it is probably more expensive. When you hire outside the country (offshore), it is cheaper, although cultural differences might become a problem. In between is hiring someone near your country (nearshore) where the culture and language might not be that far and is not as expensive when hiring onshore.
Why Should You Outsource
There are a lot of benefits you can get from outsourcing. Also, it helps you expand your business effectively. Many businesses usually outsource to save money and focus their own in-house talents on the company’s strategic tasks. However, aside from those, there are other benefits from outsourcing. For example, getting professional and skilled services, access to technology and infrastructure, increase efficiency and technology, and so on.
Who Should Outsource
Anyone can outsource. People have this misconception that only big companies can outsource. However, technological advancement made sure all businesses in whatever scale can access this business method.
When Should You Outsource
Karlene Agard, ARAVUN’s senior risk and value management consultant, says as early as you can.
Agard told Forbes that you should outsource once you start getting a consistent flow of clients in your business. Once you gain more clients, you will begin repeating the same tasks over and over, taking a lot of your time and money. That doesn’t sound good for any business, and it might eventually hinder a business’ growth.