The Do’s and Don’ts of successful business outsourcing
30th December 2010
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Unfortunately even today many small businesses I meet at networking events and online believe they have to do everything themselves in their business. Many are concerned they can’t afford the cost incurred with employing others or don’t know how to manage the staff. However instead of hiring someone full or part-time, outsourcing can be time and cost effective, allowing you to work on what you do best. Outsourcing business administration tasks lets you devote time to marketing and advertising, enabling you to generate more sales, more business, talk to more clients – activities that bring more value to the business.

You should definitely consider outsourcing vs do-it-yourself when:

  • You don’t have the expertise – consider the time it will take you to learn and master a new skill or technology vs paying someone to just get the work done.
  • The workload is too high – consider the lost opportunity costs, will your business be able to grow without these tasks being taken care of?
  • There are temporary busy periods – to avoid the “feast and famine” cycle many solopreneurs go through, consider balancing your workload more effectively.
  • You don’t have the equipment for the task – is it worth investing the cash into buying the equipment or software? What about learning how to use it properly, maintenance, upgrades, support and the actual time it will take you to get the task done? Is it really worth it?
  • You don’t have the resources – as well as investing cash into buying the resources, you will need to consider storage, security, increased insurance, actual production time and costs, extra equipment and expertise to make the products. Will this leave you with sufficient time to get out there, market and sell the final product?

There are many advantages to outsourcing. Most of those start with “you don’t”:

  • need to hire, train and supervise new employees along with the additional paperwork involved.
  • need to budget for increased tax, holiday and compensation costs.
  • require extra space or amenities, new equipment.
  • have to learn new programmes and acquire more skills.

What “you do” get is quite important to any small business:

  • get more time for marketing, developing new products and services, increasing sales.
  • have the time to listen to your customers and build solid relationships.
  • have the ability and flexibility to take a new idea and build what your customers need.
  • give your business a chance to think big and grow.

So how do you go about outsourcing your workload to other business professionals?

  1. List all the tasks in your business that you are currently doing yourself or would like to get done, but never have the time or skills to complete
  2. Work methodically through your list, asking yourself “If I don’t do this myself, regardless of how experienced/intelligent/well-trained my partner is, will my business grow?” Move the task into the YES column (it can be outsourced) or NO column (you will still have to do it yourself for now).
  3. If you are honest with yourself you will be surprised how many items on your list will move into the YES column!
  4. Next you need to group them into business areas: finance, administration, HR, production, research, sales, IT, etc.
  5. Finally you will need to find suitable partners who can assist you with one or more areas from your list. You may find it easier to manage less suppliers each dealing with a large number of tasks, or find a business manager who will manage as many smaller suppliers as you need to complete each individual task.

What next? Repeat the process with your NO list every 3-6 months. The more you outsource, the more liberating it will feel. The more you will be able to let go next time you are going through the process.

To gain the most advantage from outsourcing you will need to manage the relationship with your suppliers by having regular reviews of the tasks you outsourced, results they have achieved, processes you asked them to follow, your goals and expectations.

Our final piece of advice: No matter how good your supplier is, don’t expect them to get everything right 100% from the beginning. They don’t know your business like you do. They will have questions and will need your guidance around your expectations, processes and systems. And they certainly are not mind-readers! So clear and concise communication is the key to a successful outsourcing relationship.

About the Author

Tamara B

Member since: 8th May 2012

I'm a Virtual Assistant offering secretarial, book-keeping and social media marketing services to small businesses and self-employed professionals. I design and write e-newsletters, blogs, websites and...

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