Too much on your plate? Delegate! Unable to grow your business at a healthy pace? Stop doing things others can do for you. You need to focus on selling, new projects, new methods, acquisitions – the things others can’t do.
One way to delegate is to outsource (get help from someone other than an employee). Some of the benefits of utilizing an independent contractor include:
- Talent and expertise are available on a part-time or short-term basis
- No need to provide office space, phone, computer, etc.
- Avoid payroll tax, unemployment tax, benefits, and vacation expenses
- No need to worry about having enough work to hire an employee dedicated to that task or job
- Termination of an outsourced employee is typically easier
- Management burdens are lessened as you focus exclusively on whether the task is completed on time, as desired, instead of what time they show up or how long they take for lunch
What functions should a business outsource? The generally accepted answer: all “noncore” functions, meaning functions that aren’t critical to the unique value you and your firm provide. Your firm gets paid for the technology integration projects it completes. For every minute spent on noncore activities (marketing, bookkeeping, etc.), you may be losing money.
Ask yourself what functions your employees are performing that you might be able to get someone else to do with better results. Billing? Collection? Human resources? It makes sense to spend your time and money within your employees’ areas of highest expertise, and get others to perform the rest. If outsourced efforts fail, you can always bring the function back in-house.
Find Outsource Providers
Once you identify a job or function to outsource, consider the type of person or firm you think would be ideal. Do you want to work with an individual or a company? Where will you get the highest level of service?
Working with an individual vs. a company, you’ll often find:
- They seem to place more importance on relationships
- They may provide a higher level of service as opposed to large organizations that have many clients (some much larger than you)
- Individuals may charge less
- Qualified individuals may be very difficult to find
- A once-reliable person may become unable to perform, whether it’s due to workload, financial situation, lifestyle change, etc.
Working with a company vs. an individual, you’ll often find:
- They have the ability to continue on with your business relationship even if your contact leaves
- A firm is typically in business longer than any one freelancer
- Better billing and payment handling tools
- Agency agreements and contracts ensure that you will always have someone to answer your questions and act accordingly
- Costs will likely be much higher
In your quest, you’ll likely find some duds – whether they’re individuals or companies. When you do, just cut the relationship off quickly and try another. Ask for referrals through your banker, trade association, or a networking group.
Outsourcing noncore functions is a strategy you must consider to reduce cost, improve quality, and allow you to focus on the value-add areas of your business. –-David L. Perkins, Jr.
Image by Stuart Miles