Outsourcing is quickly becoming the norm for many companies. The benefits are clear — the cost savings, the ability to focus on what you do best, and the time saved. But before you go ahead with this decision, here are some things to think about when deciding whether or not to outsource certain business operations.
1. Determine if outsourcing will save money
Outsourcing is done for many reasons. One of the most common is to save money. While outsourcing can definitely do that, it is not a guaranteed benefit for every company. It’s important to first determine if your business needs are best fulfilled by outsourcing. Would it be more cost-effective to hire or train new employees rather than pay an outsourcing company to help with these tasks? For example, managed IT service providers can help you with your digital operation needs but you may benefit more from hiring an in-house IT specialist if you only deal with minor virtual operations.
2. Know if the company you are considering outsourcing to is well respected
It may seem like common sense, but it’s important to make sure the company you are considering outsourcing operations to has a good reputation for their work. There are many online review sites that can help you determine how satisfied other clients have been with the outsourcing company’s work. Sites such as Yelp and SiteJabber can help you see how clients feel about a particular company and what kinds of services they list as provided by that company.
3. Check if your company is comfortable with outsourcing
An often overlooked factor when considering whether or not to outsource business operations is how well your own company will handle the transition. Some companies outsource with little hesitation while others do not feel comfortable handing off such responsibilities to another company. Make sure you understand how your company will react when faced with such a change and whether or not outsourcing is really right for them before you make this decision!
4. Consider the consequences of not being able to oversee operations yourself
While outsourcing brings an array of savings and benefits, there are also some potential drawbacks. Not being able to oversee operations can result in negative consequences. For example, if your outsourced accountant makes a mistake on your books or provides incorrect information it will be more difficult for you to correct the issue than if you had handled these tasks yourself. Make sure you weigh the benefits and consequences of outsourcing compared with what will happen if you were to carry out these tasks in-house before making a final decision.
5. Be clear on what your expectations are
Before signing any contract it’s important to determine exactly what you expect from the company you’re considering using for business operations. Determine which tasks you would like them to perform and how you would like these tasks performed so that nothing is ambiguous. This will ensure that everyone involved knows what is expected of them, making it easier to complete these tasks correctly.
6. Do your research on the company’s competitors
When deciding whether or not to outsource business operations, it’s also crucial to look at the company’s competitors and compare services. Look at what they offer, how their rates compare with your current outsourcing company, and whether or not they provide faster service. If you find that a competitor provides better service for a lower price it might be in your best interest to switch companies.
7. Consider what will happen if the outsourced company goes out of business
Finally, make sure you fully understand what will happen if the outsourcing company you are considering goes out of business. You want to be sure that no matter what occurs, your needs as a company will still be fulfilled by this arrangement. For example, it’s helpful to have an outsourced agency that provides services such as website design or management, tax preparation, or bookkeeping because if the outsourcing company you work with goes out of business you can make a quick and easy transition to another firm for these services.
Overall, when deciding whether or not to outsource certain parts of your company’s operations it is important to consider your own comfort level and how much control you would like to have over these operations. You should also determine how your company will react if you outsource and look at the competition to find out which company offers the best service for a better price. Finally, make sure you fully understand what will happen if the outsourced company goes under in order to avoid any negative consequences that could result from this change.
