Outsourcing is the act of using a third-party to take care of a specific part of your business operation. The need to outsource can come from the company not being able to do the task with in-house staffing. Other times outsourcing is in response to a short-term tasking that would be easier to just delegate to a third-party. Or maybe it is purely a cost-saving exercise. Whatever the reason, outsourcing has grown for businesses at all levels.
Outsourcing can be to a specialist external service provider, or a virtual assistant. Independent freelancers are commonly the choice of many companies looking for someone to outsource tasks to. In today’s world of being able to easily and cheaply outsourced so many tasks, it has meant that the days when a ‘temp’ would work on-site to complete a project have changed considerably.
The main differences when using an outsourcer involve using people or services that are located in other parts of the world as opposed to other parts of the same community. While this presents several challenges, the concept remains the same.
Where To Find Outsourcers
There are many places to find outsourcers. However, the best places we have found are:
Regardless of where you find your outsourcer, often agencies act as a middleman, taking a huge portion of the payment. For this reason, it can be much more affordable to hire an outsourcer directly without going through an agency.
The Advantages of Outsourcing
We have included four main advantages for you and your business should you choose to outsource. They include:
1. Efficiency and Expertise
When outsourcing, often an expert in a specific field is a specific requirement. In addition to having the skills and tools for the job, these experts are often better equipped for the tasks that they are given than staff within the business. Plus, these off-site workers can produce faster and higher quality results.
2. Core Process Building
For growing businesses, outsourcing supporting processes can be a smart business move. What this does is that it allows for better concentration and focus on the development of core processes. By having support tasks outsourced, the growth of the company is not affected by the downtime required to upgrade support services.
3. Risk Management
Risk analysis is a major factor in determining the outcome of any action within a business. By outsourcing parts of the process, it puts responsibility for task completion on the outsourced vendor and removes it from the business doing the outsourcing. The end result is a better outcome than could have been achieved in-house.
4. Cost Cutting
By outsourcing, there is no need to recruit and train someone in-house for the task. This can be a crucial saving depending on the size of the business and the amount of work being shifted to a third-party. Regardless, any kind of saving is important to the bottom line and that is what makes outsourcing a highly desirable option for many businesses.
The Disadvantages of Outsourcing
There are as many disadvantages as there are advantages to outsourcing. Many risks can be minimized or mitigated, but care has to be taken. They include the following:
1. Confidentiality Risks
When outsourcing to a third-party involves tasks related to payroll or HR services, there is a risk involved. The risk comes from exposing confidential company and employee information. If this is a concern of yours, either specific measures have to be taken to ensure confidentiality, or possibly outsourcing these specific tasks is not ideal for your company.
2. Task Completion Timing
One of the problems with outsourcing is having tasks completed on time or within a specific time frame. If several tasks are being outsourced to more than one third-party this can become a huge issue. Plus, sometimes the quality of the product can suffer as well. If these matters are of concern to you, keeping these tasks in-house can give you more control over the results.
3. Extra Fees
Because cost saving is the main attraction to outsourcing for many businesses, one of the problems that can arise from that comes in the form of hidden costs. Before signing a contract to commit to a third-party, be sure to examine it carefully in case of an extra fee.
4. Not Customer Focused
Because outsourcing is task-related, the results may not particularly align with the customer focus of your business. Product quality can be an issue. That’s because the third-party is not part of the in-house office culture of your company. This can create a problem over time and it may be a good reason to keep some tasks in-house for staff that understand your company focus so that they can deal with instead.
5. No Recourse
Even though you may have a contract with your outsourcer if things do go wrong, enforcing that contract may be difficult, especially if they are located overseas where the laws may be very different. It is always good to have a contract, but this does not guarantee that things won’t go wrong.
The Tools That Help With Outsourcing
There are several online tools that allow you to provide information to the outsourced third-party in order to complete the tasks trusted in their care. They include tools for the following categories which we will look at:
- Project and Task Management
- Document Sharing
- Password Sharing
- Time Tracking
- Making Payment
Below we will look at each of the tools we have used and recommend for each category. You don’t have to use all tools in each category, but you will probably want to use at least 1 (maybe more) from each:
When you outsource a task to someone not physically working inside your business you still need to be able to communicate with them. While emails can be one source of contact, for more immediate communication live video and texting services are often best. Options include:
Project and Task Management
An effective way to schedule, monitor, and share tasks remotely with a third-party is with one of many online tools designed just for this purpose. You can assign multiple tasks and set deadlines with project and task management tools including:
Whether you are just sharing documents and files with one person you’ve outsourced tasks to, or require several people to connect for collaboration purposes, there are many tools for this. They include:
For the management of password sharing between you and your outsourced third-party, there are a number of programs available to use. By password protecting files and documents being transferred to an off-site worker, you reduce the risk of hackers getting their hands on sensitive company information. Programs include:
In addition to allowing you to track the time being spent on outsourced projects, productivity can be increased through the use of time tracking programs. Some have billing software built-in to allow for more accurate billing by time options. Many also save screen captures of the outsourcer so you can make sure they are working when they say they work.
There are many time tracking tools and they include:
Sooner or later you are going to be faced with having to use a payment portal of some kind to reimburse your outsourcer for their work. E-transfers are reliable, but depending on the bank, the location of the third-party, and service fees this may not be the best option.
As noted above, there are several different online tools available for use when outsourcing tasks. To find them just search with terms related to what you are looking for such as “online time tracking tools” or “online communication tools” for additional options.
Of course, there are many other tools that do the same or similar tasks. These are some of our preferred tools; you may already have something that does a similar job that works well. Most of these have free options that will be sufficient for many small business requirements.
Final Thoughts On Outsourcing Tools
Outsourcing has allowed many businesses the opportunity to become more productive and minimise costs. With expert off-site workers available, the business can match the right outsourcer to the task and see quality results. However, there are some risks, so care has to be taken.
Being able to manage the tasks and connect with outsourcers can be made easier by using the various online tools available, some of which are mentioned above. Many have free options. They can also assist with managing your day-to-day work, as well as in-house staff.
So if you are not currently using these tools, make sure you check them out so you can effectively control and monitor work being done.