Overview
Outsourcing is the driving force of today’s globalized economy.
Many, if not all, of the world’s largest corporations have begun to outsource key processes and operations, from manufacturing to customer service, in order to keep costs low and remain competitive. This, in turn, has helped turn emerging countries such as India and China into major economic powers, boosting global trade. Corporations have embraced outsourcing because it offers considerable financial and logistical advantages compared with doing everything in-house. It boosts productivity, reduces costs and allows for far greater flexibility and efficiency making it one of the two most significant commercial developments since the assembly line. The other being computerization.
Outsourcing and computerization had, for decades, run in parallel lines. Whilst both factories and offices enjoyed the benefits of computerization and automation, outsourcing was mostly confined to manufacturing. With the advent of the internet, however, this all began to change.
Today high speed internet and VOIP services such as Skype have fueled a boom in the virtual services industry. Outsourcing is no longer just for big companies, factories or call centers anymore, today, anybody can outsource pretty much anything!
Outsourcing for the Small Business.
No doubt you’ve heard the stories; college kids paying freelancers to help them research papers or the school kid who outsources his homework to the Philippines so he can play more Xbox. Then comes the pop-quiz and the kid gets in trouble, but chances are that kid’s a future businessman because, unlike his teacher who spends hours correcting homework every night, he’s already learned the work-smarter-not-harder ethos.
Building a successful company and elevating its growth requires that you focus on many tasks at once. Outsourcing is one way of reducing the burden of multi-tasking within your company. There are several elements in a business that can be outsourced. For example, you may wish to outsource your company website’s link building campaign – a tedious and time-consuming chore – so as to improve its search engine ranking. Or perhaps you want someone to monitor and reply to comments on review sites or manage your social networking profiles. After all there’s hardly enough hours in the day as it is, without the added distractions of Facebook and Twitter.
Outsourcing removes these chores and distractions and lets you concentrate running your business. It lets you focus on the big picture; building lasting relationships with your customers, finding new customers, fine-tuning your sales funnel and formulating new plans and marketing strategies. It’s all about outsourcing the tasks best suited to others allowing you the chance to concentrate on what you do best.
The Efficiency of Outsourcing
If a company is focused on reducing costs and streamlining without affecting the quality of customer service then outsourcing is the way to go. A business will generate more success by leveraging the power of outsourcing. It is more efficient and cost effective to outsource various tasks than to assign these tasks to your hourly paid staff. Factor other costs in such as overtime, utilities, office supplies and so on, and the cost gets higher still.
Outsourcing is sometimes given a bad rep because many equate the word outsourcing with layoffs. In many cases, however, outsourcing allows companies to remain competitive, particularly in this day and age, and so can often prevent far more layoffs than it causes.
It’s all about concentrating on your company’s core skills by maintaining a specialist workforce and going outside the company to find other specialist skills when and as you need them. This could be an ongoing process or for one-off projects. For example you run a car showroom and have a team of hotshot salespeople. These are your core specialist workers. Let’s say you may want to have a brochure designed for your company, do you hire a graphic designer as a salaried member of staff or do you find someone to outsource it to? Do you print it yourself or do you go to a professional printing company? The answer is obvious – you outsource it.
Many companies outsource their customer care department to offer a twenty four hour support service system to their customers. Other tasks which are regularly outsourced include clerical work such as data entry, market research or other marketing and advertising tasks. In fact, whatever the nature of the work might be you’ll find no shortage of virtual professionals willing to take on the work for a fraction of what it would cost to hire additional staff. What may take two staff members to achieve in a week, an outsourcing team may achieve in two days so outsourcing will not only save you money, it also saves you time.
Another method of efficiently outsourcing is the task of support. Your company may be assigned a one time project that you cannot refuse. This is while knowing your current team is tied up with other equally important responsibilities. In order to meet the project requirements, hire an outsourced support team. This will allow you to not only complete the project on time but also deliver excellent results, with the hope that one successful venture will lead to many more.
Outsourcing can be done locally or internationally with the convenience of advanced technology. There are talented and skillful foreign experts waiting to join a successful business venture. Outsourcing is particularly popular with entrepreneurs and startups, particularly tech startups, which complement their core workforce with versatile virtual assistants or recruit workers for specific tasks via websites such as Freelancer.com. This business model allows them to experience enormous financial growth in a short period of time without requiring a larger premises and an increase in staff and all the costs and bureaucracy that invariably goes with it.
Benefits of Outsourcing
Do you want to minimize your expenses and maximize your revenue? Do you want to gain access to expert skills and specialized services? All this and more can be achieved through the method of outsourcing. Outsourcing will help you concentrate more on the core of your business, while saving on time, money and infrastructure.
Benefit# 1 Increase in Productivity
Your company will see a big increase in productivity, profits, business performance and quality of business value. Outsourcing to a third party company or individual will see an increase in most aspects of your business.
Benefit# 2 Access Specialized Services
Outsourcing will help you gain access to skilled and specialized services. This is one benefit that has led several international companies to opt for outsourcing. The task you outsource may not be a core competency, but there are numerous outsourcing parties who may be specialized in that particular field. You are bound to receive proficient services. Outsourcing provides you the benefit of accessing expert services.
Benefit# 3 The Precious Gift of Time
Another benefit of outsourcing is that you will gain free time to focus on the core business of your company. You can outsource your non-core functions, while your employees’ time and skill can be put into better use. This will see a larger growth in the core business.
Though, as mentioned, the benefits of outsourcing are not merely confined to the world of business, whatever the task or chore may be, you can invariably outsource it and there’s plenty of people out there more than happy to sacrifice their weekends so you can enjoy yours! So if you find yourself up until all hours of the night burning the midnight oil perhaps it’s about time you considered outsourcing.
Benefit# 4 Time Zone Advantage
When outsourcing to certain countries you can benefit from the time zone advantage. If you have an urgent task to be completed in the next 24 hours, outsource to an individual or company in a time zone ahead of your zone. This enables for work to be completed faster and gives the business a competitive and efficient advantage. Nothing like starting the day fresh to find half the day’s work is already done.
Benefit# 5 Faster Deliveries
You can outsource a certain task which cannot be completed within the office setting in the required time frame. Outsourcing leads to quicker deliveries to customers. Generally, outsourcing partners work around the clock and provide quicker deliverables. So not only will your customers be pleased with the quick turnaround time, but it will save you time as well.
Benefit# 6 Improved Customer Satisfaction
With timely customer deliveries your company will gain confidence for maintaining a high quality service. Therefore outsourcing offers the added benefits of an increased customer base and increased customer loyalty.
Freeing Up Time with Outsourcing
Outsourcing may not be an obvious thing to do. After all, when you are in control of something it can be hard to let go. But this is what smart, successful people do. No matter how hard you work or how hard you study, there’s just no way you can do it all yourself.
So many entrepreneurs try to do a hundred things at once and end up burning themselves out. The business which they set up and had once been so passionate about begins to feel like a millstone around their neck. Their health suffers, their relationships suffer and, not surprisingly, their business suffers. It can be tough to let go sometimes and allow somebody else to take over, as a business owner no doubt you have your own set ways of doing things. Just remember, many of today’s biggest companies, like Microsoft and Apple, were started in garages by people just like you. Taking the risk to begin a business is but the first step, the next step is expansion and with outsourcing you can reduce the risk, as well as the costs, considerably.
Of course, for various reasons, you may be limited at the start by how much you can outsource. So start small! Begin on a smaller scale before you ramp it up. Outsourcing will give you free time to take on other aspects which may be just as vital to the growth of your business. The greatest politicians and business leaders are the ones who delegate their work and pass responsibility to others. As long as you keep your eye on the ball then there’s no reason whatsoever why the quality of the product or service should suffer, if anything the quality, much like your profits, should improve considerably.
For a radical look at outsourcing and extreme time management read here.
