Overworked and understaffed? Time to outsource

If you’d rather spend more time developing your business and less time tied up in operational duties, outsourcing can be a good solution. Not only does it allow you to concentrate on your strengths, it lets you hire qualified people to do what they do best.

The popularity of outsourcing has made it a $31 billion industry in Australia, a figure forecast to grow at an annual rate of 2.2 per cent, data from research firm IBISWorld shows. Globally, the outsourcing industry is worth $US88.9 billion – up from $US45.6 billion in 2000, number-crunching portal Statista reports.

What to outsource

A quick scan of sites such as Airtasker will confirm that there is very little you can’t pay someone to do for you. Bookkeeping, social media management and marketing are just some of the most popular tasks ideal for small business owners to outsource.

Somewhat unsurprisingly, accountancy services are the most commonly outsourced task for micro businesses, followed closely by web design and graphic design, according to a 2015-16 survey (PDF 889kB) by micro-business community Flying Solo.

Where to look

Take your first steps towards outsourcing by talking to your contacts. Find out which jobs they outsourced, how they discovered the right professionals, and whether they would recommend the process.

“Start with your network,” says career coach Rebecca Fraser of Rebecca Fraser Consulting. “Talk to other small business owners and get their feedback.”

Fraser recommends preparing a list of questions before entering into an outsourcing agreement to ensure you get what you pay for. “You’ve got to find someone who understands the Australian market, so be careful when selecting and treat it like a job interview,” she says. “None of it is regulated, so you have to do a lot of research.”

Ask your contacts how much they paid for an outsourcing service, how they briefed them, what timelines they set, if they were happy with the service and what they would have done differently.

Try an online marketplace

There are plenty of online marketplaces for outsourcing including Freelancer, Taskarmy, and Upwork. Most allow you to see examples of work and enquire about rates before agreeing to any projects. There may be room for negotiation on price and the scope of work, but like any transaction you need to offer appropriate pay for quality work.

Expect both individual freelancers and companies that specialise in outsourcing to bid for your projects on these sites. People from Australia are just as likely to offer to work for you as people from other countries.

Think global

India is the world leader in attracting outsourced IT work. Malaysia and the Philippines are also known for call-centre workers and virtual assistants.

In its Global Services Location Index (PDF 1.1MB), management consulting firm ATKearney ranks countries that attract outsourcing by analysing factors such as affordability, people skills and availability, as well as business environment. The firm found India to be the top location, followed by China, Malaysia, Mexico and Indonesia.

Cost-effective creativity

Affordability is arguably the main reason business operators opt to outsource. It is usually a cheap and fast way to get time-consuming and expensive tasks done, or to achieve one-off or irregular tasks for which you don’t have the skills.

Take, for example, Australian start-up marketplace 99designs, which specialises in logos, graphics and website design. More than 1.2 million freelance designers use the site to find work, which means every project attracts a variety of designs from which customers can choose. Logo pricing generally starts at $399 for “good designers” and can rise to $1599 for “exceptional designers”.

Managing risk

Outsourcing comes with risks that can affect business budgets, project outcomes, deadlines and key performance indicators. If things go wrong, the quality of your product or service may be affected, alienating customers. Insufficient planning and miscommunication are potential hazards in just about every outsourcing project. Make sure that you seek legal advice before embarking on an outsourcing project.

A study by consulting firm Protiviti found a variety of ways to help manage outsourcing risks, including analysing and resolving performance issues, making joint crisis-prevention plans at the outset and issuing clear and uniform communications.

Document security is another concern when outsourcing. To help limit your exposure, use file-sharing systems such as DropBox and Google Drive and password management apps such as LastPass. If you’re still in the early stages of building trust with your outsourcing staff, you may want to consider restricting access to documents so they cannot edit, cut, export or delete files. Confidentiality agreements can also help protect your company’s interests.

When you opt to outsource, it pays to research your options thoroughly to make sure you’ll save time and money in the long run. With experience you may find outsourcing is not only time and cost effective, it also improves the quality of your company’s offering.

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