The Secret to Scaling or a FastTrack to Stress?! My Inside Take on Outsourcing v Hiring – #0031

No matter where you are on the entrepreneurial timeline “starting next year” or “5 years in”, if you want to scale you can’t do it alone. So, do you hire a team, or look to outsource? It’s an age old conundrum. One I’ve faced numerous times in my 13 years round the block. To help you make this decision, below are 3 advantages and 3 disadvantages of outsourcing from my real word experience.

 

Advantages of Outsourcing

  • Speed to implementation. You can have your new function, whether it be IT, Marketing, or Payroll up and running often within days. Hiring the right person, and training them can take months.
  • Greater experience, earlier in the process. When you outsource something, you should be hiring an expert consultancy or person. If you ask the right questions of their service, they should be teaching you HOW this function is run as well as performing it for me. Stay curious, and write down the process and platforms they are using. You might one day, want to bring this in house.
  • Time saver. In the early days of your business, or even in the early days of a new function within an established company, not only do you benefit from the speed to implementation as above, but the time it takes during your working day and working week to manage a function in house is vastly reduced. This frees up your time to do what you do best, which almost always is another part of your function altogether.

 

Disadvantages of Outsourcing

  • Culture fit. I truly believe to have a great business, you need a great culture. Although it takes far longer, and more money to recruit internally, you need to ask if you are missing the opportunity to add to your team, and grow your culture. More people that live and breathe the mission and message of your business begins to compound.
  • Lack of control. Unless your provider has a stable workforce, you may be given a different account manager every few months, they may even outsource this work themselves. If there are errors, how quickly can someone jump on and solve these for you. Far easier if you can lean over and chat with your marketing team face to face?
  • Slipping between the sheets. You need cast iron agreements in place with every outsourced partner, especially if they have a fairly steady turnover of their team. I’ve seen pretty vital functions before not get fulfilled as the provider assumed the client was picking it up, and vice versa.

Please Remember

You still have to manage outsourced partners, but in theory not as closely. Managing an employee and an outsourced partner is different, but this doesn’t give you the right to shout and scream when things aren’t done properly. The best results we have seen with outsourced partners over the years is when we extend things to them that we would to our own team members. Be a good client. Pay on time, suggest improvements, refer them to other clients, and don’t forget Christmas drinks invites. The closer they feel to your business, the more discretionary effort you will see from them.

 

Key Takeaway

I would always suggest outsourcing as much as possible in the early years. This will free you up to aggressively grow your business. If you can make £60-£100 an hour in value add to your company or more! Then don’t sit and do your tax return that someone can do for far less! As you grow and the cost eventually makes sense to bring the function back in house, recruit people to first oversee and shadow the outsource partner with a view to eventually taking the whole responsibility back in house.

 

Let’s win, together!

Si

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