Companies of all sizes resort to outsourcing when they don't have enough resources to tackle a task internally. Either they outsource some small part of their business or whole departments depending on the resources and knowledge they have already in their company. But how should you choose what to outsource, to whom, and how to proceed with this task?
Quick fix vs. right fix
You might have heard about those terms when it comes to fixing some bugs. Let's say you have software that allows people to send money online to their loved ones, or companies use it to pay remote employees. But at some point, you see that all transfers in USD don't work because something in your system isn't working correctly. And this is a core feature of your product. What should you do?
One way to resolve this is to implement a quick fix that temporarily solves the issue but might jeopardize other software functions. Maybe the reason for the issue was that you didn't have enough resources to support the number of USD transfers. You might decide now to take some resources allocated to other currencies away and dedicate them to the USD transfers. In this case, you might block the transfers in several other currencies that are not so commonly used at the expense of the USD ones. This quick fix will resolve your issue for a while, but it might cause you different ones in the meantime.
The right fix is the one that will solve your issue without the risk of causing new ones. So, you won't be looking for a solution that you can implement immediately, but you will take your time to find a way to allocate more resources to the USD transfers without taking them away from other currencies. Finding such a solution might take some time and more resources, but it will be the better choice. This is because you will implement a solution that, in the long run, will guarantee you that will prevent such issues from happening again.
Let's now imagine that your company doesn't have the resources to execute a specific task internally. It could be something minor, or it could be the work of a whole team. What should you do then? Many companies decide that outsourcing is the solution. But is it just a quick fix, or is it the right fix? Well, this highly depends on your organization, your needs, and how you will organize the outsourcing.
If you need something to be done quickly, you can tackle outsourcing as a quick fix because you need it immediately. You might do it just until you find the resources internally and you already have someone to do this task for you. Or you might decide to outsource continuously. Many companies, for example, outsource a big part or even their support team. When it comes to support, it is very beneficial to find a company that can help you provide this service in many different languages 24/7. To do this internally will require a lot of resources – many people to be hired and paid, equipment and space for them, investment in software and tools, etc. So, probably in such case, you will save yourself a lot of money and troubles, therefore this can be considered as the right fix.
However, if you need to outsource something that will cost you a lot or somehow complicate your business. For example, a sales team is not a good idea to outsource because first, you will have to share a lot of sensitive information, and second, you can't be sure how the outsourcing partner will handle it. They might not be as dedicated and passionate about this as a full-time employee in your company. You will also be sharing some clients' personal data with external people who might abuse it. If you don't have a big enough sales team, you might consider outsourcing some of their tasks for a short while, like a quick fix. However, development teams are easier to outsource, and usually, this saves you quite a lot of money. You will have to, of course, share your requirements in the beginning, but after that, the developers can work more or less automatically without a considerable risk for your business.
So, if outsourcing is just a quick fix you need to use while building your own team to perform the tasks you currently can or is the right and more permanent decision for you, it will depend on your needs. But whatever you decide and no matter how long you outsource, you have to choose your partner carefully. Let's look over some of the key considerations that you should keep in mind.
Key considerations
There are key factors to consider when you decide to outsource, as in any business decision. Keep reading to find out more about them.
Price and cost savings
Of course, this is one of the main aspects to consider when you decide to outsource anything, especially when it comes to technology solutions. We all know that the technical roles are the ones that are highly paid, and it is tough to find the right people. This is why many companies decide to outsource their dev teams to IT companies with more resources. But is this justified when it comes to pricing and saving some money?
Outsourcing is supposed to improve your business bottom lines by reducing some costs. If this is not happening, it will mean that you are actually spending more than you are saving through outsourcing. Most companies outsource very pricy services for them to do internally because it can save you money in terms of salaries, equipment, regular costs, etc.
But when you are comparing the pricing of different outsourcing technical solutions options, you should not always go with the lowest one. Yes, this will save you a lot of money, but it might mean that you are not getting the best quality. So, you should always compare the price and the quality you are getting and go for the one with the best ratio. The price will also depend on whether you want to outsource something for a short period or you will use the services for an extended period. Most outsourcing vendors will probably offer you some discounts if it is the latter.
Deadlines
The ability to meet deadlines is another important factor in choosing an outsourcing partner. Some companies are very flexible, and they can easily dedicate resources to projects that need them for some time. In this way, they can even meet shorter deadlines when needed or assist you in extreme circumstances. Others are not that flexible, and they hardly meet deadlines even when they are given way in advance. You need to establish all this with them from the beginning so you don't have potential issues in the future if a deadline is not respected.
Technologies
Checking with your outsourcing partner the tools and technologies they are going to use is very important. You need to make sure that those are compatible with your tools and technologies. Also, depending on your product or services, you need to make sure they are compliant with all regulations you have to follow.
Liabilities and trust
You should make sure that there is an explicit agreement regarding liabilities. In case something happens, you need to know who is taking responsibility for what. This will help you decide if your partner is trustworthy or not. The trust between a company and the outsourcing partner is crucial. If you are unsure about their work, you might lose more time checking what they did and if it is good quality. Of course, you will do that in the beginning, but if they prove that you can trust them, this will save you a lot of time and, most importantly, nerves.
Leadership and supervision
Who will lead the team is also something you should consider. Some companies would like to limit your contact with their employees and lead the team internally. So, you will have one central point of contact, and you will have less control.
Final words
Outsourcing can be the right decision for many companies. Sometimes is better to find a partner that can help you with tasks that you can't perform internally for some reason. But deciding on if you should outsource, what, and to who is not an easy task. It takes time to make the decision internally, then choosing the right partner and establishing a good relationship with them. Then depending on that and the key considerations, research for a partner and decide who to work with. After that, having a fruitful partnership will bring you many benefits and save you money, time, and effort.
