Outsourcing has long been a touchy subject for businesses in the United States. When manufacturing jobs began leaving U.S. shores for sites abroad, there was an outcry that it was going to destroy the middle class, lower the quality of the goods we purchase and strengthen our competitors.
According to WorkingAmerica.org, global ousourcing is a $500-billion industry. Best-selling author Dave Eggers’ latest novel, A Hologram For the King, focuses much of its attention on the issues that face countries when they outsource.
While jobs in industries like manufacturing can often be outsourced overseas for big reductions in price, you don’t have to look far to find outsourcing opportunities within your own country.
Whether you’re looking to outsource accounting responsibilities, HR or office management, you should know the outsourcing pros and cons. Here are just a few things to consider when outsourcing.
The Pros
– Gain Focus
If everyone in the office was responsible for cleaning the entire office each week, you would lose tons of productivity. You would have to split your time between dealing with customers, growing the business and making sure that the floors got vacuumed regularly. This would distract from the core focus of your business. Most businesses outsource the cleaning of their office to cleaning services because they can’t afford to lose focus. Whether it’s cleaning the office or managing the books, outsourcing allows your company to focus on the activities that will move the company forward.
– Lower Cost
Costs are typically lower when you outsource a job to a third party. You will not have to worry about providing health benefits, 401(k) or job training to that employee.
– Higher Quality
Companies that take on these outsourced jobs are usually specialized in that specific field. This means that the people they hire for those jobs will be specialists within that field and their quality of work will reflect that. Rather than having someone who is responsible for managing the books and acting as liaison between the office and warehouse, your accountant will be focused on one thing: accounting.
Cons
– Lost Control
It is always scary giving up control over some aspect of your business to a third party. This can be a well-founded concern. There can be difficulties communicating with the outsourcing company and this can lead to inefficiencies.
– Familiarity With the Business
If you hire from within your company, that employee will be much more familiar with the company’s business practices, culture and history. These are qualities that will be lacking in an outsourced hire.
If you understand the risks associated with outsourcing jobs, you will be able to anticipate problems before they arise. Weigh the pros and cons of outsourcing solutions and make a decision that makes the most sense for your company. If you feel that your company could use the increased focus on core activities that create value for customers, try outsourcing. But if familiarity with the company is something you value greatly, perhaps outsourcing is not the right solution for you.