Outsourcing used to be something that was only accessible to larger companies that needed more hands than they had in-house. However, now it’s a common practice for companies of all sizes to outsource to add more value to their organisation.
But what is outsourcing exactly, and what are some common outsourcing mistakes that should be avoided? In this blog, we delve into some of the most common outsourcing mistakes business owners make and how you can avoid them to ensure you get the most from resource outsourcing.
What is Outsourcing?
Simply put, outsourcing is when a business seeks to employ another company or individual to complete a project or task which already exists. This can be done to cover work during busy periods, to bring experts in on certain projects, or to save on employing permanent members of staff.
Here are 4 common outsourcing mistakes commonly made with advice on how you can avoid them:
1. Not doing thorough research
A lack of research is a common issue when it comes to outsourcing. Anyone can enter a query into a search engine and pick the top option, but that might not be the right choice for you. There are many legitimate-seeming outsourcing companies which might not have the expertise they promise, which can lead to inferior work and hidden costs.
To avoid this, ask trusted professionals in your industry for recommendations and do thorough research on any company you’re considering.
2. Prioritising costs over quality
There are some companies that provide outsourcing services at low prices. This is extremely tempting, especially for smaller businesses that have less financial freedom. However, prioritising cost over quality is a common error – and could cause you to pay more to have errors fixed.
Rather than choosing the lowest price, be realistic about your budget and outsource only when you are able to pay for exactly what you need.
3. Outsourcing incorrectly
Not every job is suitable for outsourcing. Roles with a heavy focus on customer relationships, for example, benefit from the steady presence of a permanent staff member. However, there are instances where skills and experience are transferable. Project delivery for example is built on a number of practices that can be tailored and adapted to any project.
Organisations have a tendency to outsource more menial tasks like data processing and admin, however there is a strong argument for bringing in a team of highly skilled experts for specific deliverables and to drive a specific change, especially where there may be an existing capability gap in you organisation. This approach has an added benefit as outsourced teams often have knowledge transfer and upskilling your existing staff as defined outputs of work delivered for you.
When you bring outsourcers in on a project, you sometimes might not think of them as ‘real members of the team” and just a ‘cost’, however as an employer there are considerations you need to address when you engage short term resource such as consultants. Recent HMRC legislation such as IR35 means that you need to consider your wider obligations when outsourcing.
Working with expert teams like Reed Professional Services helps you ensure that you remain compliant, helping you manage your resource and find a model for you that is cost effective and compliant. Our team of compliance experts help you navigate the changes and also take responsibility for the deliverables aligned to any resource we place on your projects.
RPS are an experienced and expert team, with a wealth of programme and technical experience that are committed to your goals and outcomes. From project inception through to delivery, we are here to ensure that your programmes and projects are supported by the right people using best practice and a problem-solving approach to deliver faster time-to-value.
If you would like further support to help your business thrive, then get in touch with our team here. We can offer both project and programme management solutions, and with our extensive talent pool, we can source the right team members for you.