Outsourcing is becoming increasingly common, with over 1.3 million businesses in the UK planning to increase spending on outsourced activities by 2027. There are several advantages of outsourcing, but to reap the rewards, you have to make the right decisions. In this guide, we’ll discuss essential steps to help your business capitalise on the diverse benefits of outsourcing.
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Identify your goals and priorities
The first step to take when exploring outsourcing opportunities is to identify your goals and outline your priorities. Outsourcing should help you improve and develop your business by solving problems, addressing pain points and providing superior experiences for your customers and employees. Be clear about what you want to achieve by outsourcing. Are you looking to free up time, gain access to specialist skills or tackle delays or inefficiencies in specific processes, for example? Once you know what your aims are, you can start drawing up a tailored strategy, which will help you set a realistic budget and decide what to outsource and who to hire.
Analyse in-house skills
One of the most advantageous aspects of outsourcing is gaining access to advanced, specialist or niche skills and services you don’t currently have in-house. Before you explore options, it’s beneficial to analyse the skills you have and highlight gaps. This will help you take full advantage of outsourcing to hit targets and achieve objectives. Outsourcing can offer a fast, simple and cost-effective alternative to hiring, especially in areas where there are significant national or global skills shortages. If you need specific skills, you may be up against multiple companies if you’re looking to hire top talent. Recruitment takes time and it also costs money. The average cost of a new hire in the UK is around £3,000. If you employ people, you also commit to a salary and benefits package. Using external agencies and third parties can help you save money while speeding up the process of working with skilled individuals.
Solve problems
Outsourcing can play a pivotal role in helping business owners solve problems. One common issue is a lack of time for core activities caused by employees juggling multiple jobs or being held back by inefficiencies, such as outdated or unreliable tech. Hiring third-party providers enables teams to focus on critical tasks while skilled, experienced individuals take care of other activities. IT support and managed IT services are among the most commonly outsourced tasks. Working with an IT company is a brilliant way to streamline IT operations and access expert advice and support. It can also help you optimise security, minimise the risk of downtime and ensure employees can work efficiently using appropriate technology and tools. Your IT agency can also make recommendations to upgrade and modernise systems and introduce software and tools to boost performance levels and save time, money and effort.
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Find the right outsourcing partners
Finding the right outsourcing partners is critical. If you choose to work with external agencies or freelancers, you want to ensure they’ll represent your brand positively, help you achieve your business goals and deliver a reliable, professional and effective service. It’s important to take your time to research companies, learn more about them and discuss ideas with representatives. Ask to see examples of work and portfolios, view facts and figures, read case studies and reviews and schedule meetings. Talk to teams, ask questions and find out more about the company, its values and the services it offers. Look for agencies that share your values and have a proven track record in your industry.
It’s beneficial to compare offers and meet with multiple representatives before you decide who to work with. Prioritising value for money over cost can help you identify the best deals. Red flags to avoid include offers that look too good to be true and agencies that have no contact information or reviews.
Develop your business
Developing a business is not easy and it often involves a significant financial investment. Outsourcing is an excellent way to explore new opportunities and push the company forward. Examples include using new technologies, tools and equipment to diversify or enhance products and services, accessing marketing skills and expertise to reach new audiences and boost lead creation and conversion rates and utilising external services to accelerate processes, such as bringing products to market or delivering items to customers.
When looking for ways to develop and improve your business by outsourcing activities, it’s beneficial to consider pain points and feedback from customers and employees and monitor your competitors. Outsourcing could not only help you avoid falling behind but it could enable you to stay ahead of the curve. Accessing state-of-the-art facilities or equipment is a great example. If you don’t have the space or funds to buy new equipment or trained staff to operate it, outsourcing allows you to capitalise on the benefits and gain a competitive advantage without breaking the bank.
Analyse data and track performance levels
Outsourcing can be transformative for companies, but it’s not a golden bullet. There are risks and pitfalls. Collecting and analysing data and tracking performance levels can help you monitor progress. Establish key metrics and analyse figures regularly. If you’re not getting the results you wanted or the agency you’ve hired isn’t delivering on promises, communicate with your point of contact. Explain your concerns clearly and outline what you expect moving forward. It’s beneficial to utilise flexible services, as they enable you to scale up and down and change your mind. If you’re not happy with a company’s performance, you can look for another provider if you’re not locked into a long-term contract. If you have serious issues, such as a lack of provision after payment, seek legal advice.
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Outsourcing offers a broad spectrum of benefits for businesses, but company owners have to make the right decisions to reap the rewards. Key steps to maximise the chances of success and reduce risks include identifying clear goals and objectives, analysing in-house skills to highlight gaps, outlining problems and pain points you want to address and finding the right outsourcing partners. It’s also beneficial to look for ways to use outsourcing to develop your business, analyse data and track progress once you’ve outsourced activities.