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Thought Leadership

When outsourcing should become the strategy…

\"Client\"Outsourcing is a feasible option for many jobs from HR and payroll, training, cleaning, accounting and manufacturing and to asset management and IT services. Deciding whether or not to outsource is not an easy call to make. It’s crucial for every business, from the small start-up to the large organisation. And, more importantly, which problems you are expecting to solve. Outsourcing can definitely be the tool that could make your business more productive and profitable, if you know when to take advantage of it. Think about these criteria when deciding which tasks to outsource:

  • The task isn\’t fundamental to generating income
  • The task is done routinely and wastes resources
  • The task is often overlooked or delegated because nobody wants to do it
  • The task can be done by someone with less/different skills
  • The task may be done inexpensively in-house, but burdens employees that are better used elsewhere
  • The task requires a specific or rare skill which regular employees don’t have

The strategic benefit of outsourcing is that you can use your resources for more profitable tasks. But once you have decided on outsourcing, how should one go about it?

Determine the requirements

Firstly make sure that the task you want to outsource is essential and beneficial for your business. Ask other executives and businesspersons to commend reputable outsourcing firms. You can get out a lot of information on businesses in casual conversations or even do some research on the internet on the topic. Once you have a shortlist of companies, arrange to meet with them to explain your needs. It is also a good idea to request recommendations from their current clients.



Select a well-matched company

Decide on a company that understands you and your needs. Make sure that you understand their terms and that they can accommodate yours. Set up a contract to ensure both parties agree to the terms and conditions. Allow for some flexibility and growth here, as the current arrangements may need to be adjusted in the future.

Clarify the expectations

As an external entity will be managing a task or even an entire division, clarifying your expectations and standards is of utmost importance. Put these in writing or include them in the contract, so that both parties are informed. Remember to also update these as and when this become necessary.

Communication builds a good relationship. Schedule regular meetings, share the expected work ethics and discuss the problems encountered along the way. By being aware of the goings on, you can avert possible difficulties and improve your operation.

Alternative arrangements

For some crucial tasks, it may be necessary to ensure that some kind of backup plan is in place, should the outsourcing company be unable to perform their tasks. An accounting or IT company in the outsourcing business should regularly supply their clients with backup data and also store these in separate, fireproof locations. Make sure to carry out regular checks to verify that backups are usable and restorable.

We believe that outsourcing is the way forward and that the key to outsourcing is a good relationship between the parties involved.

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