Building a better business through outsourcing is an established global trend that will only grow bigger with time. Many small business owners waste time and resources on tasks that they aren't good at or tasks that add little to no value to the business, resulting in slower growth. The longer you put off identifying the tasks you should outsource, the more likely you are to delay the growth of your business.
Why and When You Should Outsource
According to Deloitte’s 2020 global outsourcing survey, these are the top 3 reasons why so many small businesses are choosing to outsource:
- To use outsourcing as a cost-cutting tool.
- To improve focus on their core business.
- To solve capacity issues.
With the opportunity to save time, save money, and tap into skills or expertise you or your employees may lack, exploring the tasks you should outsource can help you grow your business faster.
You’ll know it’s time to think about working with an outside contractor, virtual assistant, or service provider when you notice:
- certain tasks have become too time-consuming,
- there’s a more cost-effective way to approach certain processes,
- lesser obligations are draining resources from higher priority activities,
- you must consciously decide where to focus your time and energy,
- efficiency in certain areas is declining.
While pretty much any business process can be outsourced, that doesn’t necessarily mean that it should be.
By determining which tasks lend themselves to outside assistance - and which are best kept in-house - we’ll help you take the first steps toward building a better business through outsourcing.
Tasks You Should Outsource and Tasks You Should Keep In-House: How to Decide
It’s important to approach outsourcing strategically by mapping out where it makes sense, and where it would be better to keep tasks in-house.
A good way to start is by examining your company’s organizational structure. If you find one or two team members are handling multiple responsibilities, for example, it might be worth outsourcing some of their duties.
Here are some factors you should consider when deciding which tasks you should outsource:
- Is the task’s value in line with the time it takes to complete?
- Is it taking time away from more impactful activities?
- Does it often get put off because it’s stressful or tedious?
- Is it too small to warrant hiring even a part-time employee?
- Does it require learning new skills that are limited to that task?
- Does it contribute directly to your revenue?
You can pinpoint procedural gaps or inefficiencies that might benefit from outsourcing by analyzing a list of your employees, their roles, and the individual duties they perform.
Here is a summarized list of tasks you should outsource and list of tasks you should keep in-house.
5 Tasks Every Business Should Outsource
The most commonly outsourced business services are routine, repeatable, time-consuming, or non-strategic. Let’s take a look at 5 of the key tasks you should outsource, and why:
1. Administrative Tasks
With today’s technology capabilities and increased cloud usage, tasks like payment processing and data entry can easily be performed offsite. Doing away with full time, in-house support roles that require little in the way of specialized skills or knowledge can dramatically reduce your overhead costs.
2. Accounting Tasks
Tasks like bookkeeping, payroll, accounts payable, and accounts receivable are essential. However, they keep many businesses busy without contributing to their bottom line. Performing these tasks in-house may, in fact, be costing you more than outsourcing them would, considering:
- the time required to keep accounts organized and up to date,
- the stress attached to year-end and tax season catch-up, and
- the fees and interest associated with bookkeeping oversights
With automation making the sharing of data and documents easy and secure, outsourcing to an accounting firm or bookkeeping service can help you save money, improve productivity and provide peace of mind.
3. Marketing Tasks
Does your business take advantage of social media marketing, content marketing, graphic design, or blog posts? Not only can outsourcing tasks like these help you achieve a wider range of digital marketing goals, you’ll also gain an external perspective your staff can’t provide.
4. Technology & IT Tasks
System glitches and network breaches can quickly bring business to a standstill, impacting your business. Paying a web designer, web developer, or external IT expert to handle tasks like website maintenance and cybersecurity will often cost less in the long run than trying to manage them consistently yourself.
5. HR Tasks
Tasks like employee recruitment and benefits management frequently function better when outsourced. In addition to saving you time, dedicated HR service providers stay current on employment standards and legislation, preventing your business from mishandling complex situations like employment termination.
Tasks You Should Consider Keeping In-House
Although outsourcing is great way to cut costs and save time, there will always be certain business activities that you should avoid farming out. Your core business functions, for example, should never be outsourced.
As the underlying process, knowledge, or skill that sets you apart from your competitors, your core competencies are essential to your success and should be protected accordingly.
A company like Federal Express, for example, would never risk outsourcing the logistics that are integral to its success. So, you should determine what your company does really well, keep it in-house and focus your resources on maintaining and improving it.
Apart from your core competencies, here are some other areas you should weigh carefully before seeking outside help:
1. Employee Development
It usually makes more sense to leverage online learning and training courses to guide employee development than to outsource. After all, you know your team and where their future lies with your business better than anyone else.
2. Company Culture
The “character” of a business is always driven in part by the people who work there and the tone from the top. Since much of your company’s culture is destined to evolve organically, it’s not usually worth the cost (recruitment planning aside) of trying to control it externally beyond a certain point.
3. Customer Service
There are pros and cons when it comes to outsourcing your customer service function. Contracting out customer care can save time and money, but with clients so vital to your success, relying on an outside service to represent your brand means risking:
- uninformed representatives,
- unprofessional interactions, and
- unsatisfactory problem resolution
Remember, while outsourcing certain business tasks offer enormous benefits as a growth strategy, it’s important to do your due diligence. Security, accountability, and consistency should all be taken into account when vetting new service providers.
At Enkel, we do the bookkeeping and other accounting services for small to midsized businesses, saving them time and money, while providing accurate, compliant financial reporting. Focus on building your business and leave the bookkeeping to us.