G. Connie Runia, The Daily Record Newswire
Almost any business function can be outsourced. You may have identified marketing, payment processing, tech support, accounting, collections, social media, HR, or sales. The function you have chosen to outsource is not important. What is important is that you choose the correct resource.
What should you look for in an outsource partner?
1. Expertise. As in hiring, look for expertise that exceeds your talent pool. Look for superior and seasoned experience and knowledge. This is not the time to train your outsource in the industry you want them to know more than you.
2. Capacity. Your outsource choice should have the resources in place or be able to ramp up quickly in order to hit the ground running. They should bring effectively, efficient onboarding.
3. Concern about your customers and reputation. An outsource reflects you to your customers, vendors, business associates and employees. An outsource must treat your customers as you would or better. Request and listen to references. Seek feedback from any interactions with an outsource.
4. Transparency. The function performed by the outsource should be completely visible, as it would be if it were an in-house function. Have the same expectation. A good outsource will not shy away from the difficult conversations, nor hesitate to suggest changes or corrections. Transparency means that information you need is anticipated and provided, including the controls necessary to protect you, your customers and the outsource. It should be a true business partner relationship.
5. Results. Results doesn't mean that you are replacing the function you have outsourced with the full time job of managing the outsource. On the other hand, don't go to "out of sight, out of mind." Consider your reasons for outsourcing. Internal resources should be freed up and goals achieved.
When should you outsource?
Almost any business function can be outsourced. Given your business goals, what are your strategic priorities? Where are you going to invest resources and how are you going to apply those resources? As for risk, what is your level of comfort with both internal and external relationships? What level of management is required to control the risk? The answers vary widely, but here are some general principles that apply across all functions.
Generally, you should consider outsourcing when you need:
1. Increased capacity. You have staff and management in place but simply need more. This could be the consequence of rapid growth, expansion into new markets or unanticipated staff turnover. If you are looking for permanent hires, outsourcing can give you the time you need to find staff and bring them up to speed.
2. A task performed, or consolidation of a task performed in multiple locations. As a business grows, the tasks grow as well. The task may be newly identified or may have previously been performed in part or performed in several branch offices. The task itself is managed internally. It has reached a stage where it needs more focused attention, or the business would benefit from consolidating the task. An example could be customer support.
3. An entire function managed and performed. There is no internal management of the function. You do not want to develop the expertise needed to bring this function in-house at this time. This is often referred to as "managed services" and is prevalent with IT and HR functions. This could also be adding at the executive/leadership level, for example, a CFO.
4. A scalable resource to accomplish a project that is not part of your long-term operational plan. This could be at any level of your company. A project may be a one-time effort, such as a building project, or fund-raising campaign. The project could be one where the initial development and setup are intensive but once in place, the project will be self-maintaining. An example of this would be a "green project" where a business makes a commitment to going paperless or saving resources.
Outsourced business functions play an important role in the local economy. The Idaho Department of Commerce reports that back office/shared services are among the key Idaho industries, and this segment has a heavy outsource component that includes customer service, technical support, accounting, and human resources.
Outsourcing may be the right move for you. Know that there are many highly qualified and talented experts located in Idaho who are ready, willing and able to position you for growth.
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G. Connie Runia is an attorney licensed in Oregon and Idaho and in practice with On Track Legal Services PLLC. .
Published: Thu, Aug 20, 2015
