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Questions to Ask Yourself Before Outsourcing or Hiring

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Questions to Ask Yourself Before Outsourcing or Hiring

Of course, entrepreneurs know that managing your team correctly is a must for business success, but they don’t always have a clear idea of how they should structure their team to make things work.

If your business is in the startup phase, you will try to do as much as possible on your own. This approach may work temporarily, but is it the best way to build the foundations of your business for sustained growth?

Sooner or later, you will need to delegate responsibility to other people. But, when you finally decide that, you’ll be faced with a question: Is it better to hire or outsource the bulk of the work to an agency or freelancer? By asking yourself the following questions, you’ll hopefully come to the right decision.

#1 What Expertise Are You Currently Missing?

When you’re a small business owner or a startup, the things you might need can cover everything from communicating to marketing to inventory management.

But most teams don’t have the personnel to accomplish all of these tasks. And the natural question would be: how can your company find such expertise? Can you see it more accessible by hiring an employee or outsourcing tasks to other agencies?

This can be tricky: what kind of expertise are you missing? Can it all be solved by hiring one or two people? How is the local skill pool you’re drawing from? You need to answer all of these before you make your decision.

But, as a rule of thumb, outsourcing to a global agency makes sense if you are looking for particular skills that you probably can’t find locally. If you need intricate tasks that can’t get done by hiring an additional one or two employees, trusting the study with an outsourcing agency is also a good idea. Increasing your payroll drastically during the initial phases of your business isn’t a good idea.

#2 Hiring and Outsourcing: What Different Arrangements Do You Have Access to?

When you hear ‘hire’ and ‘outsource,’ you likely envision tangible things. But both of these concepts are flexible, and there are many arrangements you can use to maximize benefits to your company.

If you’re considering hiring a full-time person, you have to choose between hiring a junior or senior professional. Juniors are not always able to approach things strategically. Those with more experience, on the other hand, maybe more reluctant to perform specific administrative (menial) tasks.

The other option would be to outsource. You can use an agency or work with freelancers. You can choose from various flexible arrangements when delegating your tasks. If you decide to outsource all of these activities, understand that outsourcing does not mean totally “abdicating” your company’s functions to an agency or freelancer. Your involvement is necessary.

#3 Taking Geography into Account: Can You Afford to Hire the Talents You Need?

In many parts of the Western world, the shortage of skilled labor has started affecting all sectors, incredibly tech. As a result, small businesses sometimes find it challenging to compete with other companies for the best talents.

When you need a specialist, due to the much larger, international pool of candidates, you can probably find more skilled specialists for cheaper.

In addition, these specialists often use expensive tools that you don’t have access to. Buying all these tools for your company would be prohibitive, but a software development outsourcing company can spread the cost over their clients, making their services quite affordable.

#4 Which One Costs Less?

On the surface, hiring is cheaper. At least on paper.

However, there are hidden costs associated with increasing your payroll, such as integrating the new employee and relatively poor productivity during the first few months. Also, consider the time spent on coaching this new person. This is another form of cost. When you outsource the work to an agency, they take care of the supervision of the staff.

Like it or not, hiring new staff takes time. Even if you find the right person tomorrow morning, it will probably take several months before that person becomes fully integrated into your company. This “opportunity cost” can be considerable if your business is overgrowing.

That said, hiring an employee can be considered a long-term investment. It all depends on what stage of growth your company is in. If you spend years with talented employees, they can become irreplaceable.

#5 Do We Have to Choose Between Outsourcing and Hiring?

These days, few companies manage to do everything without using an agency or freelancers.

Maybe there’s a false dichotomy between hiring and outsourcing, and perhaps the better question would be: what part of your tasks should you outsource? Next, ask yourself if this is a temporary or permanent situation? In other words, how do you see the future of your company? Do you see an end with many employees, or do you prefer to stay lean?

When entrepreneurs are told that they should not only hire but outsource, they get a little worried. They wonder how they’re going to afford it all. But many startups with very tight budgets have managed to achieve amazing things with outsourcing, and all-star employees have made many companies successful. Both approaches are feasible, and you shouldn’t count either of them out.

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