As startups grow, it’s time to start thinking of creative ways to operate on a lean, efficient scale. Peter Drucker, a famous management consultant, once said, “Do what you do best and outsource the rest.” Simply put, you cannot have all the talent you need in-house during early stages. The cost of a salaried employee—not to mention the cost of finding them—can be staggering.
Furthermore, many startup founders are fearful of outsourcing any piece of the internal processes because they fear they’ll relinquish control, but this is more of a myth than anything (and you’ll read more about myths later). To compete amongst the hoard of startups popping up every year, you have to make quick, smart decisions. And chances are, you can’t do it all on your own. Here are a few reasons why you should consider outsourcing:
Saves You Time
As a startup founder, there are a myriad of things you’ve got to take care of. Chances are, you find your to-do list growing longer and longer each day, and each task seems more complex than the last. Outsourcing some of those tasks could save you a great deal of time. During the initial stages of your startup, you’ll face a couple hardships, and funds and short-staffed office environments are one of them. Trying to save time while trying to save money can feel like a double-edged sword, however, when you attempt to spearhead all the tasks yourself, you’ll quickly discover that you become a bottleneck for progress. When you remove yourself as a bottleneck, you’ll find that milestones are achieved much more fluidly.
You’ll benefit from a myriad of cost efficiency when you outsource. With the majority of startups failing within the first five years, you can’t afford to waste time trying to find people to fill the roles you need most. Hiring employees, handling the resources they consume, offering benefits, and training them are all key costs. And this isn’t considering the cost of making a bad hiring decision, which can cost about one-third of that employee’s overall salary. You could save plenty of time, money, and effort when you outsource to other professionals.
One of the biggest pros for outsourcing is that you can benefit greatly from tailored expertise. For example, let’s say you want to outsource your web hosting support to a team like IP Geeks. IP Geeks focuses exclusively on technical support solutions for web hosting companies, giving you tailored, niche services. On the other hand, if you wanted professional, vetted writers in a specific field, you might use the Scripted service, which authenticates writers and pairs them with agencies depending on their editorial needs. Search engine optimization, billing, and web design are other areas that you might consider outsourcing.
Many Myths Are False
Business tycoon Azim Premji once said, “The important thing about outsourcing or global sourcing is that it becomes a very powerful tool to leverage talent, improve productivity and reduce work cycles.” Yet, although many entrepreneurs, business consultants, and business owners have praised the benefits of outsourcing work—especially during early stages—some startup founders have general misconceptions about what outsourcing actually entails, and this prevents them from making a move.
As previously mentioned, you don’t lose control of your business. There are standard protocols and processes to ensure you retain all the rights to your work, and when you’re dealing with software and development projects, there are multiple safeguards in place to protect your code—especially if you’re working with a reputable development agency. From non-compete clauses to stellar security, your business will be treated with the utmost integrity when it’s being handled by the right people.
But there are other myths that keep people away, too. Those who care for their local economy may falsely believe that by giving a job or certain tasks to a foreign worker, for example, that they’re impacting jobs in their hometown. The truth is actually the opposite: when you outsource and grow, you may be able to offer additional benefits to your country. For example, the U.S. Department of Labor and the Heritage Foundation found that, over the past decade, there have been 8.11 million jobs added to the American economy as a direct result of outsourcing.
It’s also important to note that there’s different offshoring terminology. Not all “outsourcing” jobs leave the country; you can outsource tasks in your own backyard, too. This is also called onshoring.