Outsourcing is an idea that has revolutionised the way entrepreneurs plan, structure and run an enterprise, and it’s increasing popularity can be attributed to its capacity to help entrepreneurs scale and deploy a business idea faster and operate more efficiently.
Embracing the idea of outsourcing, entrepreneurs can focus on developing solutions and expertise in core competencies where they add real value to their market, either naturally through their access to unique or scarce resources, or intelligently though their ingenuity.
They can then outsource the more mundane and tedious tasks that, although critical to the day to day operations of their business, aren’t the primary reason for their existence.
Separating core competencies from critical but mundane tasks enables businesses to leverage the specialist knowledge, management expertise, staff and/or infrastructure of dedicated professionals; making it easier for them to deploy their unique products and services quickly and efficiently, and thereby scale or expand faster.
Offshore & Onshore Outsourcing
Outsourcing in the 21st century can be broadly categorised as offshore and onshore. Onshore outsourcing is the more traditional area where specific services are provided by local 3rd party contractors, however the evolution of the internet and telecommunications networks has made offshore outsourcing commonplace today.
An example of onshore outsourcing is outsourcing something mundane but essential like cleaning. A real-world example of this is a local business outsourcing their cleaning to a local company that can supply consistent, well trained and managed cleaners that take care of cleaning, maintenance and rubbish removal in all of their outlets, better than they could if they tried to manage those services themselves. An example of a successful business like this is Smart Cleaning Solutions, a Melbourne based commercial cleaning company that has doubled the size of their business every year for seven consecutive years, by aggressively targeting fast growing companies that need consistent cleaning across multiple outlets, and vertical niches where consistently high cleaning standards and hygiene are critical to business success. Businesses that need this kind of service can check out this recent article about how to choose the right cleaning company for your business.
Offshore outsourcing, sometimes referred to as offshoring, is outsourcing tasks that can be done by someone overseas in a country where the cost of living is lower than in the country in which the host company operates. This means tasks can be done cheaper, creating a competitive advantage to the company accessing the outsourced services by enabling them to reduce costs or increase their margins. This means they can then undercut companies paying more for the same service locally, or through increased margins, outspend them with their marketing.
Much offshore outsourcing work is commonly called business process outsourcing, and examples of this kind of work include outsourcing helpdesks, outbound sales teams and administrative tasks like bookkeeping.
Another big area of offshore outsourcing is IT, especially tasks like app development, websites development and writing code. Also associated services like blog writing, video production and graphic design are increasingly being done overseas.
Professional Services Outsourcing
Professional services outsourcing is the most traditional area of outsourcing and is rarely delivered in house. Examples of professional outsourcing are areas like legal services, engineering, environmental consulting, accounting and specialist business consulting services like business coaching….
Outsourcing is continuing to expand and grow. The advantages of fast scalable growth and increased business efficiency make outsourcing a must for businesses that need to stay competitive in an increasingly global economy.