How to Build a Better Business with Outsourcing part 2

Making it Work
After you’ve found a provider, your work isn’t over yet. Even after you’ve checked references, “don’t be afraid to put a little extra time creating a specific contract that outlines exactly what performance is expected,” Resnick says. “Use incentives to motivate the outsourcer to focus on what is most important to you rather than their own preferences or their assumptions about what you want.”

Communicate your expectations and the steps included in the job clearly; never assume that contractors are thinking what you’re thinking. “When there is a problem [with the work], I am often the one to blame, as my instructions may not have been clear enough,” says Jeremy Belcher, owner of FoxyMelody.com, who has hired numerous contractors through eLance. “It is very important that the requirements and expectations are laid out in the beginning, and that nothing is left to assumption.”

Even when you clearly state your expectations, “there will be a learning curve on the provider’s side,” Belcher adds. “Hang in there. The provider will get better, and you will have the freedom to focus on more important tasks.”

Your final responsibility as a successful outsourcer is to step back, relinquish control, and allow your new team members to do the job you’ve hired them to do. “You need some measure of trust,” Resnick says. “If you are going to micromanage all of your outsourcing, the savings in management attention and time that is the whole point of outsourcing is lost.”

If you’re used to doing everything yourself, consider delegating the management of outsourcing relationships to another member of your management team, a move that may help you let go, according to Resnick.

“It’s less about logistics and entirely about mindset,” Walsh adds. “Many owners take pride in having the world on their shoulders and their entire organization buried in their mind. Knowing your business is critical, but keeping yourself indispensable is reckless and un-scalable. Realize that removing yourself from low-level operations is the smartest investment you can make in the long-term success of your business.”

 

Weighing the Costs vs. the Benefits

Counting the Cost
So what can you expect to pay a contractor for allowing you to rise above day-to-day tasks and build a better business? It depends on the type of work you’re buying, the skill level and location of your provider, and your own preferences.

For instance, SeatGeek’s Groetzinger says that through online hiring sites, you can find contractors in developing countries who will work for less than $1 per hour. While U.S.-based contractors will likely require higher fees, they may be lower in rural areas than in metropolitan cities where the cost of living is greater.

“‘You get what you pay for’ is true, wherever you go in the world,” Walsh says. “Always pay someone what they’re worth, regardless of location but accounting for and leveraging currency differences that often work in your favor. [Place] value [on] outcomes over hours. If you don’t get the outcome you need, it doesn’t matter how much time your contractor spent along the way. Consider distinct task-based agreements while you’re evaluating new providers, and transition to a fixed-cost retainer once you’re confident in their ability to consistently deliver.”

Facing the Challenges
While outsourcing can yield great advantages for a small company, it’s not without challenges. If you choose to work with offshore providers, language barriers and time zones can be difficult to deal with. However, Walsh says that focusing on making your own communications clear can help overcome confusion for those who are not native English speakers. And “time zones create more opportunity than inconvenience, as you can extend your productive hours by handing tasks over to someone during their workday,” Walsh says. “Assign a task at night, and awake to find it complete and waiting for you.”

Just as when you hire a new employee, there are security risks involved when handing tasks over to an outsourced provider. “The challenge is to outsource functionality securely, in a manner that does not put employee personal information or customer data at risk,” says Jonathan Gossels, president of SystemExperts, a security and compliance consulting firm.

If contractors are handling credit card data, Gossels recommends reviewing their Payment Card Industry Data Security Standard compliance statement; if they are handling health or benefits information, review their HIPAA compliance statement. For a general sense of the contractor’s security policy and practices, review their ISO 27002 compliance statement.

“The most important step a business owner can take to protect his data is to only provide the outsourced service provider with the absolute minimum data necessary for the provider to do its work,” Gossels says.

The Small Office Assistant’s Thomas discovered the importance of protecting client data when one of her contracted virtual assistants stole a client from Thomas for her own virtual assistant business. Now, rather than working directly with clients, Thomas’ contractors communicate with them anonymously through the company’s online system and Thomas herself serves as the sole client contact.

Reaping the Benefits
Although there are risks, outsourcing ultimately offers business owners great advantages. The process allows you to build a team of skilled professionals without adding the expense of full-time employees, and to avoid getting bogged down with tasks that can be completed without your attention, Sparks says. It’s an affordable, proven strategy for growing your business without letting it take over your life.

“Handing off work forces you to objectively, ruthlessly and systematically consider your activities and the steps taken to perform them,” Walsh says. “Defining a process flushes out inefficiency.”

When you outsource, you can focus your time, attention and resources on your company’s core competencies–and spend your time setting new goals and finding ways to achieve them.

 

Source: https://www.entrepreneur.com/