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Nash Riggins is a Staff Writer for Small Business Trends and an American journalist based in central Scotland. Nash covers industry studies, emerging trends and general business developments. His writing background includes The Huffington Post, World Finance and GuruFocus. His website is NashRiggins.com.
The key is finding the right people to outsource your business to. This person should be an expert at what he or she doea and the person should have enough integrity to not abuse the control that they have over your business.
Thanks for a thorough list. I’d be lost without outsourcing for two reasons.
Number one used to be that I just didn’t have enough time to do everything that needed doing, but I’ve gotten more efficient at identifying what really doesn’t need doing after all. So now number one is that I can outsource what I’d rather not be doing, due to either lack of competence or lack of interest. Sometimes those necessary but unpleasant (to me) tasks take me away from doing what I actually went into business to do, and other times I’d just rather admit I hate them and let someone else have the aggravation.
Number two, everybody who hires me is outsourcing, so I like that. 🙂
Couldn’t agree more. Probably the biggest advantage is the number 5. You Can Reduce Costs. Also as Aira Bongco mentioned, the key is finding the right people to outsource your business to so that quality is not compromised. You can balance between these if you hire someone qualitifed who lives in a place where average labor cost is lower like India. In this case recommendation from someone, maybe a friend, who has been benefitted from him.
However, when it comes to outsourcing, I always companies instead of individual freelance service providers. Freelancers often lack commitment and more often skill which often lead to quality compromise, even time waste, and project failure. On the contrary, companies are committed to providing best services, they also come with two options, you may choose a virtual assistant from them or assign the company project as a whole. Company always try to maintain quality at its best so that their reputation isn’t damaged.
When I needed to get my site’s articles written, I hired a virtual assistant from Staff India following suggestion from a friend who also got his writing done by them. I saw how much those companies value reputation and so maintain quality service.
Again, thanks to the writer, really helpful article. I wish I knew these facts before.
Outsourcing has helped businesses focus on their core functions while letting professional outsourcing companies that provide BPO services to take over the everyday tasks. Tasks as important as customer service and customer retention are being handled by third party companies that are giving excellent results and flexibility to your business.
Really good article! I would like to add some more advantages of outsourcing, with some detailed listing:
1. Focused strategy – sometimes your development team may have problems managing lots of projects. By picking outsource software development you won’t have to worry about this, as outsource team will focus entirely on the project you provide.
2. Time savings – outsource software development process is usually much faster than in house one.
3. Bringing in fresh perspective – as simple as it is, if you add additional members to your team, you will surely hear new perspectives.
Nowadays there’re many software outsourcing company in Vietnam like PowerGate,..and I think Vietnam has some advantages to develop software outsourcing such as profession skill, labour, environment,…
Biggest advantage of outsourcing is cost cutting and getting service of expert at very competitive rate.
Hiring and selecting employee is time consuming and costly. Moreover, you need to have space and facilities for new employees.
Outsourcing is not limited to start up or small businesses. Nowadays, well established companies also prefer outsourcing and reducing the cost.
With some safety steps, outstanding is the best option as per me.
My uncle owns a few properties which he rents out so that he can get an extra income but he told me that he is tired of dealing with people that don’t want to pay rent. I found it interesting when you said that one of the top reasons small businesses tend to outsource work is because it will get done quicker. I will definitely recommend him to think about outsourcing a property management company so that they can take care of his tasks.
The key is finding the right people to outsource your business. This person should be an expert at what he or she does and the person should have enough integrity to not abuse the control that they have over your business!
Great article. Yes, outsourcing is mainly done to reduce cost. It helps companies to save time and money allowing them to focus on the core aspects of their business. With this, business owners and their onshore staff can concentrate with their main tasks like networking or driving profits. Companies have to just analyze and carefully choose their provider to minimize (or eliminate) the risks of outsourcing to avoid costly mistakes.
In my opinion, there are some disadvantages and the ways to overcome as below:
1. Difficult to control the working process
When business owners and software outsourcing teams are in two different places, there will certainly arise problems about the process of finishing the work and the results achieved in each set out stage. On the other hand, you probably won’t have complete control over how those tasks are performed, but just be monitored.
If you have chosen a reliable service provider, take it easy checking and tracking each work item, do not put too much emphasis on controlling every detail, steps to steps. The experts themselves would always know how to handle the job.
2. Time zone differences
Geographic differences will lead to differences in time zones. For instance, if an enterprise is based in the Americas but works with a software outsourcing team in Asia, the evening is the time for the enterprise to go to bed, and it will most likely fall into the team working time or vice versa.
Whatever the contradictory working hours, we will certainly find the appropriate time to discuss. Or simply, online communication by using the messaging application is also a good idea. On the other hand, you can also use large time zone differences to your advantage. For example, you might send a software outsourcing team a task at the end of your workday. While you are sleeping, the team is still working hard, and you will definitely get results by the beginning of the next working day.
3. Difficult to grasp each other’s styles & ideas
“Conveying ideas,” sounds easy, but if the two sides do not fully understand each other, then the damage is caused. Every business owner, every organization, every individual has a unique color; from work style to arrangement idea. Sometimes, with the same project and destination, the software outsourcing team will certainly have a completely different perspective from the business owner. Because they see things from the lens of technological expertise, while business owners have their holistic point of view, taking into account the loss – profit and many other factors.
Surely 2 parties will have to prepare a unified meeting, and discuss each item, details in the plan table. Software outsourcing teams and businesses will have the opportunity to listen to understand each other better, grasp ideas and needs easily.
Disadvantages of Software Outsourcing & How to overcome
4. Security risks
When you decide to transfer your internal business information to a partner, make sure that the partner will keep the information completely confidential. In this era of Big Data, you must be very careful when using customer data.
In order to avoid such risks and ensure security standards, the 2 parties should sign NDAs (Non-disclosure agreement) and security protocols before starting the project. Furthermore, the business owner should also consider a well written-contract covering all the aspects of intellectual property hand-over before software outsourcing takes place.
5. Language barriers
Nowadays, English has become popular in most countries. Thus, if the communication is simple or not too deep into the professional aspect, then the citizens from different countries can easily express ideas with each other. However, if you are delegating teleworking via email or phone, important instructions are often missing, lost, or difficult to keep in full meaning when using online translation tools. That can cost you time, money and serious trouble. You can convey your edits or ideas through particular photos or presentation slides for illustration.
Encourage the software outsourcing team to ask more questions. In the process of working, there will certainly be many problems, and of course, no one can understand the brand as much as the representative from that business. Once you have a more detailed view of your needs, the software outsourcing team will definitely complete the project well and deliver a great result.
6. Your project will probably not be focused or cared for
Most newly established software outsourcing companies or small scaled software companies will certainly have many other projects for many different businesses. Each project has a unique color with specific requirements. Your project may be delayed, completed later than the deadline due to the shortage of human resources from the software outsourcing team, or may be completed very soon because they only “get it done”, then quickly move on to another project.
If it’s a project that ends early, don’t worry too much. Because “quality” will be the most objective measure to evaluate the professionalism of the software outsourcing team that you have chosen. In particular, if your technology service provider is in a different country – with a different time zone, you should also publish to control the project progress or synchronize information through daily report, communication and exchanging with each other equally also bring about significant results.
It caught my attention when you said that outsourcing tasks will give us peace of mind that things are being handled efficiently. My brother mentioned that he wants to improve the storage and fulfillment processes for the modern retail business he started last year. I’ll give him a call to see if he knows why outsourcing his warehousing services would be beneficial!
That’s a good point.
ODS Group sometimes has to outsource software development, some companies like Saigon Technology, FPT Software Or Bairedev are really good.
Wonderful, this information explains a lot plus this is what really is happening in the outsourcing industry. However, some unavoidable spectacles will be happening during the operation that means everybody should be prepared for that especially for the newcomers or fresh employees who are unaware of what really outsourcing does and don’ts. I would recommend this article it helps others understand the advantage and disadvantages of outsourcing.
Thanks for a great article , there are some thoughts from my point. Outsourcing is maybe the answer to develop your company in this scenario. Let’s follow these step by step to achieve successful outsourcing!
Web and software development outsourcing is basically to hire a third party IT company to do technology-related work. In the past few decades, this solution has brought many opportunities for outsourcing companies in Asia, Middle East or North America…
But when it comes to looking for an outsourcing contractor in a foreign country, it is not as easy as your thoughts without the experiences: time difference, work culture, language, cost.. that are all the important factors we need to consider thoughtfully.
Outsourcing is always an important part of any company that wanted to extended company size and saving manpower cost. Vietnam or India can be a good destination with cheap and loyal worker also easy policy from the government
Great Article Nash.
I noticed it was updated in February of this crazy year. Would you have said your opinions have changed or remain the same?
As a fairly small and relatively new website design business owner in Saigon (an expat at that too) I am torn between outsourcing or trying to maintain as much cash flow within house.
It would be good to know your thoughts if something as rare as we are experiencing would influence your decision.
Great Article. Choosing the right outsourcing company is the key and beneficial to your business. As it can reduce maintainance cost for a company
I agree with the author. With outsourcing in any field, it will help to simplify the project management which will increase productivity and scalability.
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Wow, I never thought that working with an outsourcing company could improve your business’s efficiency and get things done quicker. A friend is thinking about starting manufacturing different products, but he’s just starting in the business. I think that this option would help him out, so he can focus on making the business grow. Thank you for the information about the advantages of outsourcing.
Thanks for posting this artcle
It’s great that you talked about how outsourcing helps your business reduce its costs. One of my cousins works in the packaging industry, and the other day, he mentioned he needs to find another supplier for his product’s packaging materials. That’s why I believe your article could help my cousin with his problem. Thanks for your tips about the benefits of working with an outsourced company.
Biggest advantage of outsourcing IT: The flexibility and agility It’s a form of computing that can work with existing technology infrastructure, usually via virtual servers hosted in data centers and accessed via the internet. Our company provide best dialer services and 24*7 service provide .outsourcing helps your business reduce its costs.