21 Oct What shouldn’t you outsource?
The world of work has never been more specialised.
The complexity of modern businesses and the pressure that they are under to deliver more for less has made it harder than ever to deliver everything ‘in-house’. In fact, most businesses will outsource certain operations to help them focus on their ‘core business’ of serving their customers.
In response to this, outsourced solutions and managed services have appeared for just about every business function you can think of. From marketing to HR to operations, decision-makers outsource particular tasks or entire business functions. Others choose to outsource their on-site operations, such as Ricoh’s digital mailroom or print room services.
Deloitte’s research has found that the top reasons for outsourcing are:
- To reduce costs – 59%
- To focus on core business – 57%
- To solve capacity issues – 47%
Saving money, focussing on the customer and managing workloads are important issues for any business. But while there are countless outsourcing opportunities out there, are there any things that businesses should always keep in-house? And what kinds of tasks are most suited to outsourcing?
It’s common for businesses to look for outside help in capturing their mission, vision and values. But an agency or consultancy can only listen to what you tell them and help you articulate these things. They can’t tell you what your culture ought to be. And if they try to, it’s likely that the culture they project onto you will be inauthentic and not true to your business.
Similarly, while change management firms can help guide you through the cultural change process, cultural change has to be led from the inside in order for it to be embraced across the business.
Company culture is complex and hard to pin down, but however you define it, it needs to be authentic. Outsiders can help you articulate your culture and guide you through periods of cultural change, but in order for culture to be embraced, it needs to be led by people within the business.
Whether you provide services or sell products, most business will have a set of core offerings that they take to market. These offerings are what people pay for and, ultimately, what supports all of the other business functions. They may not be totally unique – few unique businesses stay that way for long – but through a combination of pricing, convenience and functionality they can create a competitive advantage of some sort. This is your ‘core business’ – the thing that customers pay for.
This should never be outsourced in its entirety. If your core business can be outsourced in its entirety, with little change in price, convenience or quality, there’s a good chance that your customers will be able to find a comparative service for less money elsewhere. After all, if you can find what you offer for less money, so can they.
Technical problems without understanding the solution
IT and technology are key outsourcing markets. In fact, Deloitte research found that 31% of all the IT services delivered globally in 2018 were outsourced. When the level of understanding required to solve a problem is high and the need is short-term, outsourcing that expertise is a perfect solution.
However, it’s important to understand the solution that is provided. Especially if the solution relates to your core business. For instance, if you’re a startup who is developing a software-as-a-service product, you may outsource the development of that product. But you need to have a record of how it has been built and the knowledge internally to make changes or adapt it yourself going forward.
A business needs to understand, in detail, it’s own core business. It’s no good taking a product of any sort to market if you don’t really understand how it works.
Management of outsourced projects
Outsourcing can lighten the load and give you access to the skills and expertise you’d normally lack, but it requires time as well as money. Outsourced functions can manage their own operations but they will need managing internally as well, particularly if you have multiple suppliers. Ultimately, someone within the business needs to have oversight of the outsourced workstreams and how they’re performing.
What are the ideal tasks to outsource?
While there are plenty of things that are best managed internally, outsourcing can be a great way of streamlining costs, tapping into expert skillsets and focussing on your customers.
There are countless outsourcing opportunities out there, too many to list in one post. But tasks which are ideal for outsourcing tend to share a few characteristics. They often:
- Fall outside of your core business
- Are cheaper to outsource than deliver in-house
- Can be expressed in clear deliverables
- Aren’t a skill that your team ought to learn
- Can be assigned KPIs and measured to track performance
From meeting room management to on-site print rooms and workplace data analysis to help you make facilities decisions, we offer a wide range of outsourced and managed services for the workplace. We currently have full-time Ricoh staff working in over 130 customer sites across the UK and our Net Promoter Score of 87 totally outstrips the industry average of 70.