24 May Knowing When to Outsource and When to In-house
Outsourcing is certainly nothing new. The term itself was born back in the 1970s, when the trend of sending less-than-essential processes to third parties was on the rise. And it’s not as if no outsourcing happened prior to that. It’s just that there wasn’t a handy buzzword with which to describe the process.
But there’s no question that outsourcing proved beneficial to companies in those days. By some estimates, today’s manufacturers outsource as much as 70 to 80 per cent of their final products. Presumably, they wouldn’t do this if there weren’t clear advantages in terms of efficiency, savings and bottom-line productivity.
Today, outsourcing is more popular than ever before – especially in certain industries such as IT. While firms of the past were only likely to outsource select aspects of their operations, today’s companies are much more flexible and creative in terms of which duties they can pass along to third-party providers. The following are a few tasks that are often outsourced:
- Data processing
- Human resources
- Web design and maintenance
- Data entry
- Customer service
- Phone answering and message taking
As you can see, it’s a diverse list – and it certainly goes on to include many other tasks than those listed above. The point is that virtually nothing is off-limits from outsourcing in the 20th century.
The Benefits of Outsourcing
Of course, acknowledging that so much outsourcing is happening does not tell us why the practice has become so prevalent in the first place. But as insiders with plenty of experience helping other companies cover their phone lines, we at Netcall Solutions are in a unique position to understand the benefits of entrusting core tasks and responsibilities to a third party.
There are several core benefits that your business can enjoy when it outsources certain tasks. We’ll go over a few of the most compelling ones below:
- Greater efficiency : Many of the non-core processes carried out by your business are going to be accomplished more effectively by a third party. In the case of Netcall Solutions, we invest heavily in our team of customer service and phone-answering agents. Our personnel are experts in manning the lines, and we’re able to devote a much larger percentage of our resources in equipment and training than your company would for this specific task. As a result, we’re able to offer much more efficient service than your team would realistically be able to.
- Better value for money : Greater efficiency easily lends itself to better value for money, as well. This is due, in part, to the fact that we have multiple clients. If you were to handle all of your phone answering in-house, then you would have to invest in the proper equipment, hire the right employees and keep them up to date on training. We take care of these considerations ourselves, and then spread the cost across our base of clients. This means that you inevitably end up paying less than you would if you handled it in-house. The only exception would be if the volume of calls you were handling in house were so large, that you could easily justify creating an in-house department that experiences virtually no down time.
- Ability to meet demand : Following on from efficiency and value for money is the reality of demand for the services or products that you outsource. When it comes to phone-answering services, many of our clients find that there are peak periods during which they require heavy phone coverage. These periods may correspond to certain times of day or holiday seasons. Small businesses may find it challenging to ramp up coverage during peak periods, which means that tasks (such as phone-answering) end up falling through the cracks. Outsourcing providers are able to scale services up and down, which means that you receive all the coverage you need, when you need it – without wasting extra resources when you don’t.
Knowing What to Outsource and What to Handle Yourself
In the previous section, we listed a handful of the key benefits of outsourcing. These represent situations in which passing a process or task to a third party clearly makes the most sense. However, it’s worth noting that there are situations in which it may make more sense to in-house a task as well. But how is a company to know the difference?
To begin with, it’s safe to say that many (if not all) non-core processes should be candidates for outsourcing. Non-core processes’ are, in a word, service aspects that are not necessarily required by a company or firm in fulfilling its value proposition to customers. This could include system maintenance, installation and operational considerations such as answering incoming calls.
Many non-core processes are central to creating your company’s products and services, but this does not mean they are necessarily central to the product itself. The key is being able to discern which processes contribute directly to your product’s USP. These are likely to be tied up in specific processes that your firm excels at. In short, they represent special skills or abilities that your team possess – and that the competition lacks.
These are going to be your core business competencies, and identifying them requires some dedicated thought and consideration. Beyond that, it’s wise to consider handling any aspects of the business that involve proprietary secrets or special knowledge-based functions. Netcall Solutions are serious about building report with clients and maintaining confidentiality. However, we also understand that each of our clients may have sensitive data, knowledge or understanding that they would rather not send to a third party.
Finally, some processes may be deemed too risky or unpredictable to send out of house. This is a broad category, and relevant examples depend to a large extent upon the product or service that you are creating. Suffice it to say, if sending a process out of house introduces additional risk beyond a threshold that’s deemed acceptable, then it’s probably wise to keep it in-house.
When it comes to answering incoming calls and taking messages, the benefits have been proven vastly to outweigh any potential risks over and again. If you’d like to learn more about how Netcall Solutions can assist, please don’t hesitate to get in touch with us.