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Outsourcing the Way Forward

As a business owners, incorporated or not, in the early growth years we wear many hats, in addition to the technical one that brings the money in and pays the bills.  They range from PR Specialist, Web Designer, Debt Collector, Coach, Strategist, and even our own Personal Assistants. Then there is the Health & Safety Specialist, Problem Solver, Sales Guru, Accountant, Branding Expert, Employment Law Specialist – you get the picture?

How much of your time is spent doing non-fee earning aspects to running your business?  Completing a time log for a month is a useful way to identify where you are spending too much time not producing an income.

When you have identified what aspects of your current workload you could/should off load, you have a choice …

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To employ or not to employ – this is the question!

Employed

Self-employed

  • 24 days’ holiday
  • Sick pay
  • Family Friendly benefits
  • 13.8% NICs
  • 1% Statutory pension
  • Tribunal rights from pre-employment
  • Invoice you as and when required
  • Expert in their field
  • Self-motivating
  • Responsible for completion of work
  • Only tend to get paid if they’ve done a good job!

There are pros and cons to taking on an employee or the alternative, of outsourcing.  Now is the time to consider a number of aspects that are related to your business.  Check out the maths.  What is the monetary cost of

  • employing someone else including all employment benefits?
  • outsourcing to a third party?
  • doing everything yourself?

Will outsourcing

  • free up your brain and time to focus on what you do best?
  • Improve your efficiency or customer service?
  • Give your business a competitive advantage

Plus what value do you place on your free/quality time?

Then, you need to consider how much time and energy you will spend managing a relationship with your outsourced provider.  Any outsourced support will be representing you and your company brand.  You need to be sure they are representing you faithfully.

The degree, to which your outsourced expert will buy into your culture and your quality standards, will depend on how well you communicate your values, aspirations, and expectations. 

The Trust Control Dilemma

Some business owners lose control, and abdicate accountability for the work outsourced.  This is your business and your livelihood – you cannot do this.  Creating some control mechanisms is important to ensure you get the work done on time and to the quality you are expecting.

In the same way that you would draw up a job description and person specification for an employee, it is good practice to do the same for a job that you want to outsource.  You would interview candidates for an employed position; so do the same when you outsource. 

In addition to making sure they can do exactly what you want them to do you would also want to ensure they have a good reputation and glowing references, which you would check as you would a future employees.  What’s more you might also want to check that they are financially stable and who would be doing the work that you are outsourcing to them. 

Be careful not to imply an employment relationship

  • Check your paper trail, what does your service level agreement say?
  • The replacement test – how easy is it to replace this person?
  • The control test – who is in control of their workload?
  • Check tax status – who is paying the tax and NI
  • Who provides the equipment?  – If you provide equipment they may be employed.
  • Who pays for any insurance? – If you provide insurance they may be employed
  • What are other workers doing? – If they are doing similar work the outsource may be an employee.

If you think you are ready to outsource?

Establish the skills you need, start researching the talent pool.  There are so many networking opportunities to look within, recognise that it might take some time to find the right person. 

Write or outsource the writing of your service level agreements.  When you think you have found the right person, interview them and take references.  It is your business they will be representing after all.

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