Consulting · Entrepreneur

What work is outsourced by SMEs?

Anonymous

August 9th, 2018

Outsourcing industry is evolving tremendously compared to what it was a decade ago.

What assistance do you need from external sources and why? In other words, what is outsourced by SMEs compared to MNCs. Would appreciate your experience if you happen to belong to any ends?

Anonymous

August 9th, 2018

outsourcing is cheaper for early stage companies, as startups don't have much infrastructure in beginning

Dane Madsen Organizational and Operational Strategy Consultant

August 14th, 2018

HR, legal, accounting/CFO, insurance, facilities. Anything that is not core to getting a product in the market. In tech, it also includes development and marketing but I think that is not the best approach. If it is only task-oriented, then it is useful. If it is core, then it is a skill that needs to be in-house.

Paul Garcia marketing exec & business advisor

November 1st, 2018

There's no simple comparison between multi-national corporations and small-to-medium enterprises. I'm not sure why you think there's anything there.


There's almost nothing that a company couldn't outsource, but the real question is why companies do or don't outsource anything. Number one on the pro side is value. Number one on the con side is control.


Every company needs different amounts of different things. What's common varies from industry to industry. The perceived "need" is mostly a factor of planning. How has a company been structured to manage growth and to manage part-time needs.


A small company may not need a full-time accountant, but they still need one. Whether they're better off hiring a part-time accountant or outsourcing it to a service provider depends on the specifics of the situation. Generally outsourcing works best for commodity type services, where for example, ANY accountant would be adequate, not necessarily one that is very familiar with a particular area of accounting. The more generic/commodity oriented, the easier it is to outsource. Even so there are still differences. Not every outsource service provider can offer the same degree of customization nor do they all have the same level of quality or reliability in the services they deliver.


Some of the benefits of outsourcing are greater scalability (for example if your business has a seasonal rush), where you're not committing to full-time employees until you can guarantee their time will be efficiently used. Another benefit is an irregular need, such as a current employee going on maternity leave.


I disagree that outsourcing is evolving. I think what you're seeing is that companies have more tools available to communicate with, find, and manage outsourced work, but that's not an evolution of the industry. That's simply an improvement in management tools.


Outsourcing is usually a cost/benefit argument. Which costs and which risks and which benefits vary between company size, focus, and industry. You can find repeated outsourcing habits among companies with similar characteristics. The why varies, but it's usually cost versus risk.