10 Most Common Outsourcing Mistakes Newbie Entrepreneurs Should Avoid

Outsourcing is an effective cost-saving measure for small and big businesses. Today, more businesses turn to outsourcing as a strategic step to gaining competitive advantage. It helps companies move forward by cutting costs and saving time while getting access to skilled expertise.

With the rise of virtual offices and teams, outsourcing continues to flourish. However, several mistakes can do more harm than good, rendering the outsourcing advantages ineffective.

To give your business a competitive edge through outsourcing, here are 10 most common mistakes to avoid.

1. Outsourcing something you don’t understand

Rule number one: Never outsource something just because you can’t or don’t want to do it. That’s not how outsourcing works. Even if you’re hiring an outsourced HR support, you, as the head of your company, should also know how to recruit and manage employees.

Entrepreneurs need to have a clear idea of every component of their business at a management level. Relying completely on a virtual team sends the notion that they’re managing your company, not you.

2. Outsourcing the wrong jobs

Just because you can outsource a nature of work doesn’t mean you should. It all boils down to your business goals.

If you’re a startup business, some of the best-outsourced areas are Human Resources or HR solutions, accounting, web design, and blog management. What works for startup businesses may not work for established ones.

3. Not looking at previous work samples thoroughly before hiring

Whether you’re outsourcing creative content, legal help, or administrative duties, like HR services, it makes sense to carefully assess the quality of work of the people you’re going to hire. Aside from seeing what they’re capable of, you’ll also get to know their style and if they’re in line with what you’re searching for.

4. Failing to start off with an initial meeting

A kickoff meeting is crucial before you start working together. You should talk about the tasks at hand, timelines, payments, and other key details. Don’t assume all your expectations, systems, and deadlines are crystal clear.

5. Not communicate properly while working together

Even a tiny bit of miscommunication can lead to big problems. Unlike your in-house employees, outsourced people won’t be physically there when you need them.

Keep all the channels of communication open to make sure everyone’s updated and in sync. Provide a detailed process and make yourself available for questions and suggestions. Set up checkpoints to ensure that the project is running smoothly.

6. Relying on written messages to communicate

As discussed, communication is crucial. When it comes to outsourcing, sometimes a topic or problem is too complex to discuss in back and forth e-mails.

For a smoother, more efficient exchange of ideas, you may talk on the phone, use a video call application, like Skype, or even use screen sharing to view files.

7. Not utilizing project management tools

If you’re hiring from the outside, you need project management tools to ensure you’re on the same track. Evernote, Slack, Trello, and Google apps are just some of the tremendous productivity tools that make your work process easier. These apps let you chat, upload files, and update information about the project seamlessly.

8. Outsourcing to a country several time zones away

There’s no problem with outsourcing to a different country with a different time zone. However, outsourcing may not be the best idea if the project demands a detailed collaboration on a frequent basis, which means one should be up in the middle of the night. Language and cultural differences should also be considered, especially if they’re likely to affect productivity.

9. Expecting top notch work for low prices

Rule of thumb: You get what you pay for. You can pay the lowest price negotiable, but expecting premium work from that price is a big mistake. If you’re working with remote employees, you need to pay fair compensation, which is often higher than the market price at the outsourcing location but lower than something you’d have to pay in your location.

10. Not keeping your outsourced employees happy

Some business owners view their outsourced employees as temporary personnel –but a cheap solution to staff the company during its startup phase. With that in mind, they tend to cut costs and be slow paying what they owe. Unhappy employees are never cost-effective.

Like your in-house team, you should keep the virtual team happy and motivated. Make sure to pay them on time and find ways to keep them invested in their work. Acknowledge good work and reward them with small incentives or gifts.

Author Bio: Carmina Natividad is a creative writer for HR Dept Australia, a provider of affordable and pragmatic HR services and employment law advice in Australia. Writing about helpful career management solutions for both employees and employers is her cup of tea.

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