Why & What should Startups Outsource?

Every Once in a while, when you read about Startup success stories, I’m sure you’re inspired and drifted into a dream to have your own unicorn someday. Every entrepreneur works hard to set their business up and running, a lot of Startups work up all directions but still are unable to survive. You’d wonder why? They had a solid model full of potential but some couldn’t find a product to fit the market, some lacked resources and so on. One of the root causes is lack of expertise in all the key areas. 

Many new businesses strive on a leaner model for operation and have a limited number of employees and experts onboard due to limited budgets. However even the most financially sound and market stable corporates can’t do it all on their own. Believe it or not, many worldwide corporations obtained their power through outsourcing development.

Startup Outsourcing is tried and tested. After all, your journey is supposed to be more focused and fulfilling rather than strenuous and stressful. From a long-term perspective, scarcity of resources means right asset allocation in terms of prioritizing businesses activities.

In general, primary goals include growth and expansion. However, desire for quick returns can overwhelm founders as this can result in lack of time to focus on core tasks, like product modification in response to demand, services, or brand relations.

Strategizing from the beginning on associating with the right outsourcing partner can help scale by focusing on core competencies. Delegating part of your work that doesn’t require your direct attention or functions that outgrow your expertise to ease out burden and bring in efficiency.

7 Reasons to outsource

Cost effective

The payments you make to the outsourcing companies is much less than what you’ll be paying otherwise to hire a full-time employee to do the same tasks.

Reduces work load for greater efficiency

As businesses grow, area of operation expands and so does the list of tasks. But this does not necessarily mean more employees all at once. This uneven change burdens your workforce and leads to a less OPTIMAL PERFORMANCE.When tasks are delegated, a pleasant work atmosphere is enabled.

Improved product quality

As efficiency increases so does effectiveness. You can ideate better and INVEST MORE in product development. 

Better focus on core functions

There are a few things that require an undivided attention from you. Know the difference and outsource what you can and what you need.

Increased access to experts in the industry

Outsourcing Cos. have an image in the market, which is why you get access to GLOBAL TALENTS. This also mean their network is diverse. As per terms from both ends, you can even tap this range for connections.

Efficient customer support services

As we scale up our growth journeys, major focus lies on widening our client base and offering our products / services. What’s left amiss is the after sale/transaction experience. When outsourced, a better client RELATIONSHIP MANAGEMENT can be expected.

Supports acceptance of your offering in the market

Faster decision making, better work plans, efficient utilisation of resources, processing better ideas and receptive response to the market are some perks of outsourcing non-core functions. These organisations have the efficiency, experience and expertise that help encash your goals through task management. This creates a BRAND IMAGE for you which in turn gets you more public acceptance.

Here’s a list of processes that you can outsource:

  • Advisory Services
  • Digital Marketing
  • HR / Staff augmentation
  • Development Operations (IT services)
  • Accounting / Bookkeeping
  • Customer Support
  • Infrastructures
  • Administrative support
  • Cloud Computing
  • Distribution

How to successfully outsource?

  1. Highlight the areas of operation for your businesses and categorise as core, recurring, priority, and costs incurred in performing them. This will help you analyse what you want / can Outsource.
  2. Once that is done, you’ll need ascertain who you want to onboard and what services you require in terms of expertise of individuals and experiences they hold, the impact that you want from outsourcing and your budget.
  3. While outsourcing, Look for Growth Partners rather than providers of offshore services.
  4. Invest more in the processes of Outsourcing. That is to say, do plenty research on who & what you hire as this has to be a long-term relationship and must coincide with your forecasts.
  5. Explain your ideas and expectations elaborately to make sure you’re on the same page.
  6. Communicate regularly for updates and to keep the processes aligned.
  7. Most importantly have a well-defined monitoring system to document and measure progress.

Authored by
Radhika Sharma
(Analyst, MergerDomo)

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