In the last few years, outsourcing has become a successful and widespread business strategy, with enterprises only using internal staff for core business functions while asking external actors to complete an array of secondary tasks. The outsourcing industry represents 31% of IT services in the world, and the global outsourcing market generated an average of $92.5 billion in revenue between 2000 and 2019 (Statista).
A 2019 Clutch survey also found that 37% of small businesses outsourced at least one business process, and over half (52%) planned to do so going forward. The tasks that are most often outsourced are usually ‘technical’ ones like IT services (37%), accounting (37%), and digital marketing (34%).
According to Deloitte, the top reason companies outsource is to reduce costs (59%) and allow their teams to focus on strategic goals (57%). But there are more reasons why outsourcing may be beneficial, such as enhancing the overall quality of work.
There is a lot of strategic and tactical planning involved in any outsourcing engagement, which is why the first step to such a transition should always be to create an overarching outsourcing strategy.
Advantages of outsourcing
Entrepreneurs want to keep costs low and profit high, and outsourcing tasks like meeting scheduling, sending follow-up emails, and administration work can save $5 trillion annually, freeing up 69 workdays a year for the average employee.
Switching between one tedious task and another is very time and money-consuming, costing on average 40% of a worker’s productivity. Outsourcing will help your employees concentrate on smaller to-do lists to increase efficiency. Since 45% of paid activities can be outsourced across all industries (McKinsey), you will be able to focus on compensating employees for their particular expertise and skilled labor.
Outsourcing gives access to expertise that may otherwise be out of reach, as you can look for niche experts for each project rather than depend on an in-house team that is good at everything, allowing everyone to focus on the tasks they are most proficient at.
Increased talent pool
Outsourcing will allow you to go further than the local and connect with highly skilled experts without increased costs. Deloitte’s 2018 Global Outsourcing Survey highlights that outsourcing offers opportunities to access services that businesses couldn’t integrate on their own.