How Can Outsourcing Benefit Your Business?

Outsourcing is a business strategy that involves delegating certain tasks or functions to external service providers. Outsourcing can help businesses save money, improve efficiency, access specialised skills, and focus on their core competencies. In this blog post, we will explore the benefits of outsourcing, the best processes to outsource, and some examples of successful outsourcing by large companies.

Benefits of Outsourcing

Outsourcing can offer many advantages to businesses of all sizes and industries. Some of the main benefits of outsourcing are:

Reducing costs:

Outsourcing can help you save money on labour, infrastructure, equipment, training, and other overhead expenses. You can also access lower-cost talent pools in other countries or regions, and pay only for the work you need.

Improving efficiency:

Outsourcing can help you leverage the expertise and experience of specialised service providers, who can deliver high-quality results faster and more reliably. You can also focus on your core competencies and strategic goals while outsourcing the non-core or routine tasks.

Increasing flexibility:

Outsourcing can help you adapt to changing market conditions and customer demands, by allowing you to scale up or down your operations as needed. You can also access a wider range of skills and technologies, and innovate more effectively.

Enhancing competitiveness:

Outsourcing can help you gain a competitive edge in your industry, by improving your productivity, quality, customer satisfaction, and profitability. You can also learn from the best practices and insights of your outsourcing partners, and create more value for your stakeholders.

What Processes Can You Outsource?

While outsourcing can offer many benefits, it is important to choose the right processes to outsource based on the business needs and objectives. Generally, the best processes to outsource are those that are:

• Non-core: Non-core processes are those that are not directly related to the business value proposition or differentiation. These processes may be necessary for the business operation, but they do not contribute to the business growth or innovation. Examples of non-core processes are accounting, human resources, legal, or administrative tasks.
• Repetitive: Repetitive processes are those that involve performing the same or similar tasks over and over again. These processes may be time-consuming, tedious, or prone to errors. Repetitive processes include data entry, transcription, customer service, or quality assurance.
• Complex: Complex processes are those that require specialised skills, knowledge, or technology that the business may not have in-house or may be too expensive or difficult to acquire. These processes may also involve high risks or regulations that the business may not be able to handle effectively. Examples of complex processes are software development, marketing, research, or design.

Some of the most common ones are:

Finance functions:

These include bookkeeping, payroll and invoicing. Outsourcing these tasks can save time and resources for more strategic activities.

Marketing tasks:

These include SEO, content creation, social media management, email marketing, graphic design, web development, video production, and other digital marketing functions. Outsourcing these tasks can help you reach a wider audience and generate more leads and sales.

IT tasks:

These include software development, web hosting, cloud computing, cybersecurity, data analysis, technical support, and other IT functions. Outsourcing these tasks can help you access the latest technologies and solutions, and enhance your IT performance and security.

Customer service tasks:

These include phone support, chat support, email support, a ticketing system, feedback collection, complaint resolution, and other customer service functions. Outsourcing these tasks can help you improve your customer satisfaction and retention rates.

Transcription: 

Outsourcing secretarial or typing functions for example is a great way to lower business costs. Many businesses across different industries have been doing it for years, and have seen positive results. Here are some examples:

• Legal firms. Legal firms often outsource their transcription needs to save time and money. They can get accurate and timely transcripts of court hearings, depositions, interviews, meetings, and other legal documents.
• Medical practices. Medical practices often outsource their transcription needs to ensure compliance and quality. They can get accurate and timely transcripts of patient records, medical reports, consultations, lectures, and other medical documents.
• Media companies. Media companies often outsource their transcription needs to enhance their content and reach. They can get accurate and timely transcripts of podcasts, videos, interviews, webinars, documentaries, and other media content.
• Academic institutions: Academic institutions often outsource their transcription needs to support their research and education. They can get accurate and timely transcripts of lectures, seminars, interviews, surveys, dissertations, and other academic content.

How to Outsource Successfully?

Outsourcing can be a powerful strategy for your business growth and success. However, it also requires careful planning and management to avoid potential pitfalls and risks. Here are some tips on how to outsource successfully:

• Define your goals and expectations: Before you outsource any process or function, you should have a clear idea of what you want to achieve and how you will measure the results. You should also communicate your goals and expectations to your outsourcing partner clearly and regularly.
• Choose the right outsourcing partner: You should do some research and due diligence to find the best outsourcing partner for your needs. You should consider factors such as their reputation, experience, quality standards, pricing models, communication skills, cultural fit, and availability.
• Establish a contract and SLA: You should have a written contract and a service level agreement (SLA) with your outsourcing partner that outlines the scope of work, deliverables, timelines, payment terms, quality criteria, performance indicators, dispute resolution mechanisms, and confidentiality clauses.
• Monitor and manage the relationship: You should maintain regular communication and feedback with your outsourcing partner to ensure that the project is on track and meets your expectations. You should also monitor their performance using the SLA metrics and provide them with constructive feedback and guidance.

Examples of Successful Outsourcing

Many large companies have benefited from outsourcing part of their business processes or functions. Here are some examples:

• Nike: The global sportswear giant outsources most of its manufacturing to factories in Asia. This allows Nike to reduce its production costs and focus on its design and marketing activities.
• Goldman Sachs: The leading investment bank outsources some of its research and analysis functions to India. This enables Goldman Sachs to access high-quality talent at lower costs and improve its efficiency and productivity.
• Apple: The iconic technology company outsources much of its supply chain to offshore partners. Though its products are designed in California, Apple devices are manufactured all around the world by suppliers such as Foxconn.

The Reasons to Outsource:

According to the Outsourcing Institute’s Outsourcing Index 2000, there are many reasons why companies outsource. Here are some of the top reasons:

1. Improve company focus. It is neither practical nor possible to be a jack of all trades. Outsourcing lets you focus on your core competencies while another company focuses on theirs.
2. Gain access to exceptional capabilities. Your return on investment is so much greater when you outsource to a firm that specialises in the areas you need. Instead of just the knowledge of one person, you benefit from the collective experience of a team.
3. Reduce and control operating costs. When you outsource, you eliminate the costs associated with hiring an employee, such as recruitment costs, paid holiday and illness leave, office space and commuter hardware and software.

The Optimisation Process Results:

• Avoids Costly Temporary Staff. Working as a team means that on occasion roles overlap.  Someone is away ill.  A team member takes up the slack.  This means their work gets put on the back-burner [so ironically this can be as expensive as employing a temp!].  But what if you could have an outsource partner who could step in and provide the service as and when a situation like this arises?  An obvious example is typing.  PAs and EAs often still type, the cost of which is substantial.
• Cheaper than doing it yourself. Sometimes it is cheaper for someone else to do it than to do it yourself. If you look at lawyers, their charge-out rate is considerably higher than the hourly rate of a secretary. So if a Grade A solicitor in London spent two hours typing their own documents, their firm would lose chargeable time to the amount of £721.20 (after the deduction of transcription costs). If you look at a lower grade D solicitor would lose £232.30. Here it is madness typing documents yourself when dictating the document and having it typed is cheaper.
• Make Capital Funds Available. By outsourcing non-core business functions, you reduce costs.  Then spend the capital on items directly related to your product or your customers. 
• Frees Internal Resources and Office Space for Other Purposes.
• Reduces Risk. Keeping up with technology required to run your business is expensive and time-consuming. Because professional outsourced providers work with multiple clients and must keep up with industry best practices, they typically know what works and what does not. This kind of knowledge is invaluable and far more efficient than paying for internal staff to work on this.

Outsourcing is about using knowledge in the most efficient way whilst also offering cost savings!  Why aren’t you doing more of it?!

The True Cost of an Employee

OutSec Services Ltd, in association with Stanbridge Associates, a leading UK accountancy firm, have worked together to provide a useful took in the form of a Cost Calculator.  Spend three minutes and see for yourself the cost of your typing.  It will change your mindset. I can guarantee it!

About OutSec

OutSec is the UK’s leading online transcription company whose business has grown substantially since 2002. We are one of the most successful transcription companies in the United Kingdom.

OutSec provides secure outsourced transcription services to the medical, legal, property and surveying, universities, media and interviews, advisory boards, conferences & seminars, inventories, financial, corporate, HR, recruitment and Executive Search sectors.

Why is Dictation More Efficient than Typing?

Well, the simple fact is that we can all speak considerably faster than we can physically type:

“The average person types between 38 and 40 words per minute”.

A “good rate of speech ranges between 140 -160 words per minute.”

In other words, dictation is up to four times faster than we can type. Therefore, simply dictating a document is more cost-efficient, giving you more time to dedicate your efforts elsewhere in your business.

Therefore why not add OutSec as a business continuity option for your business? Accounts are free, you pay on a per-minute basis (rounded to the nearest minute) on a pay-as-you-go basis, with no contracts or minimum spend. What do you have to lose? Why not open an account today?

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