In a tough economic climate, doing more for less is the holy grail in business. As start-up founders battle multiple headwinds, any opportunity to remain competitive must be seized. Surveys frequently show a greater interest in outsourcing among small businesses and one recent survey revealed that 83 percent of small businesses plan to maintain or increase their spending on outsourcing business services in 2023.
30 Percent Savings
But bringing costs down so your growth trajectory goes up is only half the equation. Yes, there are significant savings to be had. Instead of paying for employees, including training, taxes, holidays etc., you will be paying a service package. Similarly, there are savings from less working space, equipment, training and fewer utility expenses.
According to the Harvard Business Review this can typically translate into savings of 20-30 percent. Often the real savings are higher, and it doesn’t involve a trade off in quality for price either. On the contrary, outsourcing can enable you to access greater skills at lower costs and improve services and response times.
And by bringing on people that speak multiple languages and moving operations to locations outside of your time zone, it also enables businesses to widen their coverage and respond to customers on evenings, nights and weekends. Outsourcing can quickly turn your business into a 24/7 operation.
But the other half of the equation, which often doesn’t get as much attention as cost-cutting benefits, is how an outsourcing partner can transform your business model and help companies rethink their operations and improve services.
Improve Your Core Offer
Firstly, by taking away taxing non-core processes, it enables founders to focus on the all-important core part of their business. This is where the real value is created and is what differentiates you from your competitors.
As the organizational theorist and author, Geoffrey Moore, explained, growth-focussed businesses must distinguish between core and context – and context is what you outsource.
“Whatever is the new thing that creates differentiation, that’s core,” he explained. “Any activity that doesn’t differentiate the company in the eyes of the customer becomes less important than core capabilities.”
And it’s the core that determines if your business succeeds or fails. If context is done brilliantly, he added, it won’t guarantee success. But if it’s done badly, then your business will be in trouble.
Understanding this key difference is often the catalyst for businesses to drive innovation by focussing on their core competencies.
Scale Up Quickly
By freeing up time for employees to be more productive in their areas of expertise, you will not only create a more productive workplace but also one that is able to develop new ideas into concepts to improve your proposition.
Combining this greater focus on core activities with access to a larger pool of talent also enables small businesses to scale up quickly as demand increases without having to hire additional employees or take on extra office or equipment costs. A good outsourcing partner will be sufficiently agile and flexible to bring in experienced and capable staff as and when they are needed.
At Enshored, we have a unique division dedicated to helping start-ups with a strong track record of enabling rapid growth. It’s based on partnerships that seek to understand your business needs and brings you the people, framework and mindset to unlock your full growth potential.
A New Way of Doing Business
This approach reflects a decisive shift in how outsourcing is now being viewed by founders. No longer just seen as a cost-cutting exercise, it’s increasingly seen as a partnership to transform growth objectives and a new way of doing business.
It’s also a way of business that’s fast becoming essential in order to stay competitive in a turbulent and challenging market. And as growing numbers recognise the value it brings, why would you want to settle for anything less?
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