May 22, 2017 Ted Bauer

Should outsourcing projects be viewed negatively?

Let’s ask a real question up front: do you think that the idea of outsourcing projects (i.e. outsourcing anything) is a bad word? That it has a negative connotation?

Many people probably do — as economies grow, it’s usually a word associated with replacing middle-class-type labor with cheaper, overseas labor as a cost advantage within your company.

So is outsourcing a dirty word?

The strategic side of outsourcing projects

Globally, bureaucracy is actually on the rise. That surprises a lot of people because we supposedly live in this very innovative, entrepreneurial, tech-first time. While that’s true in many regards, the numbers show that most firms are getting clogged in the middle.

As noted in this article on The Next Web, outsourcing projects or divisions actually helps with that. Sometimes, as companies build or scale, they add roles, divisions, teams, and titles that will have no relevance in 2-3 years if the strategy pivots. It’s much harder to fire your team of strategic account managers then as opposed to simply not hiring them now — and see if you need a role like that when the company starts scaling and making more money.

In short, outsourcing projects of different kinds keeps you a leaner company. That’s a big advantage in today’s business world.

You turn the unfamiliar into the familiar

This is an important one, especially in new market expansion. Scaling a business in a new market is a really complicated task that requires knowledge of the market, product-market fit, understanding the pre-existing stakeholders, and then all the normal logistical/task work that goes into any business. If you try to take this on with a permanent staff, it’s hard. Often the degree of context for the new market isn’t there. That’s why outsourcing projects, especially sales, is crucial. Without sales you won’t be a company for very long, but if your sales model was developed somewhere else and it’s a new market, well… that can get dicey. Outsourcing projects take the unfamiliar and make it more familiar. In other words: predictable revenue can result.

So wait, is it a bad word?

Of course not. It actually allows companies to operate more effectively and scale up (and make more money) faster. It can be used as an advantage, and is in numerous companies around the globe. So don’t fear it, or think that it destroys more jobs than it creates. (The math on that goes both ways, but in general technology is reducing the amount of jobs we need.) If you get past the semantics on outsourcing projects and the emotions tied to the word, it’s actually a huge strategic advantage for you.

 

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