Outsourcing Your Work? Get the Answers to Your FAQs Here

Outsourcing your work? It is a big decision, and you want to ensure you do it right. But where do you start? What questions should you ask? Here are the answers to frequently asked questions about outsourcing and how it works in the real world. 

#1. What is outsourcing? 

Outsourcing refers to contracting out a part or all your business operations, such as IT, supply chain and customer service, to an external party. There are many benefits associated with outsourcing, including greater flexibility and cost savings. 

Outsourcing can help you reduce the workload on your team while also taking advantage of the expertise that is not available within your company. Additionally, it allows you to focus more on core business activities, which could increase profits. 

When choosing an outsourcing partner, make sure to evaluate their experience and qualifications carefully before signing any contracts. Also, keep in mind the terms of the contract: is it fixed or contingent? What are the penalty clauses if things go wrong? Is there a warranty included? 

Once you have evaluated all your options and decided who should handle certain aspects of your business, sign the SLA (Service Level Agreement) and set the contract in motion. 

#2. What are the advantages of outsourcing? 

Outsourcing can be a great way to save money on your business operations. By working with an outsourcing company, you can take advantage of their skills and resources to help run your business more efficiently.  

Additionally, outsourcing can allow you to focus on what you are good at while the services provider takes care of the logistical aspects of running your business. 

Outsourcing also allows businesses to scale up or down as needed without affecting core operations or sacrificing quality. This is especially beneficial for startups that may not have the workforce or resources required for full-scale operation right from the get-go.  

By outsourcing some essential functions of your business, you can achieve greater efficiency and cost savings while maintaining high-quality standards. 

#3. When should I outsource a service? 

Outsourcing can be a great way to save money on your business while still providing quality services. 

However, it is crucial to ensure that you make the right decision for your company by consulting with an experienced outsourcing consultant. They can help you identify which services may work best for your company and provide sound advice on how to go about outsourcing them. 

When selecting a vendor or service provider, always look for the following: qualified personnel, strong customer service skills, experience in the industry or field of concern, and rigorous quality control procedures. 

By outsourcing selectively and using reputable providers, you can reduce costs while maintaining high standards for performance. 

Recommended reading: The ultimate guide to employee outsourcing in Nigeria  

#4. Will I lose control over quality if I outsource? 

There is always a risk with any outsourcing situation, but if you carefully plan and manage the relationship, you should be able to maintain control over the quality of your project. 

When considering an outsource service provider, examining their experience, corporate culture, and record of accomplishment is crucial. You also must ensure they are compatible with your brand image and voice. 

Once you have established these parameters, create clear expectations for both parties regarding turnaround times, budget limits, format requirements etc. (this should be clearly stated in the service level agreement). 

Also, ensure that all communication is effectively tracked, so there are no surprises or discrepancies down the line. And finally, make sure to review the contract periodically to ensure compliance and assess whether changes would benefit both parties involved. 

#5. How do I create a business case for outsourcing? 

When creating a business case for outsourcing, it is essential to identify why you believe outsourcing is a better option than internalising your work. You should also consider whether you can absorb the costs of outsourced labour and whether the quality of your output will meet customer expectations. 

Once you have determined these factors, create a cost-benefit analysis detailing how outsourcing will enable you to achieve specific business goals at a lower cost than if you were to internally handle the task. 

Next, outline how much money you estimate would be saved by implementing this strategy over time. Finally, include information on potential vendors who can offer reliable and affordable services. 

By taking all these steps upfront before making any outsourcing decisions, you ensure that your decision reflects sound judgement and rationality. 

Recommended reading: Recruitment process outsourcing (RPO) — what it is and how to get started 

#6. How do I manage outsourced employees? 

Outsourced employees can be a great way to save money on your workload, but you must ensure that you manage them correctly for this to work. Here are some tips: 

• Ensure the outsourced employees have accurate and up-to-date information about their job responsibilities and the company’s goals. 
• Provide clear instructions and expectations, so they know what is expected of them at work. 
• Communicate with your outsourced employees regularly to address any issues or questions quickly and efficiently. 
• Hold regular reviews, so everyone knows where they stand, how they perform, and whether changes need to be made in duties or working hours/location (if applicable). 

A reliable outsourcing vendor will be able to help you manage all these processes and update you as the need arises. 

#7. How does outsourcing work in supply chain management? 

Outsourcing in supply chain management refers to contracting out parts or all of a company’s logistics operations. This can be done for various reasons, including saving money on labour costs, improving efficiency and consistency across different stages of the production process, and augmenting capabilities that are not available within the company itself. 

There are several types of outsourcing arrangements that an organisation may make, each with its benefits and drawbacks. The most common type is: 

• Contract manufacturing, in which an outside business is hired to produce goods solely for the customer. 
• Contract warehousing allows companies to offload inventory from their warehouses onto other organisations’ shelves instead of keeping it on-site; this can lower storage costs and improve delivery times. 
• Independent distribution centres allow manufacturers to bypass traditional retailers altogether by stocking products directly from suppliers (often with tighter stock levels than those found at retail stores). 

Supply chain outsourcing can also provide transportation management or information technology support services. 

By taking advantage of external expertise and resources, supply chain managers can optimise their operations for increased efficiency and performance while reducing costs & complexity. 

#8. What is HR Outsourcing (HRO)? 

HR outsourcing is contracting a third party to provide HR services for an organisation. This can include everything from creating and managing employee files to providing training and development programmes. 

Outsourcing HR may be ideal if you are unable or unwilling to take on this responsibility or your current HR department is not up to par. 

If you decide that outsourced HR is the best solution for your organisation, ensure that you select a provider with experience working with businesses of diverse sizes and in different industries. 

Additionally, it is important to consider budget restrictions when choosing an HR outsourcing firm; do not go overboard because they offer lower rates than usual. Instead, focus on factors like staff quality, track record and experience with specific software platforms or workflow systems. 

#9. Why do companies outsource HR functions? 

There are many reasons why businesses may choose to outsource their HR functions. Perhaps you do not have the time or resources to manage this process on your own, or you believe that an external company will provide a better level of service. Outsourcing can also save money in terms of salaries, HR fees, and overtime costs. 

External companies often have more excellent knowledge and experience when it comes to human resources management, so they may be able to help your business address any issues head-on. 

Additionally, human resource outsourcing can increase your workforce’s morale due to improved communication and coordination between departments. 

Ultimately, choosing an external company to handle your HR needs is a decision that should be weighed carefully based on your specific business objectives and needs. 

However, if you are unsure whether outsourcing is the right solution for you, speak with a professional like our team here at MacTay, who will help guide you through the process. 

Other benefits of outsourcing include: 

• Save on costs and labour while also allowing you to concentrate on core business operations 
• Tap into specialist skills and experience that are not available in-house 
• Gain the flexibility to scale up or down as and when required 

#10. What is payroll outsourcing? 

Payroll outsourcing is having a third party handle your entire payroll processing, from collecting wages to issuing paychecks. This can be an incredibly efficient and cost-effective way to manage your business finances, as you no longer need to spend time handling payroll yourself. 

Additionally, it can help you save on administrative costs associated with this task, such as filing taxes and tracking employee hours. 

If you are interested in taking this step toward self-sufficiency, several reputable providers offer competitive rates and comprehensive services. You can compare them using online reviews or browse through our outsourcing solutions. 

Recommended reading: 6 areas of your business you should consider outsourcing 

#11. What is Contact Centre outsourcing? 

Contact Centre Outsourcing (CCO) is the process of contracting out a company’s customer service operations. This can be done in-house or through an external partner, allowing businesses to focus their resources on more critical areas of their business. 

There are many benefits to CCO, including: 

• Reduced operating costs — by utilising an outside provider, you may be able to reduce your staff size and/or expenses associated with running a customer service department. 
• Increased efficiency — having a dedicated team specialising in handling customer interactions will result in faster response times and better Customer Service initiatives. 
• Enhanced visibility — thanks to live chat, video call capabilities, social media monitoring tools, and other communication channels, customers can always stay up-to-date on what is happening with their concerns or requests. 

#12. What services does contact centre outsourcing offer? 

Contact centre outsourcing can offer several benefits for businesses, including: 

• Increased efficiency and accuracy. With the help of an outsourced contact centre, your business can dramatically reduce its operation costs by automating customer service processes. This will allow you to focus on other areas of your business that are more profitable or critical to its success. 
• Enhanced visibility. Thanks to live chat, video call capabilities, social media monitoring tools, and other communication channels, customers can always stay up-to-date on what is happening with their concerns or requests. 
• Improved response times. By enlisting the services of PEOs (Professional employer organisations), you can expect quick responses from customers who need help with tickets or inquiries related to your product or service. In addition, experienced operators usually have a better command of the English language, which makes it easier for them to provide quality customer service. 

• Reduced stress levels for employees. Many companies find that outsourcing their contact centre reduces employee stress levels because they no longer have daily duties such as answering phone calls and manually handling ticketing systems.  All these tasks are now handled by highly skilled professionals dedicated solely to providing excellent customer service. 

• Cost-effective solutions. Contact centre outsourcing is often cost-effective compared to setting up a standalone contact centre from scratch. This is because most outsourced centres come with pre-configured platforms, assistance desk software, and call routing protocols which minimises the customisation required during setup. 

#13. How do I evaluate Contact Centre and BPO partners? 

When choosing a contact centre and BPO partner, the first step is assessing your current needs. This can include evaluating the number of customer interactions you need each month, hours needed per day/week, or total call volume. 

Once you have this information, you can narrow your search by looking at different contact centres and BPOs (Business Process Outsourcing) across various industries and sectors. 

Once you have identified a few potential candidates, it is important to do some due diligence on each one by reviewing their capabilities and past performance. 

Finally, make sure to agree upon terms with the chosen contact centre and BPO before signing any contracts or committing any resources. 

Need further assistance? 

Businesses today are under constant pressure to do more with less. This means they are always looking for ways to increase efficiency and productivity.

One way to do this is to outsource certain business functions to specialised service providers. This is where we come in.

We are a leading provider of outsourcing services in Nigeria. Our goal is to continuously meet and exceed our client’s expectations by providing strategic and bespoke outsourcing services (core or non-core) through the deployment of an end-to-end process management approach.

Contact us today to learn more about how we can help you streamline your operations and improve your bottom line.