Why You Fail At Outsourcing

Posted on May 11, 2012 Written by Francis Teo 4 Comments

This post is inspired by a comment that I received recently that the resources I’ve been sharing has “no real value”. I disagree. These outsourcing techniques have worked for myself as well as all the small business owners I have shared them with. In fact, just before I wrote this post, I just posted a project on Elance.

Of course, there will be many businesses where outsourcing might be less effective. For example, if your business is the manufacture of industrial products, or maybe you run a cafe or restaurant, a large part of your business can’t be outsourced or brought offshore. For a service-based business, the potential benefits of outsourcing can be much greater.

There’s definitely a part of every business that can be outsourced using my recommended portals oDesk and Elance. Tasks like data entry and bookkeeping exist in every business. Most businesses have a website, and you can outsource the web development and design for a fraction of what it usually costs. If you think even further, you can get a programmer or web developer to create software to automate a lot of your business processes so that you spend time doing what is important instead of just doing it manually.

Virtual assistants (VAs) are another option. You can easily hire a VA to do market research, keep tabs on your competitors, complete your invoicing or even keep tabs on your competitors online.

The #1 reason why people fail at outsourcing is just that they brush it off as something that “doesn’t work” and don’t bother to even give it a try.

I’m sure there are skeptics among you, but my suggestion is, just give it a try. How will you know it doesn’t work if you haven’t even given it a shot? The risk is minimal, you can create a simple task in oDesk for less than $10/hour, and just try out an outsourced contractor for less than $50 and convince yourself that it works.

Of course, hiring an outsourced contractor isn’t always easy, and there are bad contractors just as there are good contractors. If you’re subscribed to my newsletter, I share a golden tip on how to sieve out about half of the bad contractors (who just recycle their resumes) and also some job templates to get you off to a running start.

If you’re not subscribed, click here to sign up now to get a complimentary PDF copy of my eBook – “Small Business Outsourcing Exposed”, currently retailing at the Amazon Kindle Bookstore, the iBookstore and the Nook bookstore (but you get it free if you sign up now).

As always, comments are always welcome, please leave them below.

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http://www.DeliciouslyIrresistibleLiving.com/ Tylesha Juliano

Nice insight. I would love to take this discussion a
step further and point out why people write it off. The primary reasons I’ve witnessed when
working with clients is that they don’t have a plan for bringing in support,
their goals aren’t clearly defined and/or they don’t have a repeatable process
in place for the work they need completed.
This makes the idea of outsourcing seem more tedious than it needs to
be. That’s why I walk clients through
the development of these key elements before moving to the next phase.

Could I add a word of caution? Never select a VA or contractor based on who
has the cheapest rate. Paying someone
$10/hour may seem like a great savings, but if it takes 5 hours to complete a
project that a VA charging — say, $25/hour — can complete in one hour, you
didn’t save anything and you wasted more of your time. Not to mention the wasted time you spend
correcting work that wasn’t done according to your specifications. I’m not bashing all VA’s that charge
low-rates — just a word of caution.

If you go into the partnership with a well-documented
system, you increase your chances of having a pleasurable and rewarding
experience.

http://www.DeliciouslyIrresistibleLiving.com/ Tylesha Juliano

Sorry, I don’t know why the comment jumped around like that. )
http://www.businesssmarter.com/ Francis Teo

Thanks for your comment.

I would definitely agree that you shouldn’t always look for the lowest price, but the best value. There are also several factors that I think should determine how much to pay. For example, a simple task like data-entry might warrant a lower per-hour rate while a more complex task requiring a higher level of skill such as programming or design would definitely warrant a much higher per-hour rate.

I mainly use oDesk as I like the way they implement hourly rated tasks, and I usually go only for the 4-star and 5-star contractors as they are usually more competent (but cost more). But value-wise, I think they are definitely better than the people who only charge $1/hour but have no track record.
http://www.businesssmarter.com/ Francis Teo

Oh, if you are looking for a good resource for clients that don’t have a system or don’t believe in a system, check out http://www.workthesystem.com/ which I read and recommend for business systems.