Are you outsourcing any portion of your business activities currently? If you feel that outsourcing is only meant for the IBMs and Microsofts of the world, then think again. Your competition is already offering more to your prospects with the help of their outsourcing partners. “Following the trend of larger companies, small-business owners are outsourcing a range of services, from HR to finance and accounting to customer services. But the outsourcing process requires some time and investment to find the right vendor, build a working relationship, and allow your employees to adjust,” says Joanna L. Krotz, co-author of Microsoft’s Small Business Kit.
Declining revenues brought on by the 2009 recession have put additional pressure on small business cash flow, forcing many firms to take tough decisions around cutbacks. Being smarter with the money they have, and spending each penny in a wisely planned way will help entrepreneurs recession-proof their small businesses in the coming years. Over 63% of small business owners have made-up their mind to cut down their overheads expenses (Forrester Report) and how do they plan to do it? Here’s how:
Outsourcing business activities that are not overly strategic:
If your aim is to offer superior customer service to your clients and prospects, what you need are trained and friendly customer service agents and automated phone systems. You do not need to build the call center infrastructure, recruitment and training division, etc., for this. Virtual Live agents can easily do the job, at a much lower cost and headache.
Similarly, many small businesses have outsourced payroll, human resource services, finances and bookkeeping, data entry, website designing and maintenance, IT support, and a host of other services.
For instance, some entrepreneurs might feel that because of their high sales volumes they would need a full-time bookkeeper/accountant. While the fact is that, you may be running a USD 5 million company, and still not need a full-time employee for bookkeeping. An outsourced experienced bookkeeper may manage your books at a fraction of the cost that you would otherwise incur in case of a full-time employee.
Therefore, it is worthwhile to reassess all non-core job profiles of your in-house resources and take a stance from a neutral point of view. For each activity, analyze if it really needs to be done in-house, or could it be done more cost effectively by a professional vendor.
Test and tread:
First, try outsourcing any one low-risk service or even one stand-alone project, and then move on to other areas. You can hire a dedicated assistant or build a team of hundreds of customer service agents based on your business requirements. Hiring virtual assistants for back-office or technical tasks is a growing phenomenon. Virtual assistants work on a contractual basis via online or electronic communications for handling functions such as answering/forwarding calls, managing day-to-day business data, online bookkeeping, and so on.
A small business, based in Newton, MA uses virtual assistants for a variety of projects. “We’re a small company that helps people achieve media attention for their businesses, and have outsourced a lot of work to several virtual assistants,” says the CEO. “It completely changed the way we operate. We collaborate online on a daily basis, and correspond via email and occasionally by phone. We have increased productivity by about 30% to 40%, and have finally gotten many of our back-burner projects out the door.”
The roster of choice for affordable outsourcing services is vast, so you must be careful while selecting a vendor. However, do not go all over spilling your activities at multiple locations. Small businesses are better-off delegating work to just one or two providers for all their back-office needs. Building a Virtual Business Center to consolidate all your back-office tasks with a single provider and managing it online is a great way to reduce overheads and management hassles. You would need a reliable project manager to ensure that your outsourced work goes on smoothly.
Here is some simple maths about the advantages of building a Virtual Business Center for your company:
No infrastructure requirement + no management headache + no recruitment and training hassles + business continuity assurance + lower total cost of ownership+ greater flexibility to increase and decrease team size + increased business agility + adherence to SLAs = reduced overhead costs + higher productivity => PEACE OF MIND.
It might take you time to get it right initially, but once you get a feel of it, outsourcing can bring tremendous benefits for your business.