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Outsourcing Operations – 5 Key Learnings to Understand

Written by Nicholas Hastings, CEO and Founder, hammerjack

Making a significant structural change within your business requires a keen eye for analysis, and a well-informed sense of strategic direction. Often, we see a form of paralysis by analysis, as management becomes reluctant to move away from embedded, legacy operations. This apprehension in embracing change can hold a business back from reaching its true potential and give competitors a clear advantage.

Outsourcing any function, team, or pieces of work to an external supplier, especially one based overseas, does indeed represent a significant change for a number of businesses. However, most of the companies that I have seen embrace this change have achieved or exceeded the positive results they expected. The outsourcing industry has grown steadily across the past decade as further management teams come to understand the associated benefits of outsourced capital.

Individual needs vary across businesses of different industries, roles, and scale. To address the best solution for your particular outsourcing needs, it is always worth establishing a dialogue with our hammerjack team. We provide tailored advice based upon years of experience and a record of success.

1. Primary Cost Benefits

The objective is to keep your revenues high and your costs low. If you can produce your goods or services at the same or increased quality and output for a lower cost, then that’s the play. There are two fundamental ways that outsourced capital often represents the best-cost option for so many tasks.

Outsourcing, more specifically to an offshore team, allows businesses the opportunity to take full advantage of lower-cost environments that can be found overseas. The domestic Australian skills and labor market is expensive, as compared to many of our neighbours across Southeast Asia. Sometimes outsourcing domestically doesn’t translate to the kinds of savings you might expect, due to the relatively high rates many of these local suppliers demand. If you can find offshore capital that is able to produce the work you need, at the same quality as can be found locally, then there is an obvious potential upside for your business. Additionally, having workers with availability to work across 24/7 time zones may naturally offer turnaround advantages.

The variability of quality found overseas, and associated communication issues, are often the reasons many owners remain hesitant despite the cost benefits. If the standard of the work deteriorates, then any bottom line savings are immediately offset to some degree. This is why businesses need a partner, an outsourcing specialist such as our hammerjack team, to utilise their experience and navigate ownership towards proven offshore models in English-speaking countries with preferable time zones that can cater specifically to their requirements.

2. Risk Free Flexibility

In times of fluctuating revenues and ever-changing restrictions, it is in your businesses’ best interests to be dynamic and flexible, to be able to adjust quickly to issues as they present themselves. Outsourced assets are inherently less concreted into the infrastructure of a company. If revenue prospects change rapidly then you have a significantly greater ability to scale up or down with your outsourced capital as needs dictate with a lower overall risk.

Being able to adjust the tap of workforce capital available to you, and that you have to pay for, represents a significant advantage in these unprecedented conditions. Your business can be agile in accomplishing its essential operations whilst scaling production to a manageable level. As conditions pick up there is concurrently the opportunity to rapidly expand your outsourced workforce to quickly pick up any increased demand.

Partnering with an outsourcing specialist such as hammerjack streamlines the execution of this process, allowing your business to adjust its workforce needs even more efficiently. Your partner can assist in management of the outsourced team, and the establishment of best practice protocols and channels of dialogue, to allow you to expand or contract your available staff as required.

3. Focus on High Value Tasks

In a number of instances, businesses take advantage of outsourced staff for work considered less essential or crucial to the immediate success for the business. This correspondingly frees up some of the less urgent workload from the in-house team, which allows them to better concentrate their efforts more keenly on the critical tasks that require their attention. The less clutter your core, full-time, staff have on their plate, the more you can expect them to focus upon the major, value-adding components of your business operations.

Having external staff available to soak up the more menial tasks of the business frees time, and the mind, to be able to look at the broader agenda. This has the capacity to create a really positive sense of cohesion and direction throughout the business, as your core workforce aligns into one unit that understands the priority objectives.

Furthermore, your outsourcing partner will be able to assist in the management of the workload being delivered by your external workforce. Through clearly established pathways of communication and service delivery, you can rely upon your team to ensure that delivery of the work that you require is prompt and to the appropriate standard.

4. New Capacity and Skills

Outsourced workers additionally may bring skills to the table that are either inaccessible, or unaffordable, for businesses to access locally. For example, there may not be appropriately qualified accountancy personnel within your area, or you may not be in a position to be able to employ them domestically full-time. However, through a well-designed offshore outsourcing program these skill providers become far more accessible to businesses of all kinds.

hammerjack offer shared services solutions which allows you to take advantage of the skills staff offer from working across many organisations, that they offer without needing to provide the bulk of their weekly income. This opens up a broad scope of potential regarding the level of skill provider that you can afford for any given job, especially when considering the depth of the pool of talent that is additionally available overseas.

5. Tried and Tested Competitive Advantage

Ultimately, whilst it’s a useful exercise to talk about the potential advantages of outsourcing, the real proof of the concept is in how many businesses that we’ve partnered with that have seen tangible, positive results. There’s a reason why the global outsourcing industry has continually grown across the last ten years, notwithstanding the significant challenges that have faced business owners across the globe. These benefits are not simply theoretical, they’ve been tried and tested on the corporate battleground and have proven their worth.

There are already companies of all shapes and sizes that are realizing the advantages of a well-established outsourcing program as we speak, with many more to come. So, if you’re weighing up the odds for your business, make sure that you don’t wait too long and risk falling behind. Talk with our hammerjack team, and find the best solutions for your business’ needs.