The advantages and disadvantages of outsourcing projects
Outsourcing projects is often a great way for medium sized and smaller businesses to enjoy great cost savings. After all, why maintain a full-time web developer when you only need them to update your site monthly? Outsourcing brings both advantages and disadvantages.
Most obvious is the cost savings aspect. Not only do you save the salary of having to maintain a full time employee that you don’t really need to be in the office for the full forty hours a week, when you outsource you’re not paying benefits, unemployment insurance, and other related overhead that you would pay for an employee.
When you outsource, you can usually hire a specialist in whatever you need done, rather than having to hire someone who knows a little bit about a lot of things, in order to justify the hiring expense. Hiring a specialist means you’ll most likely get better results.
However, when you outsource, you’re subject to the freelancer scheduling, and some of the best ones book months in advance. You’ll need to make sure that you plan for situations such as these, and are able to match your deadlines to your contractor’s availability.
You’re also subject to rate changes. While most freelancers raise rates to match the market, frequently comparable to the percentage raise you would give someone you had on staff, you have no control over when they happen. Although most agencies and contractors will give reasonable notice when they raise rates, it could still be an expenditure that you didn’t plan for. If you don’t agree to the rate change, then you’re stuck with finding a new contractor.
While outsourcing does offer various benefits to the business owner, it’s not a decision that should be done at the drop of a hat. Take all factors into consideration, and choose carefully when you hire. It’s perfectly reasonable to ask about turnaround times and when you can expect a rate increase. If you can live with the terms set forth by the freelancer, then outsourcing can help you solve a variety of problems!
Danielle VanZorn, PMP, SPHR
