According to the Center for American Progress, Plunkett Research defines outsourcing as the hiring of an outside company to perform a task that would otherwise be performed internally by a company. While outsourcing can take place here or abroad, recent data from the U.S. Department of Commerce showed that U.S. multinational corporations – the big brand-name companies that employ a fifth of all American workers – cut their work forces in the U.S. by 2.9 million while increasing employment overseas by 2.4 million.
Naturally, this has led to some controversy.
Although outsourcing may be looked upon unfavorably by some, there are many instances in which it might be an appropriate solution for your organization. In particular, there are certain types of projects that lend themselves better to outsourcing. Keep your reputation as a stellar project manager by considering the following outsourcing green and red lights.
Green light: Simple and repetitive actions
If a project involves a lot of menial work that could be done by just about anyone, outsourcing to an organization that can provide lower individual hourly rates probably makes sense. This way, you are not using up the valuable time of your skilled workers that could be more efficiently employed elsewhere.
Red light: Branding-related actions
Unless you are willing to invest substantial time and money training a very experienced consultant, you generally cannot rely on an outside party to understand the fine nuances of your branding strategy, or to accurately communicate in your company’s voice. The last thing you want to do is appear disjointed in your messaging. And yes, this includes social media activities.
Green light: Isolated skills you don’t have or need
If a project requires a skill set that is not central to your organization’s core mission and is not likely to become necessary in the near future, outsourcing might be a good strategy. Workload is also a factor. Because it will take extra time to get your team up to speed on such a project, staff members simply might not have the bandwidth to take it on.
Red light: Confidential or secure information
Be very wary of outsourcing projects that require you to share proprietary company data with an outside party. This may well lead to intellectual property and other legal disputes in the future. If outsourcing is absolutely essential, do a thorough background check on the organization you intend to hire and get a lawyer involved (for drafting a non-disclosure agreement, etc.) before handing over any sensitive material.
Green light: Tactical versus strategic
Tactical projects that are short-term in nature with a finite end date are better candidates for outsourcing than strategic projects that map to the long-term direction of the organization and may be tied into many other moving parts. It’s hard enough for internal organizations to get out of their silos long enough to communicate effectively about strategic projects – imagine how difficult it is for an outside party to be on the same page.
Red light: High-quality outcomes
Last summer, my husband outsourced our gardening to a high school student. He thought weeding was a basic, rote action, but when the girl couldn’t properly identify the weeds and cut down his lilac bushes by mistake, my husband realized he got what he paid for. Although overseas labor is usually cheaper, contending with language and cultural barriers could lead to decreased quality of service. If this an important aspect of your project, stay in-house.
Over at Business 2 Community, Alleli Aspili suggests that you evaluate your company’s outsource readiness with a free tool available from Infinit-o. The tool will help you assess whether or not to move forward with outsourcing, and will suggest what you should think about and plan for before going down this path.
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