Outsourcing allows business owners to do more with their business and their dollars.

On the flip side, it also means letting go of some degree of control, and a misstep in choosing the right outsourcing partner could have bigger repercussions in terms of output quality, reputation, and revenues.

So how do you decide whether to outsource? Here is some help so you can easily navigate the perilous path of outsourcing.

Know what.

Certain business areas are best done in-house. If the work is noncritical, you could outsource it. However, if your business hinges on that area, you should retain control and do it in-house, not outsource.

The same goes for anything that is client facing – including client facing administrative functions. Routine and repetitive jobs that are likely to cause fatigue and result in attrition of employees are prime for being outsourced.

The outsourcing partner can manage the churn by reassigning team members to other clients when boredom strikes, while your employees will benefit from being able to take on more exciting jobs. This could also help improve productivity per employee for your business.

IT services, certain routine areas of HR function such as payroll, can be easily outsourced with several specialists in the market. These functions are also technology-enabled, allowing you to instantly generate dashboards and get snapshot views of the status of things.

Know when.

Outsourcing is best done when certain requirements are met. For instance, when outsourcing charges per hour are lower than your own lower hourly costs incurred to perform the same function in-house.

It is also a good idea when your partner can deliver the scale you need faster than you can deliver in-house. Also, they should be able to offer flexibility to scale back when needed without you incurring any major costs.

Pick the right partner.

Access to quality vendors and outsourcing partners is vital. Without this, even the best plans can go awry. You need to work with a partner with proven expertise in the field—ideally, a specialist with particular experience in your industry or sector. Social media can give you a great insight into the people you’re going to work with!

Ready to take the plunge?

Some important questions any entrepreneur or business head should consider before they turn to outsourcing are listed below.

• Can outsourcing improve business performance?
• How will your in-house team react to the outsourcing?
• Can it complement the work you’re doing?
• Is the work being outsourced core to your business profits?
• Do you fully understand the proposed cost structure?
• Is the work cyclical, repetitive or routine?
• Does it require specialised skills?