Strategic Outsourcing: 5 Aspects of Business You Should Never Outsource

October 2, 2013 | by Pepper
What You Shouldn't Outsource Philippines Virtual Assistants Pepper

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Outsourcing has revolutionized business processes in many ways. From manufacturing to information technology, customer service, writing, administration, and even health care, outsourcing has removed the boundaries of traditional office space to make way for a more dynamic global workforce.

Robert S. Huckman, business administration professor at Harvard Business School, said in an article that “the world is not as ‘flat’ as one might think” in the business of outsourcing. He added that outsourced work should not be viewed merely as a commodity. Huckman said that when one cultivates his relationship with his vendor, the outsourced services has the potential to increase in quality and efficiency.

As much as outsourcing has become a gateway to easier, faster, cheaper, and more effective work processes, it also involves risks. From a business owner’s perspective, you should set a limit to the tasks you outsource. Delegation is your call and not your vendor’s. They may perform your tasks like clockwork but there should also be limits to their involvement in your organization. Here are five core aspects of your business that should remain within your company.

Decision Making. Outsourced services are output based. They deliver your requirements at the time you need them. Decision making is not a tangible output from a couple of assignments. It is a deliberate act that involves knowledge about your core business, the direction you’re going, and the current circumstances in your industry. All these things are known only to key people in an organization such as the business owner, executives or senior management, and the board of directors. Their experience and expertise cannot be matched by any outsourced vendor no matter how effective they may be. Decision making should remain within the company no matter how big or small it is.

Trade Secrets. Also known as “Core Competencies,” this is what differentiates your company from your competitors. Trade secrets make you the “best” at what you do. Outsourcing a function that will involve divulging these core competencies is similar to falling for the Trojan Horse. You are risking exposure and vulnerability by sharing it to a third party. They may be your most trusted vendor but there are a lot of circumstances beyond your control that could happen once your trade secret is released. Let your core competencies stay at the core of your organization and not elsewhere.

Unpredictable Functions. There are certain tasks that can be influenced by trends and other volatile factors. Predictability is the partner of efficiency in the outsourcing world. With most repetitive tasks delegated by companies, it only follows that you expect the same output regularly. Certain business processes lie outside the borders of stability. Some thrive with change and pace. For example, you cannot delegate the selection of items to purchase as this is dependent on the demand, exchange rate, and current trends. It can change anytime and it directly affects the quantity you will order. What you can outsource, though, is the encoding of purchase orders. There is a very small room for error for volatile tasks so it’s best to keep it in-house.

Business Planning. Business planning is solely dependent on the leadership of the organization. You cannot expect your vendor to create a five-year goal for you. This responsibility involves thorough knowledge of the company’s mission, vision, values, and core business. Everything that you do in business planning is aligned with these things. Your future steps are guided by these principles which are fully embraced by your organization’s leadership team. Third-party providers are there to help you reach your short-term and long-term goals through the precise delivery of your requirements. They are not adept to make strategic plans for your company.

Employee Relations. Employee relations should be handled on a personal, one-on-one basis. Whether it has to do with termination, promotion, or development, your employees should hear these things directly from you. It’s one of the things that should never be done virtually. It is not only unethical but it also shows that you don’t value your employees that much because you’re willing to let someone do this for you. The success of your organization lies in the hands of your employees’ performance. You need to interact with them as this means a lot to your team. May it be a praise or reprimand; these things should only come from you and nobody else.

Outsourcing is not for the lazy employer but for the wise one. It is for the prudent leader who knows what needs to be done within the organization and what can be done outside. It is for the discerning business owner who is mindful of the things he can control and confident of the things he can delegate. Outsourcing is a great business tool when done in the context of increased productivity and not at the risk of leadership vulnerability.

About Pepper Virtual Assistants

Pepper Virtual Assistant Services is a business solutions firm that specializes on administrative assistance, customer support, CRM, copywriting, and personal virtual assistance. We take pride in our reliable service and responsive client handling which embodies our team’s optimal performance.

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  1. Pingback: Smart Delegation: Five Tasks You Should Delegate to Your Virtual Assistant | Pepper Virtual Assistants

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