Everything in a business rises and falls on the quality of its team. And the team that works together – in person – gets more done. As the world continues to venture into a virtual reality, I’m finding myself getting more and more old school about this one thing: I am a big believer in having all of our team members at Vanderbloemen be full-time employees and work in our central office. But that doesn’t mean that having all work done by full-time employees is the only answer. We’re living in a time where you can effectively outsource certain types of work , and it’s certainly worth a look for any resourceful entrepreneur.
In this new “gig economy,” there are a number of reasons you need to consider outsourcing now more than ever:
1. New Overtime Rules
The Department of Labor dropped a game-changer in May about the overtime pay for people who make less than $47,476. For startup companies that need the all-hands-on-deck work ethic from their staff but don’t have the revenue to meet this new legislation, outsourced work can be a life-saver. There are several ways around this new legislation, but outsourcing is a viable option.
2. The Rise Of The “Slash Career”
Over the last several years, the slash career has been on the rise. Millennials are a generation that deeply values work-life balance. That, coupled with the rise in technology, has made slash careers the new reality for small business owners everywhere. Embracing this new trend could save your company a lot of money while empowering someone to better pursue their passions on the side.
3. Added Complexity
Every time you add a paid employee, you add complexity to your team and culture. My easiest, quickest, and most unified staff meetings were back when we had fewer employees. In the hectic world of a new startup, less can often be more. Outsourcing allows you to keep things simple and clean while maximizing productivity.
4. Employees Cost More Than Just Their Salary
Tax savings (payroll) and the “soft costs” of having employees can add up quick. According to an MIT report, the average employee costs 1.25 to 1.4 times their base salary. So an employee with a salary of $50,000 a year actually costs you between $62,500 and $70,000. The added additional costs of employees like rent, cell phones, a break room, and gas reimbursements can make outsourcing a sensible option.
So how do you know what to outsource? Here are 4 questions to consider:
1. Can the work be done virtually?
If the work can be done virtually, the work can be outsourced. Resources like eaHelp or Ruby Receptionists can be great for administrative work, both in a pinch and long-term, and can be more cost-effective than having a full-time Receptionist or Administrative Assistant.
2. Is there a need for a lot of interaction with people?
If the work doesn’t involve much human interaction, it can be outsourced. Bookkeeping is a big one that comes to mind here. Companies like Cetera Financial Group can help you manage and implement strategies with your finances at a much cheaper rate than in-house options.
3. Is the work web-driven?
If the work is web-driven, it can be outsourced. As technology continues to evolve and change the workplace, there are constantly new ways of doing business more effectively. This article explains some of the most common web-driven work that is outsourced.
4. Is the work something that someone else could do?
Good leaders should do only the things that only they can do. As you approach a task, ask yourself, “Is this something that I alone can do?” If yes, then keep it that way. If no, then ask, “Is this a job that one of my full-time team members could do?” If the answer is again no, you have the greenlight for outsourcing.
I believe that a team needs to work together in person. But as the world changes and your business grows, keep an eye out for chances to outsource. It will keep your in-house team leaner, tighter, and unencumbered by non-essential work, and it will enable them to perform your core functions at a higher level than ever.