Which business functions you should absolutely outsource (and others you might want to)

You’re great at what you do. You wouldn’t have started your own business

without believing this.

But being effective at that one thing, whether it’s creating software, running a PR

firm, or developing web sites, is only the beginning. What about all the other

functions that make a business a business, like marketing, HR, accounting and

sales?

As a small-business owner, you can’t do it all. You’d be foolish to try, but owners

often will because they have misconceptions of outsourcing cost and a fear of

losing control.

I say “Whatever your ‘best and highest use’ is, keep that in the business,”

“Anything else, outsource it.” I’ve been a business owner for nearly 35 years and

in my early days I used the do-it-yourself approach and can attest that it will

always detract you from your company’s real mission.

I kept thinking that it would cost me too much, but it freed me up to make more

sales and deliver more product. About 20 years ago a very successful

entrepreneur said to me “STOP WORKING IN YOUR BUSINESS AND START

WORKING ON IT”! That has stuck with me since and I’ll never go back to those

old cumbersome and costly ways.

Here’s a short guide to what work you should — and shouldn’t — think about

outsourcing when you’re running a small firm.

1. Consider outsourcing

Accounting, bookkeeping and payroll

Depending on the specific task, these areas require large amounts of expertise,

administrative labor or both. And any mistakes can be costly. When you’re small,

these functions are best left to the experts. Some of the work will come back in-

house when your company develops more scale and complexity. Bringing payroll

and transactional HR back in house is far less likely even for the fairly large

organizations. The expertise and economies demonstrated by Human Resource

Outsourcers in these areas has grown beyond what most companies can offer

their employees.

Information technology

Most businesses have little wiggle room when it comes to system failures, data

losses and other IT issues. But hiring a full-time IT person makes sense only

when you reach a critical mass of hardware and software. Even then, IT is a broad

field, and a small IT department might not give you all the expertise you need.

You’ll likely want some outside help on this one. With the growth of Cloud

computing I think the advantages will be nearly impossible to overlook.

“Transactional” human resources

Unless 401(k) accounts and health insurance are your business, don’t make them

your business. There are many specialized firms that can administer these areas

far more efficiently than you ever could. The same goes for outplacement services

and any type of employee recordkeeping.

2. Keep in-house

Sales management

Small businesses get help with sales from many sources, including outside reps,

distributors and franchisees. But someone within the organization should

manage these efforts. The sales function is the lifeblood of your organization, so

it’s not an area where you want to give up too much control.

“Relationship” human resources

Let’s say one of your managers needs coaching. This as an inside job. Anything

else that involves face-to-face conversations with employees falls into the same

category. At the end of the day, building and retaining a high-performing team is

not really something that anyone can do for you.

3. Could go either way

Sales

Business owners tend to either love or hate selling. If it’s your passion, you might

be the best sales rep your firm could possibly have. Don’t be afraid to go with it,

as long as you can keep up with other important tasks. I, still do selling. It’s

something I enjoy, and it doesn’t give me any stress. Bookkeeping and

administration gave me stress.

Marketing

Chances are you’ll always have a role in marketing your business. If you’re not the

company’s biggest cheerleader, who will be? But marketing involves a

sophisticated body of knowledge, and it’s getting more technical every day. Do

you have the time and inclination to become an expert in search engine

optimization? Do you want to write brochures? Like sales, this might be an area

to manage in house, even as you outsource some or all of the day-to-day work.