Strategic Planning

Outsourcing: Mitigates risk and improves performance

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09/17/2018 – By Jason Smale


In today’s global, competitive market, business owners and managers have a number of reasons to outsource work, it could be to manage and minimize the personnel numbers within their organization while they go through a growth phase, or because they plan to engage in long-term outsourcing to gain access to professional talent for periodic needs with less financial overhead, to name a couple. Below, we’ll go over a number of reasons decision makers within an organization are utilizing external talent to accomplish non-core business activities.


  • Optimizing operating costs
    • Lower operational and labour costs are among the chief reasons that an organization will engage in outsourcing. When properly executed, outsourcing can have a sizeable impact on the company’s revenue recognition and can deliver significant savings.
  • Improving company focus
    • Organizations will also engage in outsourcing to free up time and allow them to focus on their core business processes while assigning the responsibility of necessary, but not core tasks to an outside party.
  • Accessing the global talent pool
    • Outsourcing is no longer restricted to local service providers. With the e-business economy now emerging and greater access being made to a global talent pool, decision makers within an organization are utilizing offshore talent for things like IT solutions, and Marketing/Advertising.
  • Maximizing use of external resources
    • Whether outsourcing work to a local service provider, or utilizing the e-business, organizations will outsource functions that are difficult to execute on, or time-consuming while still realizing the benefits of this function.
  • Sharing risks with a partner company
    • Outsourcing helps organizations in mitigating risks and is one of the primary reasons an organization will engage in outsourcing.


Communication is key

Once you’ve identified the need to outsource functions within your organization, it’s imperative that you establish clear and effective communication channels. There are a number of team collaboration platforms available to businesses these days, selecting the right communication platform for your team is important.

Most platforms offer a variety of communication options, including one-on-one, as well as team discussions. The communication can be performed in the form of text-based communication or video conferencing. These platforms also have built-in file sharing capabilities, task assignment and progress monitoring functions.

Below we’ll link a couple of the highest rated team collaboration apps right now on the internet.


Requirements for successful outsourcing

When outsourcing first began to emerge as an option for organizations, managing overhead and labour costs were the chief concern for business owners and managers. Today, the motivating drivers are more strategically focused on carrying out value-added activities in-house, where an organization can focus on their own core competencies.  The critical areas to focus on for a successful outsourcing solution include:

  • Clearly communicated company goals and objectives
  • A strategic vision and plan, for both the organization and the outsourcing partnership
  • Sub-contractor selection
  • Relationship management
  • Properly structured subcontractor agreements
  • Transparency and open communication with stakeholders
  • Senior leadership support and involvement when organizations have a number of people involved in communicating with the subcontractor