What You Absolutely Should NEVER Outsource in your Small Business

When small business outsourcing doesn't work

It’s so easy to outsource projects and tasks in your small business today that the possibilities seem endless.

In fact, your small business can economically accomplish a lot of things that yesterday could only have been achieved by a much larger company with significant resources.

However, it’s wrong to think of your global outsourcing ability as some kind of panacea to all of your operational and growth problems. Yes, the solutions are probably out there, but a bad outsourcing decision can be more costly than not outsourcing. Let me give you a simple guideline to internalize before you go crazy with outsourcing:

Never outsource what you don’t understand.

Maybe right now you have a thought kicking around inside your head like one of these examples:

  • I need a WordPress website.
  • I need a shopping cart.
  • I need social media marketing.
  • I need public relations.
  • I need customer relationship management.

I could go on and on with the list and you can probably add several of your own small business needs to it right now. Most of the items on my short list can be accomplished by outsourcing, whether it means hiring a freelancer or an agency, or signing up with some kind of cloud-based Software as a Service (SaaS).

However, if you don’t really understand how these things work specifically in relationship to what you need – today and in the future – you can spend a lot of money on something that you’ll end up replacing very soon.

For example, you don’t need to know how to program an online shopping cart yourself, but you need to know if you want one that connects to your inventory, has APIs that allow it to connect to a fulfillment service, allows for coupons, can be easily modified, etc. In other words, you need to understand shopping carts from an operational point of view.

If you think you can find an experienced shopping cart coder and just hand off the entire project, you won’t get what you need. After the shopping cart is installed, you’ll spend the next weeks and months on a costly and frustrating adventure of discovering what you should have asked for the first time.

If you scan my list above, you’ll see that some are technical items and others are more closely related to small business sales and marketing. If you’re a technical person, there’s a good chance you don’t have the best understanding or feel for marketing so you’ll want to outsource some of those tasks. The converse is true if your background and passions are in marketing.

Many of today’s most successful startups are founded by partnerships where technical wizards join forces with sales and marketing pros. These types of Yin-and-Yang founding teams are often necessary in today’s startup environment where technical and sales success are equally important in order to achieve marketplace viability.

When small business owners are about to go into a hiring mode, I tell them to make sure they have job descriptions in place. This forces them to understand what it is that they really need to have accomplished by the new hires. The same principle applies to outsourcing. Be sure you understand your needs and what can actually be accomplished before you dump a project into the lap of a contractor or sign up with a new SaaS.