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Tag: Outsource

  • I Stopped Doing These 3 Things Myself — and It Made My Business More Profitable | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    In the early days of any business, most founders wear too many hats. You’re the product lead, marketer, customer service rep and ops manager — sometimes all in the same afternoon.

    I’ve been there. When I was launching my first AI startup, I was writing code, answering support tickets, hacking on SEO and trying to figure out Google Ads at night. Every time I jumped from one thing to another, I paid a tax: ramp-up time, mental fatigue, missed details.

    Eventually, I drew a line: if a function had a steep learning curve, wasn’t core to the product or customer experience, and could burn cash fast if I got it wrong, it had to go.

    Here are the first three things I outsourced — what worked, what didn’t and how I make the decision now.

    Related: How to Turn Big Business Moments Into Lasting Brand Momentum

    1. Google Ads had to go first

    I took a real swing at it. I set up campaigns, followed Google’s recommendations and even tried Performance Max. One day it would “work,” the next day I’d spend $90 to make a $24 sale.

    Whether you’re running a SaaS tool, an ecommerce store, or a local service business, paid ads can become a black hole. The learning curve is steep, the platform is opaque by design and Google is always nudging you to spend more so the algorithm can “learn.”

    I hired a specialist. Instantly, I stopped burning time trying to reverse engineer bidding strategies and keyword intent. I could focus on the roadmap, customers and the parts of marketing I actually understood. Worth every dollar.

    My advice: Try it briefly so you understand the vocabulary and the levers. Then get out. Your money will disappear faster than your learning compounds.

    2. Social media was next — and it blew up (in a bad way)

    I outsourced content and channel management to someone who promised to “crush it.” I gave full access to my accounts. It devolved into drama, threats and low-quality work. I shut it down.

    The lesson? Never give full control of a distribution channel to someone you don’t know, and never confuse enthusiasm with competence. Social media can be valuable for any business building in public — but only if it’s handled by someone you trust and can hold accountable.

    Next time: I’ll only outsource to someone vetted by people I trust, with scoped access, clear deliverables and a kill switch.

    3. PR was the third — and it worked

    I’d watched competitors outrank me and land strong stories. I tried the DIY route (like HARO), but the ROI wasn’t there. So I brought in someone who could own the process — strategy, pitching, follow-through — and translate my product into narratives reporters actually want.

    That freed me to focus on what I do best while the media engine ran in parallel. For businesses in crowded markets or emerging categories, this kind of PR support can be game-changing.

    How I decide what to outsource now

    I use a simple filter:

    • Is this core to the product or user experience? If yes, I keep it.
    • Is the learning curve steep enough that I’ll waste weeks for marginal improvement? If yes, I outsource.
    • Could a mistake here be disproportionately expensive? (Ads and legal are great examples.) Outsource.
    • Do I understand it well enough to evaluate the work? If not, I’ll do a quick self-guided crash course, then bring someone in.
    • Can I structure a small, low-risk test? If yes, I do that before any retainer.

    Handling the handoff while staying lean

    I started with literal paper notes, then the Mac Notes app. Today, I still keep it simple: Trello boards when needed, email for most communication, and regular short check-ins. The point is clarity, not tooling.

    One clear metric, one owner, one cadence.

    Access-wise: role-based logins, password manager and instant revocation baked into the plan. That social media experience burned this into my process.

    Related: How to Actually Get Returns in Your Marketing Efforts

    About that “it’s faster if I do it myself” line…

    It isn’t. It just feels faster because you don’t have to explain anything. In reality, you’re trading days of deep work for weeks of shallow thrash.

    Do enough to understand it. Then move it off your plate — so you can focus on what only you can do.

    You can’t do it all — not for long and not well. Start by outsourcing the work that burns cash when done poorly, has a steep learning curve, or pulls you furthest from the product or customer. Keep control of your infrastructure, build small, reversible contracts and measure everything.

    The cost of trying to be superhuman is higher than the cost of a good specialist.

    In the early days of any business, most founders wear too many hats. You’re the product lead, marketer, customer service rep and ops manager — sometimes all in the same afternoon.

    I’ve been there. When I was launching my first AI startup, I was writing code, answering support tickets, hacking on SEO and trying to figure out Google Ads at night. Every time I jumped from one thing to another, I paid a tax: ramp-up time, mental fatigue, missed details.

    Eventually, I drew a line: if a function had a steep learning curve, wasn’t core to the product or customer experience, and could burn cash fast if I got it wrong, it had to go.

    The rest of this article is locked.

    Join Entrepreneur+ today for access.

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    Jeremy Gustine

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  • Entrepreneur | Outsourcing, Offshoring or Nearshoring — Which is Best for My Company?

    Entrepreneur | Outsourcing, Offshoring or Nearshoring — Which is Best for My Company?

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    Opinions expressed by Entrepreneur contributors are their own.

    Large corporations have been using offshoring to gain a competitive advantage by lowering their manufacturing costs since companies like General Electric pioneered the practice in the 1960s. Outsourcing started in the 1950s and became an attractive business strategy in the late 1980s as businesses began focusing more on their core competencies (NCST). Initially, these business strategies were mainly reserved for big corporations. However, as remote work technologies have developed and offshoring has gone from a strategy for lowering manufacturing costs to recruiting talent from around the world, companies of all sizes have turned to offshoring or nearshoring as a business strategy.

    The strategy has grown since 2020 due to five main factors:

    • global competition and the search for the best talent
    • COVID-19 forcing businesses of all sizes to work remotely
    • employees voluntarily resigning from their jobs en masse, compelling businesses to find talent abroad
    • high inflation rates and fear of a recession prompting businesses to examine strategies for cutting costs and maximizing their budgets
    • companies applying these strategies to almost all positions and not only IT.

    Related: Your Most Pressing Offshoring Questions, Answered

    What are the differences between these concepts?

    We must first understand the difference between outsourcing and nearshoring/offshoring. Outsourcing is when one company hires another to be responsible for a complete activity, losing control of the work done; the former pays for deliverables. For example, when a company outsources its designs to a design company, it relinquishes control of the activity, and the hired company takes responsibility for the designs. It will manage the team and deliver the designs.

    Nearshoring or offshoring is when a company hires staff abroad through a firm. The company controls the team, which reports directly to the company. The firm oversees legal compliance, payroll and HR — it might also provide office space and other value-added services. Let’s say a company wants to retain control of its design team and design activities; instead of outsourcing the work to a design company, it would hire designers from Mexico through a nearshore staffing firm. That firm would be the employee and be in charge of everything related to staffing, but the staff would report directly to the first company, ensuring they share the same culture and values.

    Nearshoring/offshoring is sometimes referred to as staff outsourcing because a company is outsourcing everything to do with staffing in a given country to a firm. Another term used for these practices is virtual staffing, where a company hires, for example, virtual designers. However, virtual staffing is a misnomer because the staff would not be virtual; they would report directly to the hiring company and would be an extension of its team in another country.

    The difference between nearshoring and offshoring is that, in the former, staff is in a neighboring country rather than an overseas country, as with offshoring.

    Related: 10 Strategies for Hiring and Retaining New Employees

    Which one is better for my company, outsourcing or nearshoring/offshoring?

    Deciding which strategy is better for your company requires first understanding your needs.

    From my experience, you should outsource when an activity:

    • is not your company’s core competency
    • does not affect your clients directly
    • does not involve support for your clients
    • does not strictly have to be controlled by you
    • cannot be handled by someone hired in-house, and economies of scale are available (for example, needing designs but not many scenarios would justify hiring a designer via outsourcing, whereas nearshoring/offshoring will be cheaper when you need to hire and manage a designer)
    • is one you do not know how and do not want to oversee (for example, outsourcing your accounting and taxes to a CPA firm makes sense when you prefer not to invest time and energy in an accounting and tax department).

    You can always use nearshoring or offshoring to cut costs or stretch your budget while getting talent from around the world. For example, if you have the budget to hire one digital designer but require a team, you might be able to hire three digital designers in another country. Based on my experience, I recommend analyzing which positions can be performed remotely by:

    • ascertaining if you are having trouble filling a position;
    • reviewing for each position how much you would save if you were to nearshore/offshore it; and
    • identifying any department, such as customer service, that could be completely nearshored or offshored.

    These analyses will guide you in developing a plan for building your remote team through a staffing company.

    Related: How to Prepare Your Employees for Outsourced Hires

    Should I go nearshore or offshore?

    Companies initially recruited from developing countries primarily to save money. They, therefore, turned to counties like India and the Philippines and began offshoring low-level positions.

    Companies are now using offshoring and nearshoring to save money and tap into global talent. They are offshoring positions of all levels. Companies are not looking for the cheapest solutions but for workers in the same time zone, countries with cultures similar to that in their country, and firms that share their values. Companies thus often look in neighboring countries, which is why nearshoring has been growing.

    Whether nearshoring or offshoring is better depends on what you are looking for. If you are looking only for savings, I recommend offshoring. Offshoring’s likely drawbacks are differences in time zones, culture and distance. If you are looking to save but willing to save a little less to have your team in the same time zone as you, in a country with a similar culture, and one flight away from your offices, then nearshoring is the best strategy for you.

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    Pedro A. Barboglio Murra

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  • What is Staff Augmentation? 3 Reasons It is Vital For Your Business

    What is Staff Augmentation? 3 Reasons It is Vital For Your Business

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    Opinions expressed by Entrepreneur contributors are their own.

    Recruiting and retaining exceptional talent is challenging and takes a lot of time, especially when companies in the tech space demand experienced developers and engineers.

    Moreover, filling in the gaps due to a lack of resources or specialists can be challenging and time-consuming at the same time, especially for high-tech roles like iOS developers or machine learning engineers, for which the demands have been escalating since the great resignation.

    This is where the model of staff augmentation comes into play! In this article, we will discuss the concept of staff augmentation, its increasing demand and why enterprises need to focus on in-house team expansion for quick hiring.

    Related: 10 Strategies for Hiring and Retaining New Employees

    Staff augmentation

    Staff augmentation is a type of cooperation model where businesses, from startups to corporate enterprises, source talent via staffing agencies to work with them temporarily to fill the talent gaps promptly.

    Today, staff augmentation has turned mainstream, with nearly $500 billion annual spending on global IT staffing services alone.

    Businesses now prefer partnering with staff augmentation service providers to boost the competency of their internal teams and accelerate the development process rather than spending weeks prospecting ideal candidates, conducting interviews and shortlisting candidates to fill an immediate talent gap.

    Related: 6 Ways to Effectively Navigate Market Turbulence in the IT World

    Why is staff augmentation surging in popularity?

    The staff augmentation model has been successful over recent years due to the following three reasons:

    1. It is suited for a hybrid work environment

    People willing to switch to low-paying remote jobs rather than continuing on-prem work in their previous settings indicate that the future of work is remote. Remote work is the new normal, especially in the technology and digital transformation sectors.

    Staff augmentation services are suited to cater to the needs of a remote-first global economy that still needs to prepare to let go of all the advantages of on-prem work. With this setting, businesses can extend support to their internal teams by partnering with staff augmentation service providers to cater to bridge talent gaps and meet deadlines faster.

    2. It is low risk compared to other outsourcing models

    The staff augmentation model triumphs over all the outsourcing models regarding flexibility, affordability and quality. Compared to other outsourcing models, the risks involved with staff augmentation services are zero to none due to constant collaboration with the internal teams.

    The augmented team or resource operates either as mere extensions of the internal teams or under the supervision of the in-house managers. Uninterrupted collaboration and seamless integrations of both teams eliminate any possibility of errors.

    Thus, the risk involved in this model is considerably lower than the other project outsourcing models like offshoring or managed services.

    3. Staff augmentation is flexible to scale without compromising sustainability

    As the global recession started knocking on the doors, the results of aggressive hiring and fierce spending started becoming more evident. Consequently, most businesses either stopped or at least cut-down spending on scaling by considerable margins.

    This phenomenon has kept thousands of global entrepreneurs from putting all the stakes in and investing aggressively in scaling their businesses. However, things have started to take quite an exciting turn as IT staffing, and resource augmentation services became mainstream.

    With IT staff augmentation, businesses no longer remain prone to compromising sustainability, as they can end contracts with external teams if things start going south.

    This model enables entrepreneurs to fuel their desires to achieve exponential growth and scalability without worrying about laying off permanent employees or (in the worst case scenario) signing up for bankruptcy.

    Related: 6 Ways to Effectively Navigate Market Turbulence in the IT World

    Why you need to start implementing the staff augmentation model

    The following facts and figures are clear evidence that the staff augmentation model is here to stay:

    1. The great resignation and the wake-up call

    The quiet quitting culture has been disturbing the workflow of organizations since the epidemic. Even amidst the global recession session, where companies like Meta and Amazon are forced to lay off a considerable part of their workforce, the culture of quiet quitting has not stopped.

    People silently leave their well-paying jobs due to a lack of serenity, toxic work environments, pay disparity or other reasons. As an entrepreneur, you should be prepared to deal with such cases within your organization.

    Although you must prioritize fostering a culture of collaboration and encouragement, you should also be prepared to fill in talent gaps in case a team member resigns on short notice rather than compromising on the resource quality to fill the gaps.

    2. Going above and beyond to fill talent gaps

    The onshore, offshore and nearshore markets could provide more diversity in IT skills and expertise your company needs, depending on your location. With staff augmentation services, you can access a broader universal talent pool, including from regions acknowledged for having the finest IT talents, such as Europe and Asia.

    Building external teams to bridge the talent gap using staff augmentation services can also help you save the time and cost of setting up dedicated workspaces and recruiting highly-skilled teams.

    3. Increasing cyber attacks

    As businesses switch to fully remote and hybrid working models, they become prone to cyber-attacks and data breaches. According to Statista, the data breaches in the third quarter of 2022 were at the all-time highest, with businesses reporting approximately 15 million data breaches.

    Although businesses are now setting up dedicated networking teams to safeguard confidential information from hackers and intruders, not all of them can afford it. Thus, they eventually recruit network engineers via an augmented staffing model to stay protected from potential cyber threats and data breaches.

    Related: 4 Best Practices When Choosing a Staffing Agency

    Final thoughts

    Using staff augmentation to address the talent gaps instead of outsourcing or managed services models let business owners keep the charge of the project. As a business owner, you get to choose the talent you deem fit for the role and maintain authority over the project to get things done your way.

    With staffing services, you not only eliminate the recruitment time and cost but also access a global talent of highly-skilled developers and engineers to work alongside your in-house teams to optimize overall competencies and boost productivity.

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    Asim Rais Siddiqui

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  • How to Outsource Product Development

    How to Outsource Product Development

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    Opinions expressed by Entrepreneur contributors are their own.

    According to Statista, around 74% of businesses outsource IT services, and 87% have stated their desire to maintain or increase their IT spending.

    The trend of working with remote development teams, which companies often use to outsource their product development, is prospering and will continue to do so in the future.

    Let’s discuss the significance of outsourcing your enterprise product development, compare it with an in-house team and discuss the considerations to understand the outsourcing model.

    How does outsourced product development help?

    When companies opt to outsource their product development, they’re looking for opportunities for various tech solutions and speeding up development at a lesser cost.

    Moreover, companies get access to modern tools and tech stacks, new resources, and top talent, optimize their IT processes, reduce costs, and make reliable forecasting regarding their short- and long-term IT objectives.

    Related: 3 Strategies to Optimize Innovative Product Development

    Outsourced product development vs. an in-house team

    In-house

    In-house teams are created from the ground up. You’ll fill the positions based on the talent and expertise needed for product development. Building an in-house team is comparable to hiring permanent employees for your business. You’ll shortlist candidates, conduct interviews, and onboard them through typical on-prem proceedings.

    The benefits of hiring an in-house team are that they’re in direct communication with the team, offer immediate support and, most importantly, are aligned with the company’s goals and vision.

    On the downside, in-house teams:

    • Are costly prospects with high turnover rates
    • They lack versatile expertise and problem-solving depth
    • Are not easily scalable for team upskilling

    Outsourcing

    Outsourced teams offer many benefits for businesses by providing a vast talent pool and no technology limitations, allowing businesses to exercise more control over budgeting and acquire better expertise.

    The only cons are the communication barrier and trust issues in the team. Moreover, legal issues regarding the hiring process, regulatory compliance issues, information exchange before and after the project completion, cultural intricacies and time-zone differences can cause a problem.

    The following are four things to consider when outsourcing product development.

    1. Analyze your problems and requirements

    Start by analyzing your problems, requests and requirements.

    Without a clear understanding of your requirements, you gain nothing from the contractor’s team.

    Create a to-do list of items and activities you need to be done, state your budget, and set approximate deadlines for all the milestones, for example, UI/UX design delivery, development, app testing, etc.

    Related: What Not to Do When Outsourcing

    2. Select the suitable cooperation model

    The most popular cooperation models are the fixed price and time and material models. Each has its characteristics and requirements; select the one that best fits your project.

    – Fixed price model

    As the name suggests, the fixed price model works through the fixed budget, timelines, and scope of work and is mainly preferred for small projects with highly limited functionality. Furthermore, the model doesn’t allow for catering to additional changes and iterations, is expensive, and there is a probability of possible tradeoffs concerning product quality.

    – Time & material model

    The time and material model is a flexible counterpart that infuses nicely with the agile principles. Unlike the fixed model, the T&M model allows teams to start development quickly. The flexible developer hourly rate allows teams to manage tasks and set deadlines and budgets. The agile approach benefits teams in determining the result or progress at each development stage.

    3. Select an agency or freelancer

    Deciding whether you need an agency or a freelancer isn’t as simple as people often think—if it’s a small project, hire a freelancer; if it’s a large, complex project, hire an agency. In my experience, there is always more to the story in most cases. You need to clarify you need specialists for which particular processes. Business owners often struggle with the prospect of how and from where to land the right contractor for their outsourced product development.

    Here are some of the best sources to find a reliable contractor:

    Social channels. Use social channels like LinkedIn to hunt full-fledged development companies or freelancers for your next project. Check out their social posts, read reviews from previous customers, see team ratings, and more to check their business credibility and trustworthiness.

    Business review websites. See platforms like Clutch, Trustpilot, GoodFirms, etc., to inspect agencies and freelancers and review their ratings, customer reviews, and other metrics to understand better their credibility and what their clients say about them.

    4. Create a design and software specification document

    Write a design and software specification document that describes your product (at least an MVP), how it will perform, and how you want the end users to interact with it.

    Despite being a laborious job, it is one of the essential things you’ll do in product design and development.

    The design and software document will contain the following elements—a comprehensive project overview, problem statement, project goals, target audience, functional requirements, intended features, aesthetic details, non-functional parts, suggestions and restrictions, and questions.

    Mistakes to avoid when outsourcing development

    1. Selecting a misfit contractor

    Business owners often mistake hiring the first contractor or agency they come across in their search. Hence, they hire a contractor whose location, experience, expertise and skills aren’t suited for their particular project. Take your time when organizing your search and starting the hiring process. The more detailed your analysis is, the better the chances for you to hire the right company and a responsible partner.

    2. Not familiar with the cost of your product development

    One of the most common mistakes businesses make is not examining the cost of outsourcing product development. The estimate might look reasonable on paper, but several underlying essentials might not have been included in the quote. Request the development agency to create and send a complete quote. Ask the right questions from the development team alongside the timelines that should help you analyze the actual project cost.

    3. Lack of a strategic action plan

    Having a sound strategic action plan is crucial when outsourcing your project. The inability to clearly outline your requirements and state deadlines of your deliverables isn’t something you want to experience.

    Ask yourself the following questions:

    • What are your project’s core goals?
    • When do you expect to complete your product development?
    • What are the developers’ working hours?
    • How many remote developers do you want to work with you?
    • Is your hired team experienced enough to cater to your custom project?

    Related: 3 Mistakes (Nearly) Every Tech Startup Makes — and How to Avoid Them

    Final thoughts

    No matter your requirements and project specifications, there are always pros and cons of working with an in-house team and outsourcing your product development. However, take your time to weigh the considerations by analyzing your problem and requirements, selecting a suitable cooperation model, choosing an agency or freelancer, and creating a design and software requirement document. Last, avoid mistakes when outsourcing product development, including selecting a misfit contractor, inadequate cost estimation, and lack of a strategic action plan.

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    Asim Rais Siddiqui

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  • 4 Tips for Choosing a Staffing Agency

    4 Tips for Choosing a Staffing Agency

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    Opinions expressed by Entrepreneur contributors are their own.

    The current health crisis, combined with the labor shortage, has caused companies worldwide to rethink how and where to source their talent and establish their teams, with many turning to staffing agencies. This article addresses what you need to know before choosing a staffing agency to ensure it is the correct agency for your business.

    Offshoring as a business strategy is nothing new; it has been used for decades. What has changed, however, is the what, why, and who of offshoring technology. At the beginning of the offshoring trend, the answer to the “what” question was the manufacturing process; the answer to “why” was to reduce cost by taking advantage of a cheap labor force; and the answer to “who” was big companies that could open their manufacturing facility overseas.

    Today, with all the technological advances that have been made to provide remote work alongside the current situation, the answers to these questions have favorably shifted. Businesses are offshoring all sorts of functions and jobs: from administrative, virtual assistant, customer service and finance to digital design and Information Technology. Lower costs are less relevant as gaining access to a global talent pool has become the priority and is no longer exclusive to big companies.

    Related: Need to Hire? The Benefits of Using a Staffing Agency.

    Outsourcing versus offshoring

    Before itemizing the key practices to implement when choosing a staffing agency, it is essential to clarify the distinction between outsourcing and offshoring to avoid misconceptions.

    Outsourcing or business process outsourcing (BPO): Outsourcing occurs when a company outsources its entire process, giving control of the employees and the outsourced process to a third party. In short, the company is paying for a process to be completed.

    Offshore and nearshore staffing: Offshoring occurs when a company turns to another country to recruit staff. In this case, the company is paying for an agency to hire and manage every aspect of staffing (employee records, law compliance, payroll), but the staff reports directly to the company; the process is not outsourced. The difference between offshore and nearshore staffing is that the former involves an overseas company, whereas the latter involves a neighboring country.

    Design, for example, is an important function that can be outsourced, assuming your company does not specialize in the design and does not have enough workload to justify hiring a full-time employee. However, if you are a design or marketing company, you would do better to use a staffing firm to build and run a remote team of designers working directly under your supervision by company guidelines, training and policies. In this situation, outsourcing design is not an advisable option.

    What to consider when looking for the right nearshore or offshore staffing agency

    As you can see, there are multiple ways to grow your team. In our company, Remote Team Solutions, we have seen many success stories: from a business that started with a single employee and grew into more than ten team members in less than two years to a business that was initially outsourcing its call center and now has its entire call center in Mexico working remotely. Our company has identified four practices that are game changers when choosing the right nearshore or offshore staffing agency. These practices are listed below.

    1. Be ready and prepared

    Working remotely is not the same as having your employees in the office. When employing a staffing agency, you need to be prepared, have tools, processes and job descriptions in place, and know precisely what you expect from your employees abroad. Be clear on what is better for the company: offshoring or nearshoring. Do you need your employees to work in your time zone? Do you need them close so you can go to where they are and train them in person or fly one of the leaders to your headquarters?

    2. Look at the staffing agency as a partner

    You need to choose the staffing agency the same way you would a business partner. As you grow, you will need more staff and support from your staffing agency. Their work culture and values should match those of your company. Make sure they can provide the positions and staff you will require as you grow. I always suggest asking for references and looking at an agency’s employee turnover rate.

    Related: How to Recruit Talent That Has the ‘Agency Bug’

    3. Never delegate employee selection

    The team determines the company’s success. The staffing agency may be the expert in hiring and filtering, but no one knows your business and culture better than you; therefore, ensure you can interview all the candidates and have the last word on who to hire.

    4. Communicate with your team

    This is critical in ensuring the success of your remote team. You must see your nearshore team as an extension of your company, make them feel part of it and gain their loyalty. A sense of belonging is vital. Make sure you have direct communication with your team, ensure the team knows exactly what you expect from them and have daily meetings and remote events to integrate everyone within the team.

    Conclusion

    I encourage entrepreneurs and businesses everywhere to observe the changes that have taken place in remote working and consider how they can benefit the most from them. Non-core functions, such as bookkeeping and legal procedures, can be outsourced, leaving you to focus on the tasks and processes that bring value to your company and clients. You can obtain the full benefit of a staffing company for these functions, which should not be outsourced. In my personal experience, I have seen many companies grow, using the strategies identified here but remember, like everything in business, you must do it right. Put in the time required and choose the right agency for your business.

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    Pedro A. Barboglio Murra

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