According to the CEOs of many MNCs ‘White Collar lethargy’ is the new Pandemic, whereas companies are trying their best to woo employees back to the office and on the other hand employees are also coming up with some really amazing excuses. This situation gives rise to another debate whether today’s companies should hire in-house or outsource in the quest to achieve efficacy.
As a management student you will have to make some decisions, whether you need to have employees that work in-house or if you’d be better off outsourcing the position, which is becoming more popular these days. Both have Pros and Cons.
Let’s first understand what is Outsourcinge
Outsourcing refers to hiring a service provider, consultant, or agency to manage some aspect of a business. Commonly outsourced tasks include administrative tasks, marketing and social media, customer service, IT, and accounting to name a few. As a general rule of thumb, smaller businesses will need to outsource more often than larger ones.
There are 5 types of outsourcing:
Professional outsourcing.
IT outsourcing.
Manufacturing outsourcing.
Project outsourcing.
Process outsourcing.
Operational outsourcing.
Pros.
- Contractors are experts in their field and have specialized skill sets, degrees, certifications, and decades of experience with them.
- Depending on your project timeline, you might need a professional service for a shorter period of time. In this case, hiring a contractor is the best option, especially if your in-house team doesn’t have the skills.
- Contractors understand clients’ needs and problems and carefully formulate the best solution.
- Maintaining long term relations with them, can help the company in future. Plus, there is nothing wrong in growing your professional network – chances are they will refer you to their network, too.
- Outsourcing can greatly reduce or completely lift work burden, allowing staff to focus time and energy on their primary tasks.
- If someone on your team has been eager to develop their skills or grow in a different direction, hiring a contractor in their area of interest might extinguish that ambition.
Cons.
- Finding the right person or company can be time-consuming and challenging process. You’ll have to find a set of trusted, compatible contractors.
- The age-old debate of flat rate vs. hourly rate is alive and well with freelancers and contractors.
- It can take a while for them to speed up and getting them to that point of familiarity takes time and patience.
- Their work may discourage staff growth and morale.
- When sensitive information changes hands, it comes with the risk of a security breach.
Now let’s understand what is Hiringe
Hiring means to employ someone or pay someone to do a particular job
There are 5 stages of the hiring process:
Opening the requisition, screening the applicants, interviewing the candidates, selecting the best, and making the offer.
Pros
- You can build upon their (and your own) existing skills which will help in long run.
- If you already have someone on staff who can successfully take the reins on your project, it becomes a perfect opportunity for you to practice your own leadership capabilities. And as they expand upon their skills, they will become an even stronger asset to your company.
- Skills are transferable if you decide to train someone on a project-specific task, chances are they will be able to apply those skills elsewhere.
- If you treat your employees’ right, chances are they will be committed to the company’s success.
Cons
- You have to consider initial and long-term costs
- You might be tempted to look at only two numbers: the hourly wage of a new employee vs. rates of an experienced contractor.
- Your perfect candidate might lack enthusiasm.
- You have to motivate employees regularly for better work performance.
- If you can’t afford the time for proper training to keep them motivated, you might be backtracking to the detriment of your project and your employees’ professional development. They might lack the necessary certifications.
- This is one of the biggest downsides to training an employee on something new – it will detract from the tasks they were originally hired to do.
So, what’s the right choice for youe
There are three vital factors to in-house hiring and outsourcing: cost, expertise and flexibility. These three factors may play the largest role in how you choose between in-house hiring and outsourcing. It may be hard to have the best of all worlds, but this list of pros and cons may help you make a more informed decision.
Every organization's situation is different when it comes to how they approach project resourcing and procurement. Irrespective of a company's size, hiring managers will have to ask themselves which staffing/operational factors they value the most in regards to running their departments successfully.
