The Allure of Cheap Outsourcing

As the world changes, what your business needs changes with it. In the face of evolving competition, the need to innovate remains constant and urgent, especially when it comes to marketing initiatives. Project budgets and resources often must shift to meet these and other challenges.

One way that business leaders have kept their footing on all this shaky ground is to outsource website development and digital marketing services. Once the realm of a few specialists, these services have since become commodities, with people all around the globe hanging up virtual shingles and announcing themselves as experts.

The appeal of outsourcing digital marketing is obvious. To put it bluntly, outsourcing is often faster and cheaper than doing things in-house. It can be a lifesaver in desperate situations. And its human element still gives it a competitive advantage against growing competition from artificial intelligence (AI) and robotic process automation (RPA). You might gladly automate your website, but would you so quickly hand your customer service over to an algorithm with a voice synthesizer?

Well, maybe. Either way, your technology is one of the things you’re most likely to be outsourcing. One study projects the global IT outsourcing market to grow by $98 billion from 2020 to 2024, and another outsourcing article states it will be worth $425.19 billion by 2026.

ONLINE PRESENCE IS EVERYTHING

No matter what social media or other channels you use, a website that accurately represents your company — with complete and updated information about your brand, products, services, and mission — is still the essential foundation of your company’s online presence.

Outsourcing this often very technical work can be faster and less expensive than doing it in-house, which is good. Isn’t it?

Well, as an agency owner, I’ve had clients come to us with outsourced sites that were built fast and cheap — and poorly, full of bugs and security vulnerabilities, and sometimes even a general lack of functionality. Mistakes are usually costly in the long run. Most often the client ends up hiring a company that charges 3–5 times more than the previous company to improve what was done already, or worst-case scenario, redesigning and recoding the entire project.

And the cost won’t be limited to time and money. You and your company could lose position, reputation, or control of the project. A client or campaign could lose face or revenue. You’ve relied on people who you don’t know much about except they’re in a different timezone and have all your passwords.

Building and maintaining a website requires more strategy today than it ever did before. You must talk to your developer about strategy, goals, conversions, and user experience. There isn’t a one-size-fits-all solution.

SO HOW DO YOU KNOW WHO TO HIRE?

What I’ve learned through my years of running web development and marketing agencies is that outsourcing key business processes requires careful consideration to do well. You need to think things through and be able to discern when a potential outsourcing firm really has the skills to do what you need.

You can’t do that without qualified interviewers on your team who not only ask the right questions but understand the answers. It’s critical to manage your outsourced work like any project and to assess and minimize your risks. And of course, to avoid foreseeable mistakes. In the end, outsourcing still has to be a collaboration. I’m going to cover all that below.

Outsourcing is an art as much as a numbers game. If there’s one word at the heart of it, it’s this: discernment.

THE REAL COST OF OUTSOURCING

According to research by Deloitte, two factors stand high atop the list of reasons that companies turn to business process outsourcing (BPO):

1. Cost reduction (70%)
2. Flexibility (40%)

Organizational flexibility has been critical for companies dealing with disruptions, shifts in their business model, and workforce. The new challenges of remote work, digitalization, and ecommerce were all growing plenty fast long before the pandemic put them on steroids. Other reasons companies choose to outsource (per Deloitte and others) include increased efficiency or agility, faster speed to market, assistance from experts, and access to tools and processes.

Money talks

Saving money may rank first, but it’s still less important relative to flexibility and other factors. Today, the economic uncertainty lingering from 18 months of shutdowns, mandates, and guidelines has caused more outsourcing managers to look at their budgets.

Many countries are home to large website development teams that work for much less than U.S. prices. For companies on a budget or looking to maximize their profits, that seems like the natural move to make. These teams get things done quickly because they focus lots of people on a single project, and they can be working while we’re sleeping if it’s a U.S. company that’s hiring them.

The lure of cheap outsourcing

But the easy and understandable desire for fast and cheap has drawbacks, especially when you’re hiring overseas. It costs more to outsource within the United States partly thanks to the customary multiple rounds of interviews to see if a candidate is a good fit or not with your own company culture. There’s more emphasis placed on getting to know them as people, as opposed to speaking with one representative of an overseas company who says, “Oh yeah, we can do all of that. We have a whole team for this and this and this.”

In effect, they’re already saying, “Yes, we’re a fit for you.” They’re telling you they have all the resources, and you’re basically trusting them to fulfill whatever you need them to do for a much lower cost.

But investing less time into interviewing these companies is also a mistake. For some reason you tell yourself that this is what they do all the time, so it seems like we should just hire them. They’re highly skilled, because they say they are.

Don’t just trust and think that it’s all going to work out fine. I’ve had many experiences of people saying they can do it all when really they can’t. This is why you need a qualified person who can screen them, who understands in detail what needs to be done, what milestones need to be met, and can ask a candidate exactly how they propose to do it.

EXPERTS SHOULD HIRE EXPERTS

Whoever is facilitating or conducting a hiring interview should have a good, specific sense of what needs to be done. For instance, you shouldn’t have a graphic designer or marketing director be the sole responsible party for hiring a web development team. Instead, maybe a project manager in conjunction with a senior engineer who understands web development.

In short, you need to have experts hiring experts, who can ask the right questions and decode the answers; and after hiring, who can check the source code along the way to ensure it’s on track. This can be someone on your team or you can hire a consultant to oversee that aspect.

Either way, it’s critical to have someone who can immediately grasp and handle a situation should something go wrong. If the team you’ve hired isn’t communicating or even ghosts you altogether, suddenly you’re left with this website or app, not knowing what to do with it or whether it even works as you wanted. A site can look great on screen and not work at all behind the scenes.

THE NEED FOR PROJECT MANAGEMENT

At our company, it’s very inefficient to have our lead web developers or even marketing director manage a project. That’s why we have internal project managers.

We put a lot of importance on people working to their strengths. A marketing director’s strength is to be creative, a web developer’s to be logical and efficient; a project manager’s role is to make sure that everyone is on task. That includes managing the team being hired, even if they have their own project manager. You can’t assume the other team is going to operate in the same manner as yours.

Of course, they don’t have to manage their people the same way you manage yours, but you can set the bar for expectations and accountability by communicating your own project management expectations, such as when you need to see reports, mockups, and other deliverables. You need to know where the project is at all times, so communication between the teams is critical.

The point is that you can’t expect others to do things the same way as you, or the way you expect, so you need someone on your team who can ensure things get done and you get timely updates. Your project manager should be part of the initial interviewing and hiring process to ask the other team’s project manager or salesperson exactly how they’re going to get things done.

THE ART OF TASK DELEGATION

It’s not enough to tell a developer, “I need this built.” There needs to be a mutual understanding of the project, its context, and your desired outcomes. You’re not building just a website, but an online presence that must endure, function, and grow over time.

To accomplish this, it’s important to create a framework for delegation; a mutual understanding of the context and desired outcomes of the project. Before you hire, you must communicate clearly how your site or project will be used and grow over time, and provide the information a candidate company needs to make an accurate assessment.

Do they really understand your needs? Do they regurgitate your specifications, or can they express them in a way that demonstrates their grasp and expertise? You won’t be assigning actual tasks until after they’re hired, but you can gain an early understanding of how they’ll approach your project.

It’s important to determine if a company really has the capacity and skills to achieve your company’s ideal outcomes. In the end, you need to have confidence they can deliver. Do they have a demonstrated approach or process for problem-solving? Do they have a project manager to serve as the point person to communicate with your project manager? Do they validate their work at milestones? They’ll always have answers, but do they know what they’re talking about?

RISK MANAGEMENT

Mistakes can have an impact far beyond an individual’s job and reputation. They can hurt a client, a campaign, and the person’s own team and company. So naturally, you want to minimize your risk of hiring the wrong candidate, and if you do your work up front properly, you lower the risk considerably. Ensuring good project management and engaging your expert people in the hiring process will take you a long way.

But things don’t always go smoothly or as planned no matter how well you’ve prepared. As I mentioned, we’ve had lots of clients come to us with broken websites that they outsourced cheaply, and we pretty much have to clean things up from scratch without even knowing what needs to be done.

At Reverence, we manage risk simply by knowing what’s going on at all times. We rely on status reports from our internal project manager containing what we did this week, what we’re going to do next week, any risks or issues that have come up, and comments. We send these out periodically and want the teams we hire to do that too if they’re not already in regular communication with us.

OUTSOURCING REQUIRES COLLABORATION

As much as you’d love to just outsource it and be done with it, hiring outside your company is still a collaboration requiring your participation. I know that seems like it defeats the purpose. But if a team we’ve hired hits a roadblock, I’d rather they come to me than go off and waste costly time guessing or experimenting on my project when our own developers may already have the answer.

This is partly why development is expensive and why open dialogue is important to minimize cost. There’s more than one way to code your way out of a development challenge, no web developer has experienced every potential problem, and new coding issues are constantly arising. We as the client know more about what we’re looking to achieve than a third party ever will, and sometimes we already know how certain technical problems can be solved.

A team we’ve hired should be able to say they ran across this or that issue, and then we can brainstorm or solve it together. This is why it’s important to have an expert on your team. We’ve asked, Have you considered this or that alternative? And they’ve changed their direction. I don’t mind being directive, even though I’ve hired them, as long as we can keep the project moving forward and nothing is being hidden from me as the client.

DISCERNMENT IS THE KEY TO A SUCCESSFUL PROJECT

Outsourcing key business processes can be a cheap, fast, and flexible way to run a company. The appeal is clear. But to hire the right team and avoid expensive fixes and do-overs, it’s critical to think through the hiring process and bring in the right people from your team.

Fundamentally, smart outsourcing is learning to discern between those who can do the job and those who tell you they can because it’s what you want to hear. The solution is to include your experts in your hiring process, people who know what questions to ask and can tell if a candidate really knows the answers.

Do you have experience with outsourcing? How has it gone for you so far? Leave me a comment below.