Hiring in-house talent or
outsourcing, which is better? They both have pros and cons. The right
choice for each company depends on their circumstances and
objectives.So, how do you decide which is the right decision for your
business?
Outsourcing has its place in small
businesses especially in areas where a short term project is to be
carried out. Because funds might not be readily available, small
businesses in an attempt to cut cost often prefer to hire outside
consultants. However, if you as the small business owner need help
long-term or have the capacity to train junior staff members, hiring an
employee to become part of the team sounds like the best solution and it
can save you money.
Below are some pros and cons of hiring
in-house and outsourced talent that can help you make the right decision
for your business.
The pros of hiring in-house
Face to face conversations can
facilitate brainstorming and great ideas. This is mostly evident between
employees working on the same project. When a new team member is hired,
he or she will be naturally motivatedto contribute toward the company’s
progress and they can bring a fresh perspective to the existing team,
just as an outside consultant can.
Because intellectual property is often
confidential, you can have your employees sign a non-compete and
non-disclosure contract. This will give you peace of mind that your
ideas and business plans are secure and safe.
Another advantage of hiring in-house is
that you can solve problems ad hoc. Working in-house can help your
employee have access to other colleagues and managers directly which can
help tackle issues faster. However, if you are working with an outside
consultant, they can only take you on if they have availability and they
often help clients on a first come first served basis or by
appointment. No matter how urgent your issue is, you will have to wait
for your turn.
Cons of hiring in-house
Much stress is involved in finding,
interviewing, and negotiating with a new employee. When any employee is
leaving, the whole process begins again— and it’s not cheap.
Furthermore, providing employee benefits
and perks might be required to retain top employees. Either way, you
will have to pay national insurance contributions and soon even pension
after each full-time employee you take on.
The pros of outsourcing
If you need specialist help, many
providers are now choosing to go freelance or register as sole traders,
so there is a huge pool of talent in external consultants that you can
tap into; not to mention agencies.
From getting a project awarded to
getting the work done, it will require much less time because it’s easy
to scale your workforce comprised of external professionals. This can
also help your business become more adaptable to seasonal demands. For
example if you run a construction company, you will likely see more
client inquiries coming in during spring and autumn months. You can then
easily hire an interior painter or a furniture assembler as you receive more seasonal inquiries of this kind.
Moreover, if you outsource, there is no
need to invest in equipment of employee pensions. If the job to be
rendered requires specialised equipment, this is something that your
specialist sole trader will already own and not another business expense
for your small business. Furthermore, with the deadline for pension auto-enrollment deadline approaching in the UK, some small businesses will prefer working with external consultants for one-off projects.
The cons of outsourcing
While full time staff members often sign
up for a probationary period where they can be dismissed easily, sole
traders are often hired on a contractual basis and sometimes even
require a deposit ahead of kicking off the project. That’s why it’s very
important to be vigilant and ask for references or look at their
professional reviews. Many websites, such as Bidvine.com, make these
available for pontential customers.
If you are hiring an outside consultant
for an ongoing project, it’s always a possibility that a bigger contract
comes along and your project will no longer be their priority. Make
sure to include in the contract the length of time they should devote to
working on your project so that carrying out the work becomes a
contractual obligation.
