What If The People You Outsource To Are Not As Good As You?

June 18, 2010 by Leave a Comment

Following yesterday’s post, Outsource Everything, I got a few emails from people who wanted to outsource but were unsure whether anyone could get the job done as well as it needed to be. That’s an understandable reaction and it was something that I fought when we tried to outsource some of our work. Sometimes it feels like it’s more work writing up a description of what needs to be done rather than just doing it yourself.

So I put together a list of 5 Reasons Why You Shouldn’t Care if Your Outsourcers Can’t Do the Work as well as You Can:

  1. So what? – My first response is so what if they can’t do the work as well as you. I guarantee you that they won’t be able to do things as well as you can because they can’t read your mind. The problem is that most people expect the work to be perfect right away. It doesn’t have to be. If someone else can do 80% of the work and you just have to go back and clean up the last 20%, you still saved a lot of time. Unless you find someone you really trust (and that takes a lot of experience), you should do some type of quality control over what’s done. Don’t just think you can hand it off and forget it.
  2. You’d be surprised how well they can do the work – This isn’t always true but it happens more often than you would think. Often times I send off instructions and just know that I will get some horrible deliverable and there will be a million questions along the way. Then I’m pleasantly surprised to see that they exceed my expectations.
  3. Some things you’ll never be able to get rid of – There have been some tasks that I wanted to hand off to someone else to do because I didn’t like doing them but then I realized there was no way to do this. These aren’t tasks that you should be outsourcing because they aren’t something that you can provide step-by-step instructions to. These are things that you have to think about and there is no way that someone else will be able to know what you’re thinking. Just outsource everything else, bite the bullet, and do this one yourself.
  4. Don’t hire them to do everything you do – Make sure you have specific tasks for them. Don’t provide them high-level needs and expect that they will think of everything. If you can’t write it down in steps, it’s not something that you should hire them to do.
  5. Find things that are monotonous – A lot of your activities might have a “thinking” component and a monotonous component. Don’t be afraid of doing the “thinking” parts and handing off the monotonous components. We do this a lot when we outsource web design. We determine what the overall design and feel of the site is and then outsource the actually coding with clear instruction on what needs to be done.

The key is to remember that you’re not hiring someone to solve world peace. You’re just hiring them to do some monotonous tasks for you. It’s not going to be everything you do but you’ll start finding more and more tasks that you can write instructions to and that you can hand off. And don’t be afraid to break it down so you provide most of the brainpower and they do the rest.

Filed Under: Small Business, Tips Hacking and Reviews Tagged With: ,

Outsource Everything

June 17, 2010 by Leave a Comment

Outsource everythingOne of the things I am a huge fan of is that every Business Owner should outsource everything that they possibly can. I know I’m not breaking any ground with this idea (if you want to read a great book on the power of outsourcing, I strongly recommend Thomas Friedman’s, The World is Flat) but what I am advocating is pushing this idea to the max. I look at everything I have to do to see whether it’s something I can just outsource it so that I can free up even more of my time.

One of the first really big projects that we received was for a web application in which we were paid a HUGE amount (our largest project for us at the time). This was a project that we scoped out as taking at least 3 months of our full attention. This is back when we were just testing the entrepreneurial waters and had other full-time jobs. All of our spare efforts were focused on this first product delivery, and we delivered as planned by focusing our efforts on it fully.

That project led to another one that was 3 times as big as the initial project and took us another 6 months to complete. Now it wasn’t for 3 times the dollar amount because of a partial equity deal we were involved in. The problem was that when it was all said and done, we had put in about 9 months, and all we really had to show for it was 1 client, 1 project, and nothing else for our business from the previous 9 months.

We don’t regret that period of time. We had a lot of flexibility because of our situation, we learned a lot, and we spring-boarded from that to working on the business full-time, but there was an important lesson learned there.

I Should Have Outsourced Everything that Didn’t Need Us.

The development of the application that we spent all of our time and effort on should have been outsourced to a development company that could have completed the effort based on the requirements that we had already created. We would have made a lot less profit from those efforts but we could have spent that time (which was A LOT of hours) on developing new business, creating new products, or just being lazy!

The important distinction are those efforts for which we are required and those for which we are not. New product/service development and most marketing efforts require our involvement because it’s very tough to outsource something when it’s not even defined yet. But for something that is relatively basic like web application development, we should have outsourced the efforts.

What Else Should I Outsource?
Honestly, if it is something that would take more effort for me to write up the instructions for someone else to do, then I’ll usually do it myself. Otherwise, I delegate it off to someone else. These are just a few things that we did ourselves until just a few times when we realized that it’s much more efficient to hire someone else to do it:

  1. HTML Updates for existing websites
  2. Contact Generation for Marketing efforts
  3. Direct Mail Generation for Marketing efforts
  4. Service Delivery fulfillment for direct mail pieces in our online marketing system
  5. Follow-up calls to existing leads
  6. Sales Lead generation and adding new leads to our contact list
  7. Web Application development

The Financial Mathematics of Outsourcing
The finance behind outsourcing is pretty obvious and has been discussed many times over so I won’t spend much time on it. Simply put, if you can get someone to do something for Ksh 10,000/- and your time is worth more than that Ksh 10,000/-, it is simply an efficient form of resource allocation. Or to put it another way, it might cost you Ksh 5,000/- to outsource a very menial task to someone and during the time that you might have done that yourself, you could create a new marketing campaign that generates Kshs 50,000/- in new business.

You don’t even have to do anything else during that time. If you would just like to spend less time working in your business, the Kshs 5,000/- might be a small cost for the additional free time that you generate.

You Don’t Necessarily Need Offshore Outsourcing
A lot of people automatically associate (and confuse) “outsourcing” with “[offshoring]”. Offshoring is just one way to outsource your work. You can also outsource it to onshore companies. By far, the majority of our outsourcing work goes to local resources. It’s just been easier for us in most cases to pay a little extra money and get someone we can communicate with easily.

Regardless of where you find people or companies to outsource your work to, you need to start outsourcing everything so that you can continually focus your efforts on building your business.

Photo courtesy of MarkHillary.

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Outsourcing to India

March 6, 2010 by 8 Comments

I’m sure you’ve all heard about the noble cause of the Kenyan government to make Kenya an offshore outsourcing destination. Companies like Kencall are, currently, the face of these noble and valuable efforts. I have been thinking about Kenya as an outsourcing hub and I still wonder, can we really make it a reality? Yes, companies like Kencall do very well but will Kenya ever be as big as countries like India when it comes to offshore outsourcing? I think not.

Last week, I was talking to some people who are interested in starting an egg (mayai) business. They want to sell eggs on a large scale. Do you know it is cheaper to import eggs from Egypt than it is to produce them locally? And that’s just one product – pick any industry in this country and you will quickly realise that producing goods locally if often several times more expensive than it is to just import them. What does this mean for us, as a country wishing to grow our producing and manufacturing industries?

You would think that imported products are cheaper, but those that are locally manufactured are of a better quality, yes? Well, this may be true in some cases but more often than not, it is not. A trip to Nairobi’s industrial area would leave you shocked at just how much of what we consume locally is outsourced – from packaging material to the whole manufacturing process. The people who outsource would like to use Kenyan alternatives but it does not make business sense to do so. Why pay more for something of a lesser quality?

What about services? We’re good at that, at least, eh? Well, not really. Undoubtedly, we have a very educated and extremely skilled workforce. But, it is still cheaper to get things done in India, or elsewhere. Case in point: Kenyan ‘technology’ firms (software producers, web design, web development, etc etc) often require to hire additional programmers, designers, etc to handle small tasks. The local labour force is very well equipped to handle these tasks. However, the local labour force is also nearly five times more expensive than offshore (often Indian) options. Who would you choose to go with?

Now, this post is not meant to bash Kenya and Kenyans. I’m a Kenyan too. 🙂

I’m just simply wondering: how can we compete with India as an outsourcing destination when we ourselves outsource to India? As a people and as a nation we have to ask ourselves: what are we doing wrong? Why is it cheaper to import sofa sets from China (and taking shipping costs into account) than it is to make the sofa set locally? Why is Kenyan stuff so expensive? Can we ever compete with economies like India or China? I do not know the answers to these questions. Do you?

What I do know is that the following are some of the things we need to address:

  • The infrastructure in Kenya is good, but hardly good enough. We still have frequent power losses and water shortages, not to mention many other things
  • The cost of doing business in Kenya has to be brought down
  • Our mentality as a people needs to change. The average Kenyan businessman is greedy – he would much rather do one job for a profit of 50,000/- than 10 jobs for a profit of 25,000 each

What do you think?

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